SEC Considering Changes to Best-Price Rule

The Securities and Exchange Commission may require that the New York Stock Exchange revise the rule that forces markets to get investors the best price, even if it means they have to go to a competing market to get it, the Wall Street Journal reported.

SEC staff favor allowing trade execution speed to take precedence over getting a better price, a recommendation that may be included in market structure changes the SEC will take up later this month, the Journal reported.

The NYSE’s chief competitors, including Nasdaq, Instinet Group and Archipelago Exchange, have long been in favor of the SEC eliminating the "trade through" rule, the Journal reported. The competitors believe the rule gives the Big Board unfair advantages. California controller Steve Westly agreed this week, writing to SEC Chairman William Donaldson saying, "the trade-through provision is obsolete."

Donaldson and other commissioners have said that investors should be able to decide whether they favor speed over best price. Other SEC officials told the Journal that the rule makes for inconsistencies between floor-based exchanges like the NYSE and electronic markets like Nasdaq that create disadvantages for investors.

Thain prefers that the SEC mandate automatic execution over an exception to getting investors the best price, the Journal reported. Yet the SEC has been clear that it wants to update the rule and the change could force the NYSE to better automate its systems, a move Thain said earlier this week that he supports.

You may like these other stories...

The US Securities and Exchange Commission (SEC) has chosen a former partner and vice chairman with Deloitte LLP as its new chief accountant.James Schnurr, who specialized in financial and SEC reporting for public companies...
Summer is a time for kicking back and playing a few round of golf with friends, for example. But if you're on the green, you'd better be careful: The SEC may be looking over your shoulder.In July, the SEC announced...
An examination initiative launched by the US Securities and Exchange Commission (SEC) earlier this week will enable the agency to evaluate whether municipal advisors are complying with new SEC rules that went into effect...

Already a member? log in here.

Upcoming CPE Webinars

Sep 24
In this jam-packed presentation Excel expert David Ringstrom, CPA will give you a crash-course in creating spreadsheet-based dashboards. A dashboard condenses large amounts of data into a compact space, yet enables the end user to easily drill down into details when warranted.
Sep 30
This webcast will include discussions of important issues in SSARS No. 19 and the current status of proposed changes by the Accounting and Review Services Committee in these statements.
Oct 23
Amber Setter will show the value of leadership assessments as tools for individual and organizational leadership development initiatives.
Oct 30
Many Excel users have a love-hate relationship with workbook links. For the uninitiated, workbook links allow you to connect one Microsoft Excel spreadsheet to other spreadsheets, Word documents, databases, and even web pages.