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SEC Says Heavy Traders Should be Required to Reveal Identities


Wednesday, April 14th, 2010

Regulators from the SEC are pushing for traders regularly moving in and out of the market to be required to reveal who they are in order to see how their fast and frequent trades are affecting the equities markets.

The Securities and Exchange Commission made it unanimous in their vote to be allowed to force these traders to be tagged with ID numbers which would empower the SEC to track the trades they make and to gather data on the trades on what type of impact they are having.

This is a strange and something to be concerned about, as it again is a move by the government to invade our lives, and while there are some traders that move in and out of the markets on and individual and institutional basis, the majority are the giant financial institutions who use algorithms to trade a split second levels to gather the most liquidity they can at the moment of the trade.

So what is it the SEC is really after here, since they know the giant banks and financial institutions are largely the major players here. What do they need to identify since they already know who they are?

There is something missing in the explanation, and until that's properly identified, hopefully this will be rejected. The SEC absolutely knows every major player in the market, whether it's a huge bank or hedge fund, so the idea they don't know who these institutions are is ridiculous. They're obviously after something else than that.

This isn't just about oversight, there's something draconian about the SEC wanting to be able to have access through a tagging system to every trade being made. What happens when they decide to go beyond tagging only institutions? Who's next after that? That's a worrisome thought when you follow it through to its logical conclusion.

Parameters of the proposed tagging to begin with would include those making over $20 million in trades a day or trading 2 million shares or more.

Talk about the ultimate in big brother watching you.



Article by Gary B

The views expressed are the subjective opinion of the article's author and not of FinancialAdvisory.com



Tags: sec , securities and exchange commis , tagging traders , tracking traders