LTSE opposes SEC move to rescind Rule 611 in U.S. equity market overhaul

Traders Union
All News
Financial Institutions
LTSE opposes SEC Rule 611 repeal

Highlights

Long-Term Stock Exchange opposes SEC's proposal to rescind Rule 611, arguing its removal would erode public limit order display and price discovery.
LTSE contends the SEC lacks empirical evidence that rescinding Rule 611 would cut costs or boost competition without harming market quality.
LTSE advocates for targeted modernization of Rule 611, including possible block-trade exemptions, while maintaining intermarket price protections vital for liquidity and execution quality.

LTSE comments challenge full rollback

As reported by Long-Term Stock Exchange, the exchange has submitted a comment letter opposing the U.S. Securities and Exchange Commission's proposal to rescind Rule 611, while taking no position on the proposed removal of Rule 610(e), the provision covering locked and crossed markets.

LTSE says the SEC's stated goals of reducing unnecessary complexity and encouraging competition do not justify eliminating Rule 611. The exchange argues that the rule's bright-line protections cannot be replaced by broader best-execution obligations, which it characterizes as more subjective and less effective at preventing trade-throughs.

In LTSE's view, removing those protections would weaken incentives to display limit orders in public markets. It says that outcome would directly erode price discovery and conflict with the objectives of Section 11A of the Exchange Act, which underpins the national market system.

Implications for trading competition and market quality

LTSE also argues that the SEC has not presented sufficient empirical support for the assumption that rescinding Rule 611 would reduce costs without harming competition among exchanges. The letter says the proposal relies on unproven claims about exchange proliferation and the burden of intermarket connectivity.

Instead of a full rescission, LTSE calls for targeted modernization of the rule, including potential block-trade exemptions, while preserving the core intermarket price protections. The exchange says Rule 611 still serves two key functions, encouraging the display of non-marketable limit orders that support liquidity and market depth, and reducing the risk that market orders and marketable limit orders are executed at prices worse than accessible displayed quotes.

In our earlier article on insider buying at CMC Markets following its upgraded income guidance, we explained how the company lifted its net operating income target for the year to March 2027 and outlined the associated EBITDA and cost expectations. We also noted that the purchases by Lord Cruddas and David Fineberg came alongside strong recent performance and a growth narrative tied to business-to-business platforms and the Westpac partnership pipeline.

This material may contain third-party opinions, none of the data and information on this webpage constitutes investment advice according to our Disclaimer. While we adhere to strict Editorial Integrity, this post may contain references to products from our partners.