January 23, 2024 - In a letter filed with the Securities and Exchange Commission (SEC) today, the FIA Principal Traders Group (FIA PTG) opposed the SEC's Volume-Based Exchange Transaction Pricing Proposal and urged the SEC not to move forward with finalizing it. FIA PTG said that exchange volume-based pricing tiers are just one small piece of the much larger transaction pricing picture, and that tweaking one piece of the pricing puzzle is unlikely to generate the results the Commission is looking for.
FIA PTG also opposed extending the Proposal to proprietary trading or options transactions cautioning that this would likely cause significant harm for no clear benefits. The most obvious risk from the inclusion of proprietary trading being a reduction in liquidity provision and price discovery, causing harm to the investor and issuer community.
Finally, FIA PTG said that the SEC’s economic analysis failed to provide evidence of clear benefits and failed to consider relevant and material metrics. They also noted that this Proposal is yet another of the myriad overlapping inconsistent equity market structure proposals currently pending at the SEC.
Read the full letter here.