Mar. 20, 2023
From: Dan Vagg Sent: Monday, March 20, 2023 8:05:24 AM (UTC-05:00) Eastern Time (US & Canada) To: Rule-Comments Subject: File No. S7-31-22; Release No. 34-96495: Order Competition Rule Dear Ms. Countryman: I hope this email finds you well. I am writing to you today to discuss some concerning issues that have recently come to light regarding order-routing practices among certain brokerages.As an individual retail investor, I thank you for your effort to create more competition and transparency in the market, and I appreciate the chance to comment on these proposals. Brokers who refuse to accept payment for order flow (PFOF) route orders differently and consequently see superior execution quality. This is a crucial point that has been backed up by recent studies, including one that found Robinhood does not provide statistically significant price improvement relative to exchanges, despite PFOF being responsible for around 70% of its revenue. Furthermore, retail investors who do not deal with PFOF are receiving a better price than those who do, which is in direct violation of FINRA's Best Execution guidance. Speaking of FINRA, the regulatory body is currently evaluating the impact of not charging commissions on member firms' order-routing practices and decisions, and the findings of this review should be made public. Another issue of concern is TD Ameritrade's order-routing decisions, which do not appear to be motivated by competition despite what they state on their website. The firm also pays to get the first look at orders, routing them to firms that net themselves billions of dollars in the process. Finally, I want to touch on the need for more transparency in dark markets, particularly when it comes to alternative trading systems (ATS) like dark pools. These systems should provide quotes and trades to consolidated market data to bring more transparency to the market. Regards, Dan V