September 30, 2009
It is my understanding that market centers that flash orders offer an opportunity for price improvement for the incoming orders. To the extent a market center flashes incoming orders to its participants, and those participants may only execute against the incoming orders at a price better than the limit price of the order, this is a benefit to the incoming order that should activley be encouraged by the SEC, not banned.
I think that the flashing of orders should be permitted provided:
1) all members of a market center are offered the opportunity to see the orders that are flashed,
2) flashing orders gives an opportunity for price improvement to the incoming orders, and
3) to the extent an execution does not result from the flash, the incoming order is displayed within the market center (and displayed within the national market system to the same extent as any other order submitted to a market center would be).
Thank you for your attention to my comments.