Who Benefits From Market Speed Bumps? The Exchanges

<p class="story-body-text story-content" data-para-count="159" data-total-count="159">Since the election, stock prices have risen sharply on hopes that a wave of pro-growth policies under Donald J. Trump will drive up equity prices even further.</p> <p class="story-body-text story-content" data-para-count="166" data-total-count="325">But Mr. Trump’s administration will soon face a trend that threatens to move the long-term benefits found in stock markets away from investors and toward exchanges.</p> <p class="story-body-text story-content" data-para-count="166" data-total-count="325">Continue reading in The <a href="http://www.nytimes.com/2016/12/23/business/dealbook/who-benefits-from-market-speed-bumps-the-exchanges.html?_r=0">New York Times</a></p> <p class="story-body-text story-content" data-para-count="166" data-total-count="325"><em>Holly A. Bell is an associate professor at the University of Alaska in Anchorage and a consulting scholar on financial market structure and regulation. She is also the author of the thriller <a href="https://www.amazon.com/Trading-Salvos-Kate-Adams-Novel-ebook/dp/B01H0OOUE0">“Trading Salvos.”</a></em></p>

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Stock Market

My latest on CNBC: Why the SEC should just say ‘no’ to IEX

<section class="cols2"> <div class="unit col1"><article> <div class="story"> <div id="article_body" class="content"> <div class="group-container "> <div class="group"> <div class="story-top"> <div class="story-header-left twoCol"> <div class="source">By UCLA Professor Avanidhar Subrahmanyam and University of Alaska Professor Holly Bell</div> </div> </div>   Since IEX submitted an application last year to the <a href="http://www.cnbc.com/sec/" target="_blank">SEC</a> to become a public stock exchange, a big debate has erupted about a seemingly small time frame — 350 microseconds. IEX's proposed exchange would implement an intentional delay of 350 microseconds to incoming and outgoing information, except for a few select order types. </div> </div> <div class="group-container "> <div class="group"> The debate has led the SEC to issue an interpretive release, which in short asks: Do delays under 1,000 microseconds pose a problem for equity market structure? In the short term, the answer will affect IEX's application to become a recognized national exchange. Long term, the answer could redefine the foundation of equity market structure. Here's our answer: Deliberately adding any amount of latency to the current market system would be

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