New proposals to introduce a trading system which would enable greater analysis of participants and their activity have been unveiled by the Securities and Exchange Commission (SEC).
According to the regulator, ‘larger’ traders would be required to make a filing to the SEC before receiving a number of identification.
Broker dealers would then receive the number, which would enable more efficient tracking of traders and their activity, the organisation explained.
Mary L Schapiro, SEC chairman, said: “This rule is designed to strengthen our oversight of the markets and protect investors in the process.
“It would give us prompt access to trading information from large traders so we can better analyze the data and investigate potentially illegal trading activity.”
The SEC defines a ‘large’ trader as an individual or firm whose transactions exceed $20 million or two million shares on any calendar day.
Previously, the commission has proposed a number of changes to legislation to improve fairness within the trading markets.
They included banning unfiltered access to markets and providing more transparency to liquidity dark pools.
By Jim Ottewill