The head of the
Noel Archard, a managing director at investment adviser BlackRock in charge of its
- Uniform “circuit breakers” for stocks and ETFs across all exchanges
- Exchange trade error cancellation rules which are less arbitrary and more transparent
- Clearer guidelines for inter-market order routing rules
- A replacmeent of “stop loss” orders with “stop loss limit” orders to specify a limit price, and
- Expanding the role of lead market makers to ensure orderly market functioning
ETFs have become widely accepted investment vehicles for both institutional and retail investors, Archard noted. There are currently 985 exchange-traded products available in the U.S. market with $797 billion in assets invested. They represent 30% of the total volume traded on national exchanges, he said.
And a recent BlackRock iShares survey of financial advisors called the Flash Crash Perceptions Study identified ETFs as the best investment vehicles to navigate a volatile market environment followed by bonds and mutual funds.
The survey revealed that the majority of advisers were minimally impacted by the market disruption, and they believe that market structure issues, such as an overreliance on computer systems and some types of high-frequency trading, were the primary drivers of the crash.
The SEC on June 10 approved rules which require national exchanges to pause trading in
"This pause, currently applied on a pilot basis, gives the markets the opportunity to attract new trading interest in an affected stock, establish a reasonable market price, and resume trading in a fair and orderly fashion,'' she said.
The breaker policy may soon get extended to ETFs.
In June, the SEC published for comment proposals by the exchanges and the
Comments on the proposal are being reviewed and Schapiro said "I hope we will have approval of this phase of circuit breakers soon."
