From: Rennie, Craig [CRennie@walton.uark.edu]
Sent: Wednesday, June 23, 2004 2:16 PM
To: rule-comments@sec.gov
Subject: Comments on proposed rule change - File No. S7-10-04

File No. S7-10-04


Jonathan G. Katz
Secretary
Securities and Exchange Commission
450 Fifth Street, NW
Washington, DC  20549-0609

Dear Mr. Katz:

I am an Assistant Professor of Finance and the Sam M. Walton College of 
Business, University of Arkansas, where I research and teach investments and 
financial markets and institutions at the undergraduate, M.B.A., and Ph.D. 
levels. I am also an individual investor. 

During the past few months, I have observed the debate over the SEC’s NMS 
recommendations, particularly those regarding the proposal to do away with the 
trade-through rule in favor of an opt-out provision. I am concerned that the 
anti-competitive interests of some may be about to be placed ahead of the 
interests of small investors who make up the backbone of America’s economy, and 
whose confidence is essential to the health of our financial system. There is no 
question that investors, whether large or small, should receive the best price, 
and should be protected by the SEC by rules that guarantee price protection. The 
trade-through or best-price rule is the current guarantee that ensures a fair 
and level playing field for all investors, large or small.  The best price rule 
is also in keeping with the spirit of America’s free-enterprise system, 
promoting competition and transparency, making it the envy of the world. 

The proposed opt-out provision would disadvantage investors, particularly small 
ones. It would empower some investor representatives to opt-out of best-price 
execution for their clients, disadvantaging small investors, benefiting some 
investor representatives. Elimination of the trade-through rule, and 
implementation of an opt-out provision, would be bad for America’s small 
investors, and for America’s financial markets.  Given the bad publicity that 
our markets have faced in recent years, and the need for the SEC to help restore 
investor confidence rather than destroy it, I am convinced that it is essential 
that the SEC maintain the current trade-through or best-price rule, guard 
against anything that could harm market quality, equality, and fairness, and 
ensure that our financial markets remain the best in the world for all current 
and future investors.

Thank you for your consideration of my comments.

Sincerely yours,


Craig G. Rennie, Ph.D.
Assistant Professor of Finance
Sam M. Walton College of Business
WCOB 302
1 University of Arkansas
Fayetteville, AR 72701-1201
479-575-7496
crennie@walton.uark.edu