From: Bill Surman [bill@rock-island.com]
Sent: Monday, November 12, 2001 3:52 PM
To: rule-comments@sec.gov
Subject: S7-14-01

The Rock Island Company
200 West Jackson Blvd.
Chicago, IL 60606


November 12, 2001

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

Re: File No.: S7-14-01 -- Decimal Trading in Subpennies

Dear Mr. Katz:

In this year of significant structural changes for our industry, a move to
trade and quote securities transactions in increments of less than a penny
would not provide any meaningful benefits for investors.

Your concept release correctly identifies the many drawbacks of trading and
quoting in sub-penny increments.  One benefit of decimal trading was to
simplify pricing for the public.  It is far easier for the investing public
to understand prices in pennies than in 1/16th fractions.  Sub-decimal
pricing, with four or more decimal places, could once again create
confusion.

Trading in decimals has frequently made it more difficult to determine
meaningful buy and sell interest.  Sub-decimals will further obscure the
meaningful market.  In addition, the whole concept of order priority would
be destroyed.  Since there would be no cost to step ahead of another’s
order, liquidity would rarely be committed to the market in the form of a
limit order.

The most important question is whether these narrower spreads would provide
any meaningful savings for the investor.  With the average public order less
than 400 shares, the value of one-half of a cent differential is less than
$2.   Many transactions could take place at even smaller differentials
resulting in truly meaningless changes in value.

Missing from your analysis are any material benefits for investors of
sub-decimal pricing. Sophisticated traders may benefit in some instances,
but the investing public would not.  If the market were to go to sub-penny
increments, the incremental costs of reducing the MPV will be significant.
The incremental benefits will be non-existent.


Yours truly,


Andrew A. Davis					William R. Surman
Chairman						Senior Vice President