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2011 Survey Reveals Minimal Impact of Financial Regulation on Traders

TradeTech, the most widely recognized event covering equity trading and technology challenges, today announced the results of its annual equity trader survey. The survey was conducted within TradeTech’s trading community and examined traders’ opinions and concerns about how potential financial regulations could affect the current market.

The survey found that since final rules have yet to be established under Dodd-Frank, the impact of the regulation is still questionable. The majority of traders are waiting for the final ramifications of the Dodd-Frank bill to be established before implementing any changes to the trading desk. The survey showed that traders hold a negative sentiment toward Dodd-Frank, with 40% of traders believing that the legislation will have a negative impact on their business for the upcoming year.

“The survey revealed that we’re still in a ‘wait-and-see’ mode. As the final legislation takes shape, traders are waiting to see what the fall-out will be before making any tangible changes to their businesses,” says Sara Mueller, Executive Director, TradeTech USA. “Our annual gathering in March will bear interesting discussions and debates on what 2011 will hold for the new market structure.”

Other results include:

•More than half of the respondents believe that High Frequency Trading will prove to be a successful strategy for options as it has been in the equities space.

•Despite increased regulations aimed at derivatives, over 57% of traders believe that the amount of options they will trade in 2011 will remain stagnant, while over 35% believe this amount will increase.

“The results of this survey reflect the state of many firms at this stage,” commented Mayiz Habbal, Senior Vice President and Head of Securities and Investments at Celent. “There is a broad feeling of uncertainty regarding the legislation and the rules that it will establish. It is interesting that some respondents who are still waiting to see the rules are able to classify its impact as positive or negative on their business at this stage.”