Dec. 26, 2022
December 26, 2022 Hello, As a retail investor trying to make important decisions for my family's future, I want to believe in the transparency and fairness of US markets. We can all agree that US markets are intended to be without rival in the world when it comes to these qualities. Without that trust, it is a challenge to be confident that my investments are being honored. One of the principles of a transparent and fair market is that trades occur on exchanges and influence pricing. Across a number of securities, this principle is being violated as large percentages of trades are being routed internally through major market makers and brokers. I understand the value of these moves in terms of logistics, but such considerations should never outweigh the importance of trades hitting live exchanges where they can impact price improvement (or otherwise). How can markets determine the true value of a security if the bids and offers are not actually being presented in their entirety? The conclusion I draw is that large wholesale brokers, like Citadel and Virtu, are skimming pennies off of trades that do not impact price as they collect thousands of orders from retail investors across low-cost trading platforms. While they undoubtedly perform a service, the hidden costs of this practice are not included in their purpose within the markets. My assumption is that those market participants with the most to lose from this proposed rule will argue forcefully that market-making efficiency is a priority in our digital trading era. Certainly it is, and there is more work to be done by the SEC to address the high-speed algorithms that outpace human decision-making around trades. But let's not conflate the main issue at hand: trustworthy markets that follow the principle of supply and demand are the core of the market. Orders still settle in two days, so efficiency at the moment of purchase and sale is minor by comparison, and limit orders can be in place for long periods of time. Auctioning bids and offers would become very efficient the moment it became required. Let's not allow the interested parties with deep pockets shift the markets further in their favor. Retail investors need to know that when they make an investment, the underlying security will move with the markets and include all orders. Thank you.