December 16, 2021
Hello I am Shawn Hendrickson an individual investor who has been investing since 2016. While I am relatively young, I have had the opportunity to learn about markets and the power of investing. However, as I have learned throughout the years, the rules are not as black and white as I expected from a fair market.
I believe in a fair and transparent market, with all players having access to the same information as others. Without that equal and transparent access to information, bad actors have the ability to manipulate the market as they see fit.
I believe the DTCC should publish the full derivative chain. From start to finish, every day, T+1, T+0, or even sooner. Our technology has the capabilities of eliminating all nuance with our investment tools. We have the tools necessary for information to be accurate and real-time throughout the entire derivative chain of stock ownership.
I also believe that the lending of a retailer investor's shares without their clear and explicit consent is happening in today's markets. Brokerages have the ability to use retail stock as leverage, regardless if the account is on margin or with cash. The retail investor is left out of these negotiations and should only be loaned out with their permission and their benefit. I also think that shares should not be able to lent out an unlimited amount of times. In my opinion, one share means one loan.
Regarding Failures to Deliver, the practice is creating a toxic market structure and disrupting the entire market. Brokerages and their fulfillment chain continually avoid delivering promised shares. Retail has no choice in how their orders are handled by their brokerages. I am unsure on how to fix FTD issues, but I do believe reaching settlement dates close to or better than T+0. I also believe FTDs should be taken more seriously and not seen as a slap on the wrist for brokerages. How will investors know their share is a legitimate shares and not one loaned out and owned by another investor?
Thank you for taking my comment seriously. I do earnestly wish for an efficient and transparent market, that benefits all players. However, that can only come by a stricter enforcement of the rules and correcting bad behaviors that plague the markets. I hope the SEC decides to work for the benefit of the retail investor.