U.S. Securities and Exchange Commission Chair Mary Jo White unveiled the regulator’s most sweeping plan yet for reining in high-frequency trading and monitoring dark pools and other secretive trading practices in the world’s largest equity market.
– The SEC is finally trying to rein in the robots. Chairman Mary Jo White today announced a massive initiative designed to tame high-frequency traders, the Wall Street Journal reports. These automated trades currently make up more than half of all trading volume, yet they've almost totally avoided direct regulatory oversight because the computers are trading on behalf of their owners, not clients. The rules White is proposing would change that, forcing high-frequency traders to register as broker dealers. White also said the SEC was working on rules to prevent the computers from engaging in strategies that put the market at risk of massive swings, like the infamous flash crash. The SEC also introduced plans to affect how human traders operate, Bloomberg adds—the agency is concerned that the stock exchanges have too many types of orders, adding complexity for no reason, and that some traders are using exchange-sold price feeds that are faster than the ones the general public relies on.