Perspectives & Key Themes from Market Participants on Equities and Options

Recently, SIFMA hosted our annual Market Structure Conference, with a full day dedicated to listed options and equities. Across the two days, we gained insights into top-of-mind topics for market participants. Inside this note, we recap just some of what was seen and heard, including:

• The Industry Outlook – Equity markets update, plus views from the buyside such as top business priorities for firms; options market update, key trends such as zero-days-to-expiration options (0DTE); also includes pre conference survey results on market statistics, macro themes, and economics trends.
• The Regulatory View – Markets are now considering six major rule proposals which could significantly impact equity and options markets (Rule 605, tick sizes, best ex, auctions + volume tiering + predictive data analytics). Concerns include the volume and speed of proposals, the complexity they introduce, and the potential for unintended consequences. The SEC did not analyze how the different proposals would interact with each other, i.e. interconnectedness. Timelines for implementation of the many rules are another area of concern for market participants, especially with 195 days to the go date for the transition to T+1 settlement.
• More on Market Themes – The focus is on trends in retail trading for both equities (ETFs, 24-hour trading, fractional shares, sub-dollar stocks) and options (growth in trading of 0DTE).

Contents

• The Industry Outlook
  • Market Touchpoint: Markets & Volatility
  • Market Touchpoint: Trading Volumes
  • Market Touchpoint: Macro Themes
  • Market Touchpoint: Economic Themes
  • Equity Markets
  • Multi-Listed Options Markets
• The Regulatory View
  • Market Touchpoint: Equity Market Structure Reform
  • Market Touchpoint: Other Regulations
  • The SEC Agenda
  • General Concerns
  • Interconnectedness of the Proposals
  • Implementation Timelines
  • More on the Six Proposals
• More on Market Themes
  • Trends in Retail Trading: Equities
  • Trends in Retail Trading: Options
  • New Exchanges

Author

SIFMA Insights
Katie Kolchin, CFA

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