Posted On: 04/01/2014 7:27:18 PM
Post# of 4611
SEC Investigations Into High-Frequency Trading Under Way
SEC and CFTC Are Looking Into Ties Between High-speed Traders and Major Exchanges
By Andrew Ackerman connect
Updated April 1, 2014 6:17 p.m. ET
http://online.wsj.com/news/articles/SB1000142...iew_latest
WASHINGTON—U.S. securities regulators are examining whether some rapid-fire trading firms are engaged in unlawful trading practices, Securities and Exchange Commission Chairman Mary Jo White said Tuesday.
Ms. White, testifying before a House Appropriations subcommittee, said the SEC currently has "a number" of ongoing investigations regarding "market integrity and structure issues, including high-frequency traders." She declined to provide specifics about the investigations, but said they have been under way for "quite some time."
"We're very much focused on any abuses in that space," she said.
Her comments come a day after revelations the Federal Bureau of Investigation is probing whether high-speed firms are engaging in insider trading by taking advantage of fast-moving market information unavailable to other investors.
The SEC and the Commodity Futures Trading Commission are looking into ties between high-speed traders and major exchanges, examining whether the firms are getting preferential treatment that puts other investors at a disadvantage, people familiar with the probes said Monday.
The probes illustrate a bigger push by regulators to examine less-transparent parts of the securities markets, particularly high-frequency trading firms that use powerful computer systems for rapid-fire trades in which they often hold stocks for only fractions of seconds. They benefit by being able to move more quickly than less technologically proficient investors.
Defenders of high-frequency trading, in which firms send waves of buy and sell orders into the market, say it makes trading more efficient and cheaper for everyday investors.
Ms. White acknowledged the SEC is in the midst of a policy debate on whether the speed and complexity of trading in stocks and other securities pose risks to markets. She said the SEC's approach on the issues would be "data-driven and disciplined." She stopped short of embracing any policy shifts.
The review of the guts of the stock market follows a string of market breakdowns, such as last year's failure of the Securities Information Processor, a computerized link that transmits market orders to the public and is overseen by the Nasdaq Stock Market.
—Scott Patterson contributed to this article.
Write to Andrew Ackerman at andrew.ackerman@wsj.com
http://online.wsj.com/news/articles/SB1000142...iew_latest
SEC and CFTC Are Looking Into Ties Between High-speed Traders and Major Exchanges
By Andrew Ackerman connect
Updated April 1, 2014 6:17 p.m. ET
http://online.wsj.com/news/articles/SB1000142...iew_latest
WASHINGTON—U.S. securities regulators are examining whether some rapid-fire trading firms are engaged in unlawful trading practices, Securities and Exchange Commission Chairman Mary Jo White said Tuesday.
Ms. White, testifying before a House Appropriations subcommittee, said the SEC currently has "a number" of ongoing investigations regarding "market integrity and structure issues, including high-frequency traders." She declined to provide specifics about the investigations, but said they have been under way for "quite some time."
"We're very much focused on any abuses in that space," she said.
Her comments come a day after revelations the Federal Bureau of Investigation is probing whether high-speed firms are engaging in insider trading by taking advantage of fast-moving market information unavailable to other investors.
The SEC and the Commodity Futures Trading Commission are looking into ties between high-speed traders and major exchanges, examining whether the firms are getting preferential treatment that puts other investors at a disadvantage, people familiar with the probes said Monday.
The probes illustrate a bigger push by regulators to examine less-transparent parts of the securities markets, particularly high-frequency trading firms that use powerful computer systems for rapid-fire trades in which they often hold stocks for only fractions of seconds. They benefit by being able to move more quickly than less technologically proficient investors.
Defenders of high-frequency trading, in which firms send waves of buy and sell orders into the market, say it makes trading more efficient and cheaper for everyday investors.
Ms. White acknowledged the SEC is in the midst of a policy debate on whether the speed and complexity of trading in stocks and other securities pose risks to markets. She said the SEC's approach on the issues would be "data-driven and disciplined." She stopped short of embracing any policy shifts.
The review of the guts of the stock market follows a string of market breakdowns, such as last year's failure of the Securities Information Processor, a computerized link that transmits market orders to the public and is overseen by the Nasdaq Stock Market.
—Scott Patterson contributed to this article.
Write to Andrew Ackerman at andrew.ackerman@wsj.com
http://online.wsj.com/news/articles/SB1000142...iew_latest
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