October 16, 2021
This new ruling would clearly disrupt free and fair markets by restricting the ability for retail traders to trade a stock while institutions and hedge funds continue to trade at will in dark pools.
This is the equivalent of being caught in a traffic jam on the highway, but allowing bad actors to bypass traffic on the shoulder because they deserve to travel without disruption. If a stock needs to be halted to balance the order book, all trading on both lit and dark markets must be halted in order to keep a fair and free market.
For instance, if institutions, hedge funds, or any other entity that has access to dark pools are allowed to trade freely when a company is about to release information that could materially affect the stock price of the company while retail traders cannot make any changes to their own positions, how is this ruling clearly not allowing institutions and hedge funds to trade ahead of retail investors? The SEC claims to protect retail investors, but this is clearly legalizing advantage to dark pool participants. Please feel free to reach out to me to explain how allowing big entities to trade ahead of retail for potentially days on end while retail traders cannot make a single change to their own position benefits retail investors at all.