At the Gabelli School, SEC signals a win for individual investors

Featured Events | Mar 15, 2019 | Gabelli School of Business

Being in the global center of commerce has its perks.

So, when the Gabelli School of Business welcomed U.S. Securities and Exchange Commission Chairman Jay Clayton and other top officials to the McNally Amphitheater, the international business press was watching.

Clayton, joined by Brett RedFearn, the SEC’s director of trading and markets, outlined upcoming regulatory changes to the U.S. equity markets on March 8, announcing plans to update and upgrade the system that provides access to market data through two streams: a public core data feed, and other proprietary feeds that are sold in the marketplace.

The announcement was hailed in the press as a potential win for individual investors. Proprietary feeds frequently present richer data, resulting in a disadvantage to institutional investors at mutual and pension funds who, in turn, represent millions of individual investors.

“It’s clear that technology has shifted this regulatory landscape in fundamental ways. Core data may no longer be sufficient…to trade competitively,” Clayton said, adding that an upgraded system might better meet the needs of today’s modern markets.

Redfearn presented an approach to enhancing core data, which has roots dating back to the original National Market System created in the 1970s. His proposal outlined a 7-pronged strategy to address issues of speed, content, order protection, depth of information, governance, transparency and fair access.

“There are a number of important questions and policy initiatives the staff will consider,” Redfearn said. “We place a high value on transparency and exposure, and as we assess how to best reassess and update our regulatory policies related to core market infrastructure, we will remain true to the commission’s core mission to protect investors and maintain fair, orderly and efficient markets and facilitate capital formation.”

Throughout the morning, Clayton and Redfearn gave a complete update on the SEC initiatives completed in 2018, focusing on the feedback provided at roundtable events that were held throughout the year.

The panel gave those in attendance a candid and personal glimpse into what goes into creating the policies responsible for governing the U.S. equity markets, which are the most liquid and efficient capital markets in the world.

Clayton and Redfearn were introduced by Craig Phillips, counselor to the secretary at the US. Department of the Treasury. In between sections of the morning panel, Clayton – the grandson of a Fordham Prep and Fordham University graduate, and also formerly a college professor – took the time to speak to Gabelli students in the room, deviating from his remarks to give color to the technical portions of the session.

Donna Rapaccioli, dean of the Gabelli School of Business, expressed her sincere gratitude to Phillips, Clayton and Redfearn and to event sponsors, the Gabelli Center for Global Security Analysis, the CFA Society of New York and the Museum of American Finance.

“Being in New York and hosting events like this one helps us to deliver on the promise of providing access to business leaders, to policy makers and an incredible range of global opportunities,” Dean Rapaccioli said.

This event was livestreamed and archived.