Mar. 22, 2023
Matthew Disbro Bedford, Indiana 03/22/2023 The Honorable Gary Gensler Chair, U.S. Securities and Exchange Commission 100 F Street NE Washington, DC 20549 Re: Rule Proposal No. 34-96495; File No. S7-31-22 Order Competition Rule Dear Chairman Gensler, I am writing to express my strong support for the proposed rule to enhance competition for the execution of marketable orders of individual investors. As an investor myself, I believe that this rule would help level the playing field for individual investors and promote fair and transparent markets. The proposed rule would require certain orders of individual investors to be exposed to competition in fair and open auctions before they could be executed internally by any trading center that restricts order-by-order competition. This would apply to “segmented orders” for stocks listed on U.S. securities exchanges made for an account of a natural person or an account held in a legal form on behalf of a natural person or group of related family members, and in which the average daily number of trades executed in NMS stocks was less than 40 in each of the six preceding calendar months. The exceptions provided in the proposal are reasonable and necessary to ensure that the rule does not unduly burden market participants or disrupt the normal functioning of the markets. I believe that this rule would promote competition and transparency to enhance the opportunity for individual investors' orders to receive more favorable prices than they receive in the current market structure. It would also benefit investors generally, including institutional investors, by giving them opportunities to trade directly with individual investor orders that are mostly inaccessible to them in the current market structure. Furthermore, I agree with the analysis in the proposal that the level of price improvement offered by wholesalers does not fully reflect the much lower cost of executing orders from individual investors. This competitive shortfall is estimated to be 1.08 basis points per dollar traded by wholesalers, with an estimated total annual amount of $1.5 billion. The proposed rule would help to address this issue and benefit investors by reducing these costs. Finally, I would like to highlight the research that shows that markets are at once more fragile and less liquid today than they were just a decade ago. Markets are therefore less able to absorb larger orders, and this rule would help to address this issue. Thank you for considering my comments in support of the proposed rule. I strongly encourage the SEC to adopt this rule to promote fair and transparent markets. Sincerely, Matthew Disbro