May 31, 2006
SR-ISE-2006-23 comment
I am writing to voice my displeasure with the ISE and its proposed implementation of File No. SR-ISE-2006-23. As a retail trader and manager of retail traders, I have had to deal with the constant implementation by the ISE of ridiculous, non-competitive rules that price out the individual retail trader. As a former member of the ISE and CBOE, I was taught that customer paper and customer orders are vital to the continued existence of the exchanges. The exchanges are supposed to act fairly and orderly in matching up orders. The exchange receives a fee to perform this action and has a fiduciary responsibility to provide a platform for traders, both members and customers.
By implementing a cancel fee solely for customers, the ISE is acting in a non-competitive manner. How can I as a retail trader be expected to compete if I am charged $1 for every cancel. I already pay a large fee for being a retail customer. The excuse that the ISE has given me is that this fee is a penalty for slowing down its routing system with numerous cancels. Now, as a publicly traded firm, I would think that the ISE would not only have the band-width to handle numerous fills and cancels, but would also be careful about engaging in non-competitive behavior, as this is a major offense.
The SEC is supposed to protect the individual investor from such offenses, especially non-competitive offenses. Without the protection of the SEC, retail traders and individual investors do not stand a chance competing with large conglomerates, such as the ISE. Please take this into consideration when making your ruling.
Sincerely,
Joe Mazzola
Managing Director
MAG Securities