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April 30, 2021

Defense of New Order Type to Help Retail Investors

Better Markets championed retail investors in an amicus brief that defended a new order type developed by IEX that helps everyday investors fight back against high-frequency trading (HFT) abuses.
In our brief, we explain the huge advantages that HFT firms like Citadel Securities enjoy and the harm they inflict on investors. We also show how the D-Limit Order, which automatically resets its price when HFTs are about to strike, helps neutralize the HFTs’ unfair advantage.  
Why it matters? The outcome of the case, Citadel Securities LLC v. Securities and Exchange Commission, will have a significant impact on the ability of everyday investors to protect their money from being siphoned away by HFT firms. 
What we said. That’s why we weighed in to help defend the new order type developed by IEX, an investor-friendly exchange that has earned our praise since it was founded in 2016. The SEC rightly approved that order type late last year, but Citadel is fighting to protect its ability to generate near-certain profits—to print money in effect—through privileged data access and sophisticated trading technology.
Bottom line. Fortunately for investors, the SEC’s mission is to protect investors and the integrity of the markets, not Citadel’s coveted business model, so it approved the IEX order type in accordance with the securities laws and all the requirements surrounding rulemaking. We urged the Court to affirm the SEC’s decision.”
Read our release.
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