The Securities and Exchange Commission approved the expansion of its post-Flash Crash circuit breaker program to include all stocks in the Russell 1000 Index and a test group of exchange-traded funds.

The SEC also approved new rules for national exchanges and the Financial Industry Regulatory Authority to follow that clarify the process for breaking erroneous trades, in cases such as the May 6 Flash Crash, when prices fall (or rise) precipitously.

The expansion of the program is expected to take place on the New York Stock Exchange, Nasdaq Stock Market, Direct Edge and BATS exchanges next week.

The Russell 1000 is composed of stocks of corporations with great market value. The weighted average market capitalization of its members is $69.8 billion. Its 10 top holdings are Exxon Mobil, Apple, Microsoft, Proctor & Gamble, General Electric, IBM, JP Morgan Chase, Johnson & Johnson, AT&T and Chevron.

The exchange-traded funds subject to the circuit breaker are widely held, including BlackRock iShares, Invesco PowerShares, State Street Global Advisor SPDR and Vanguard funds.

In the SEC's regime, trading in a security included in the program is paused for a five-minute period if the security experiences a 10 percent price change over the preceding five minutes. The pause gives the markets an opportunity to attract new trading interest in an affected stock, establish a reasonable market price, and resume trading in a fair and orderly fashion.

FINRA Fines Trillium $1M

FINRA censured and fined New York-based Trillium Brokerage Services LLC $1 million for using "an illicit high frequency trading strategy and related supervisory failures."

According to the Washington regulator, Trillium entered numerous layered, non-bona fide market moving orders to generate selling or buying interest in specific stocks through nine proprietary traders. "By entering the non-bona fide orders, often in substantial size relative to a stock's overall legitimate pending order volume, Trillium traders created a false appearance of buy- or sell-side pressure," FINRA said.

This trading strategy induced others to enter orders to execute against limit orders previously entered by Trillium's traders. Once the orders were filled, the Trillium traders would then immediately cancel orders that had only been designed to create the false appearance of market activity.

According to FINRA, as a result of this improper high frequency trading strategy, Trillium's traders obtained advantageous prices that otherwise would not have been available to them on 46,000 occasions.

In addition to the nine traders, FINRA also took action against Trillium's director of trading and its chief compliance officer.

91% of Investors Support Single Fiduciary Standard

At 91%, the overwhelming majority of retail investors support a fiduciary standard for all financial advisers, according to a survey of 1,319 investors by Infogroup/ORC. The survey indicates that there is some surprise among investors-seventy-six percent, to be exact-that their financial advisers aren't, strictly speaking, acting in their best interests now as fiduciaries.

Some 97% of investors agree with the statement (and 85% strongly agrees) that "when you receive investment advice from a financial professional, the person providing the advice should put your interests ahead of theirs and should have to tell you upfront about any fees or commissions they earn and any conflicts of interest that potentially could influence that advice."

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