Securities Law Prof Blog

Editor: Eric C. Chaffee
Univ. of Toledo College of Law

Saturday, May 29, 2010

SEC Annoounces Panelists for June 2 Market Structure Roundtable

The SEC has announced the agenda and panelists for its Market Structure Roundtable scheduled for June 2. 

Panel One — Market Structure Performance and Price Volatility

How well does the current market structure perform the job of establishing prices and allowing investors to efficiently buy and sell stocks, both in normal and stressed trading conditions? How can the Commission improve current market structure to appropriately minimize short-term volatility and its harm to longer-term investors? Are there particular types of time out mechanisms for individual stocks that should apply across all trading venues? How should market orders be handled in connection with the duty of best execution? What are the most useful metrics for assessing market structure performance for different types of investors? Does the current market structure create imbalances that either favor or disadvantage longer-term investors? Is the current market structure fair for longer-term investors and how is "fairness" measured?

Ian Domowitz, Managing Director, Investment Technology Group
Charles Jones, Professor of Finance and Economics, Columbia Business School of Columbia University
Christopher Nagy, Managing Director-Order Routing Strategy, TD Ameritrade
Joseph Ratterman, President & Chief Executive Officer, BATS Exchange
Richard Rosenblatt, Chief Executive Officer, Rosenblatt Securities
Stephen Sachs, Director of Trading, Diamond Hill Investments
Timothy Sargent, Chief Executive Officer, Quantitative Services Group
Gus Sauter, Chief Investment Officer, Vanguard Group 
Panel Two — High Frequency Trading

How would you characterize high frequency trading? Overall, has its emergence been a positive or negative development for the markets? What effect does high frequency trading have on liquidity and spreads, both in normal and stressed trading conditions? Does high frequency trading affect market impact costs for other market participants? Are there particular high frequency strategies that are beneficial or harmful to the markets or certain participants? What types of tools are used by high frequency traders and does their access to these tools give them an unfair advantage? Do some high frequency strategies provide liquidity to the market in a manner comparable to the traditional obligations of market makers? Should high frequency traders be subject to any trading obligations comparable to those of traditional market makers?

Sal Arnuk, Partner, Themis Trading
Kevin Cronin, Director of Global Equity Trading, Invesco
David Cushing, Director of Global Equity Trading, Wellington Management Company
Michael Goldstein, Professor of Finance, Babson College
Richard Gorelick, Chief Executive Officer, RGM Advisors
Mark Grier, Vice Chairman, Prudential Financial
Terrence Hendershott, Associate Professor of Finance and Operations and Information Technology Management, Haas School of Business, University of CA at Berkeley
Stephen Schuler, Chief Executive Officer, GETCO
Jeffrey Wecker, President & Chief Executive Officer, Lime Brokerage 
Panel Three — Undisplayed Liquidity

What role does undisplayed liquidity play in today's market structure? What types of dark pools currently exist and whom do they serve? How much of institutional and retail investor order flow is executed in the undisplayed markets? Do institutional and retail investors receive better quality executions in the dark markets? To what extent do economic considerations for those who route orders — rather than best execution — affect routing decisions? Has the volume of trading in the undisplayed venues become sufficiently large that it is detracting from the quality of price discovery in the public markets, such as by exacerbating price volatility? If so, is there a viable regulatory response? Are market participants able to effectively access dark pool liquidity? Do dark pool participants understand the business practices of dark pools, such as transmitting order information to others? Should dark pools be required to provide greater transparency concerning their business practices?

Brian Conroy, Senior Vice President & Head of Global Equity Trading, Fidelity Management and Research Company
Larry Leibowitz, Chief Operating Officer, NYSE Euronext
Dan Mathisson, Managing Director & Head of Advanced Execution Services, Credit Suisse Securities
Seth Merrin, President & Chief Executive Officer, Liquidnet
Eric Noll, Executive Vice President-Transaction Services, NASDAQ OMX Group
William O'Brien, Chief Executive Officer, Direct Edge
Mark Ready, Professor of Finance, Investment and Banking, Wisconsin School of Business
Andrew Silverman, Managing Director & Global Co-Head, Morgan Stanley Electronic Trading

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