Retail investors are not being fleeced by high-frequency traders using programs to jump ahead with buy and sell orders that fetch better prices, SEC Chair Mary Jo White asserted April 29. “The markets are not rigged,” White told a hearing held by the U.S. House of Representatives’ Financial Service Committee.
According to a Reuters report on the hearing, White also sought to dispel the notion that using high-speed technologies to trade ahead of others using stock quotes disseminated on public data feeds could meet the definition of unlawful insider trading.
White’s comments marked her first response to allegations in Flash Boys: A Wall Street Revolt, Michael Lewis’ new book about high-speed traders. White also noted that the SEC is actively pursuing probes into high-speed traders and dark pools, defended the current functioning of the market and rejected claims that small individual investors are being harmed by high-speed trading. “I want to be very clear that the market metrics suggest that the retail investor is … very well served by the current market structure,” she asserted.
