From: James H. Applegate [japplegate@aimria.com]
Sent: February 6, 2004
To: rule-comments@sec.gov
Subject: File No. S7-27-03


Jonathan G. Katz, Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC 20549-0609

Dear Mr. Katz:

I am writing in regard to the SEC's proposed four o'clock "hard close" rule contained in S7-27-03. While I applaud your efforts in trying to eliminate late trading and create a level playing field for all investors, the adoption of this proposal would do just the opposite. As proposed, it would be very unfair to myself and millions of other investors that choose to do their investing through intermediaries such as brokerage platforms and 401(k) plans. In the case of the latter, we don't even have a choice in the matter - if you wish to save for retirement on a tax-advantaged basis, which the government encourages everyone to do, you must use your firm's 401(k) provider. This proposal would effectively create a two-tier system, giving those dealing directly with a fund company, as well as those with sizeable portfolios who trade individual securities, an unfair advantage over the rest of us.

I do support the modified hard close using time-stamping of trade orders by the intermediaries. I'm sure the technology to accomplish this exists today and this policy would not be discriminatory. Clearly, this is a better solution for all concerned.

I strongly urge you to reconsider your position on the hard close and instead, adopt the time-stamping alternative.

Respectfully,

James H. Applegate
5774 Beechwood Trail
Ft. Myers, FL 33919