Mar. 28, 2023
March 28, 2023 Subject S7-31-22 As an individual investor, I am in support of this proposed rule change. The current system does not reflect a free and open market, instead only a few companies are currently able to fill orders from an individual investor. This prevents competitive pricing and even potential control of a given stock value to the those few companies. The current system of payment for order flow (PFOF) is banned in many countries due to the inherent conflict of interest, so an overhaul of this current system has been shown to be well tolerated by financial markets. Further, (PFOF) has not been shown to confer any significant price improvement, but does unnecessarily allow a company to act as a middleman which always results in an increase in the cost, which may be a violation of FINRAs best execution guidance. A public market to fill orders will enable both transparency and true price discovery. Although wholesale brokers may see market conditions adjust in real time for large orders or sell off, this is a attribute of supply and demand market that enables the true value of a given stock to be discovered. Furthermore, it has also been shown that after hours trading that is not available to retail investors are currently where most of the market adjust, indicating again that dark pools and PFOF systems do not currently allow for a free market available to all. This proposed rule change would be a significant step to restoring a free market that is based on the value of a given stock, as well as boost the public confidence in the current system. Other improvements that should be considered by the SEC would be to make the fines proportional to the profit realized by illegal activities, and loss of broker licensure.