So, it wasn’t just an afterthought. The SEC has clearly woken up to the possible unfair advantages enjoyed by those practising the art of high frequency trading.
Alternative trading systems, co-location services, dark pools/orders, ECNs, sponsored access — they all warranted a specific mention during the latest leg of Mary Schapiro’s ongoing PR blitz.
From the SEC chairman’s address on Tuesday to the SIFMA annual conference in New York:
I believe we need a deeper understanding of the strategies and activities of high frequency traders and the potential impact on our markets and investors of so many transactions occurring so quickly. And we need to consider whether there are additional legislative authorities needed to address new types of market professionals whose activities may not be sufficiently regulated.
Ms Schapiro’s over-arching theme seems to be that the SEC rulebook is woefully out of date.
Good news that she’s noticed that.
Related links:
HFT according to Greenwich: Friend or foe? – FT Alphaville
SEC discovers that financial innovation is risky – FT Alphaville