Statement at the Roundtable on Options

Good morning. Thank you to the Division of Trading and Markets (the “Division”) and other staff of the Commission for organizing this roundtable on options market structure.[1] Many thanks to our participants, who have taken the time to join us today. We look forward to hearing your thoughts.

For as long as I can remember, equity market structure – and to a lesser extent, fixed income market structure, has taken center stage in the Commission’s public and regulatory dialogue. In fact, over the years, we have convened advisory committees in both of those areas. Issues like fragmentation, concentration, data asymmetries, and uneven execution quality have been studied extensively on the equity side. But data recently released by the Commission makes clear that many of the concerns long debated in equities exist to an even greater degree in options.[2]

During the last ten years, the options landscape has transformed dramatically. Growth in retail participation, particularly in short‑dated and ultra‑short‑dated strategies, has reshaped order flow dynamics, execution pathways, and the economics of liquidity provision. These developments should cause us to reconsider the assumptions behind our existing regulations. For example, how does the increasing fragmentation—15 exchanges with >1% market share—affect the execution quality of retail marketable orders?

We should also consider issues in the institutional space—such as the practical effects of market maker entitlements, data asymmetries, and competitive barriers. Do today’s institutional market makers still require the types of incentives and entitlements that exist in current floor auction rules? Or has the market evolved to a point where those mechanisms should be revisited?

The Commission should optimize regulations for all types of market participants, including individuals who are often the beneficiaries of institutional investors. I look forward to public feedback on how our rules can be modernized to strengthen execution quality, enhance competition, and ensure the options market can effectively serve investors, institutions, and issuers alike. The data is clear—and the moment is right—for thoughtful, measured reform. I thank Chairman Atkins for convening this options market structure roundtable.