The SEC is exploring whether to tweak its trade-through prohibition amid criticism that the current rule forces some market participants to worse-than NBBO pricing after fees and rebates are considered.
The SEC aims to reassess the “trade‑through” prohibition enacted by Rule 611 in 2005; the rule forces trading venues to execute at, or route orders to, the national best bid or offeror better. Announcing the event, chair Paul S. Atkins said: “Reg NMS and its Rule 611 have not served investors or broker‑dealers well, given the market distortion and resulting gamesmanship by those that seek to take advantage of the Reg NMS structure.”
Joe Saluzzi, partner and co-founder at Themis Trading told Global Trading that: ”Atkins is correct and Rule 611 should be reviewed. Reg NMS shattered the equity market causing liquidity to disperse amongst dozens of exchanges and off-exchange venues. Displayed liquidity shrunk and the average trade size plummeted. HFTs were quick to jump in to take advantage of latencies between these market centers and the stock exchanges were more than happy to arm them with the tools that were necessary. The SEC needs to figure out a way to put the pieces back together and a review of Rule 611 is a good start.
Several research papers have been presenting evidence supporting this affirmation. Sida Li, Mao Ye and Miles Zheng in their paper from 2021 titled “Refusing the Best Price?” say “As the NBBO ignores exchange fees, 62 % of routings lead to worse net prices.” Their study finds that brokers often bypass the apparent best quote when fee differentials make another venue cheaper once costs are netted out.
In the paper “Does maker-taker limit order subsidy improve market outcomes?”, Yiping Lin, Peter L. Swan and Frederick H. de B. Harris go further: “The regulatory requirement that trading and order flow depend only on raw (nominal) spreads and prices underpins the multi‑billion‑dollar subsidy to limit orders
Our own Global trading study of lit continuous trading finds that 2% of trades happen at worse prices than the NBBO.
Rule 611 was introduced in 2005 to prevent one marketplace from selling stock at a price inferior to a protected quotation displayed elsewhere. Critics argue that the rule looks only at the nominal price and ignores the exchange access fees and rebates that determine an investor’s net execution cost.
The roundtable planned for 18 September gives market participants the opportunity to express their view on the need for it to still exist.
Sandro Oswald, quantitative trader for the central risk book, Susquehanna
Sandro Oswald has joined Susquehanna as a quantitative trader for the central risk book. He is based in London.
Susquehanna executed 7.7 billion shares in May 2025, according to Global Trading analysis, with price improvements of US$55.7 million provided to retail traders down more than 20% on April figures. Execution quality also declined.
Oswald joins the company after almost a decade at Morgan Stanley, where he was most recently co-head of the centralised risk book and systematic market making for the EMEA region, covering cash equities and Delta 1. Prior to this, he was a quant trader for ETFs and equities.
Earlier in his career, Oswald was an ETF quant trader at KCG Holdings and Bank of America Merrill Lynch’s quantitative statistical arbitrage group. He also spent five years at Interactive Brokers, leading ETFs and structured products for the Swiss Timber Hill business.
UBS AM: Markets brace for the tariff volatility, and concerns develop over “irrational optimism”
While markets have been trading at all-time highs, Stuart Lawrence, head of equities at UBS Asset Management, warns of a potential market pullback in September as tariffs take effect and looks at whether the market’s “irrational optimism” could collide with the hard economic data.
The return of calmer market conditions after April’s tariff turmoil led to slimmer pickings for giant market makers, as the price improvement offered to retail plummeted. This came as retail flows increased, even though overall volumes declined, Global Trading analysis shows.
As equity markets returned to a lower volatility regime in May, the price improvement offered by market makers to retail brokers declined, according to Global Trading analysis of regulatory filings. Execution quality improved at some firms and deteriorated at others but all the biggest markets beat the US national best bid offer (NBBO) based on effective-to-quoted spread ratio (E/Q) analysis.
We analysed the SEC Rule 605 disclosures of Citadel Securities, Virtu, Jane Street, G1 (part of Susquehanna), Hudson River Trading (HRT), and Two Sigma Securities.
As in April, Citadel led execution and improvement statistics having executed 27.2 billion shares and provided retail with US$131.8 million of price improvement covered within the current 605 disclosure regime. That compares with $160 million of improvement in April. Virtu followed with 15.4 billion shares executed and US$81.2 million of improvement, versus $109 million in April.
Meanwhile, G1 (Susquehanna), Jane Street, HRT, Two Sigma executed 7.7 billion, 8.8 billion, 6.1 billion and 2.2 billion shares respectively. In the same order, they provided retail traders with US$55.7 million, US$ 46 million, US$ 33.2 million and US$9.8 million of price improvement versus quoted spread. All these improvement amounts were more than 20% lower than the previous month.
The graph above presents the cumulative distribution for the selected market maker, along with the equivalent distribution for a sample of the whole continuous lit market. For this ‘All trades’ measure, we look only lit trades whose bid-ask spread is greater that US$0.001, bid and offer size if superior to one lot, and quotes are less than 25 milliseconds old. Our sample in May represents 73.4 billion shares traded with US$3.95 trillion of notional versus 89.6 billion shares traded with a notional of US$4.8 trillion in April.
We plot this ‘All trades’ measure against the E/Q of individual market makers both in terms of shares traded or in terms of notional. To recreate approximate notional for market makers, we used the monthly volume weighted average price (VWAP) of each ticker as calculated from our market sample as the relevant price for each ticker in their disclosure.
The cumulative distributions show significant differences in execution quality between different market makers as well as variations over time. For example, in May, Citadel shows the highest execution quality with 50% of trades with E/Q below 0.45, while Two Sigma has the worst, with median E/Q of 0.50. Execution quality for all six market makers changed since April, with Citadel and Two Sigma showing an improvement while Virtu, Susquehanna and Jane Street showing a decline.
For the ‘All trades’ measure, 90% of trades occur with E/Q of one, or on the NBBO in other words. However, a substantial proportion, 10% to 15% depending on weighting methodology, of lit market trading happens at mid.
As volatility decreased in May, bid ask spreads tightened and the opportunity for market makers to improve on it despite larger volume traded also dwindled.
Market maker execution disclosures exhibit further differences. Price improvements at both Citadel Securities and Virtu follow the density distributions of their share weighted E/Q, while for Jane Street, price improvement is skewed suggesting a specialization in where they provide price improvements.
Other notable differences happen at the order size level. The current Rule 605 disclosure requires the market makers to disclose execution quality for order size 100 to 499, 500 to 999, 1000 to 4999 and 5000 to 9999 shares.
For the whole panel the total price improvements provided by the market makers are disproportionately allocated to the lower order size compared to the bigger one.
In the below example one can see for example that while the 100 to 499 shares size bucket represented only 12.9% of the shares executed by Virtu in May, these orders got provided and with 34.8% of the total improvements Virtu offered retail traders, and an E/Q of 0.33, while the 5000 to 9999 represented 31.2% of the shares traded at Virtu but only 9.1% of the total price improvement at an E/Q of 0.7. Similar patterns are visible at all the market makers on the panel we studied. We provide data for Two Sigma as another such example.
Virtu told Global Trading that these outcomes are “an artifact of the current rule 605 methodology”.
Academic research suggests that retail broker focus on different order types (such as small or large orders) is mirrored by market makers that compete and adapt to capture their flow. The SEC’s upcoming improved Rule 605 disclosure is likely to allow a far more detailed analysis of brokers and market makers practices.
Bryan Green, director of ETF capital markets, Janus Henderson Investors
Bryan Green has joined Janus Henderson Investors as director of exchange-traded product (ETP) capital markets. He is based in New York.
In the newly created role, Green will help to develop and launch new ETP products and support the firm’s ETP trading ecosystem. He reports to Jay Kirkorsky, head of ETP capital markets.
According to VettaFi data, Janus Henderson ranks 32nd in the ETF issuer league table by revenues.
Green has 25 years of experience and joins the firm from BlackRock, where he was head of US ETF product integrity.
Across the Atlantic, BlackRock suffered a blow earlier this year when its EMEA head of iShares equity product strategy and markets coverage Ross Finlayson left the firm for Amundi.
Earlier in his career, Green was director of ETF and index strategy at ICE. Prior to this, he spent more than seven years at Bloomberg as an ETF product specialist and, later, head of ETF and index strategy.
Christopher Cosimano has started as head trader at Estuary Capital Management in Wayzata, Minnesota.
He moves to the buy side after a year at TP ICAP, where he worked in institutional sales and outsourced trading, and nearly 14 years as an institutional equity sales trader at MND Partners. Earlier in his career, Cosimano held similar roles at Kellogg Partners (2010–2011) and R&H Partners (2007–2010).
According to its latest 13F filing, Estuary Capital Management had US$420 million of assets under management as of June 2024 and runs fundamental long-short equity funds.
Natalie Khoury, Asia equity sales trader, Goldman Sachs
Natalie Khoury has joined Goldman Sachs as an Asia equity sales trader, based in New York.
Goldman Sachs saw a record equity trading revenues of US$4.3 billion in Q2 2025, putting it well ahead of its competitors. Asia markets currently contribute just 12% to the bank’s net revenues.
Khoury has more than a decade of industry experience and has spent the last year at Berenberg Capital Markets as an equity sales trader. Prior to this, she was an equity trader at BlackRock for eight years based in both Hong Kong and New York.
Earlier this year, APAC co-head of equity derivatives and head of exotics equity derivatives trading Paul Johnson left Goldman Sachs to lead Barclays’ APAC equities arm.
More recently, Scott Rubner, Goldman’s managing director for global equity macro, emerging markets, equity derivatives and tactical flow of funds, joined Citadel Securities at the start of this month.
Chris Tufano has joined Clear Street as head of clearing.
In the New York-based role, Tufano is responsible for building out the company’s professional clearing services, which were launched for US equity market makers in 2024.
On his appointment, Tufano said, “I’ll be working hand in glove with a world-class team to deliver a seamless, global client experience – one platform with a single point of entry for all markets and asset classes.”
Tufano has more than 25 years of industry experience and joins Clear Street from Bank of America, where he has been global head of prime brokerage and clearing platform transformation since 2016.
Prior to this, he was an executive director at Morgan Stanley and head of the broker dealer clearing business.
Clear Street recently appointed UBS alum Morgan Ralph as head of its new outsourced trading division, following UBS’s exit from the outsourcing business.
After paying US$275 million for options order flow between April 2024 and March 2025, Morgan Stanley has given up on electronic options market making – selling the business arm to juggernaut Citadel Securities.
Reports that Morgan Stanley was closing its options market making unit emerged in June and follow the shuttering of its electronic equity market making business last month. The firm was one of the few traditional banks still paying for options order flow, competing with faster prop trading firms – like Citadel Securities.
Perhaps explaining Morgan Stanley’s decisions to sell, in the company’s Q2 results call CEO Ted Pick commented, “The cost to run [the equities] business has only gone up. And so not surprisingly, the top of the competitive heat is able to endure operating leverage and above-market returns, and the rest have to slug it out just to sort of make the nut.”
In the US, market makers paid more than US$1.19 billion for equity and options order flow in the first three months of 2025. Citadel Securities dominated the statistics, followed by Susquehanna and, increasingly, ION/IMC.
Citadel Securities states that it is the number one US retail options market maker, making markets across 1.3 million options spanning more than 20 exchanges and six countries. In March the firm spent US$85.9 million for options order flow, according to S3 data. Morgan Stanley, by contrast, paid US$26.7 million.
Alexei Jourovski has been appointed chief executive office of Kepler Unigestion, following the February announcement of the strategic partnerhip between Kepler and Unigestion
Jourovski moves up after 24 years at Unigestion, where he was most recently managing director and head of equities (2011–2025) following earlier roles as head of investments, quantitative equities (2005–2010) and investment manager (2001–2004).
Commenting on his appointment he said: “Excited to begin a new chapter as CEO of Kepler Unigestion – a bold new venture at the intersection of advanced AI and human insight, with the mission to reshape the future of equity investing.
We're Enhancing Your Experience with Smart Technology
We've updated our Terms & Conditions and Privacy Policy to introduce AI tools that will personalize your content, improve our market analysis, and deliver more relevant insights.These changes take effect on Aug 25, 2025. Your data remains protected—we're simply using smart technology to serve you better. [Review Full Terms] |[Review Privacy Policy] Please review our updated Terms & Conditions and Privacy Policy carefully. By continuing to use our services after Aug 25, 2025, you agree to these
