The International Securities Exchange and the Boston Options Exchange both wrote to the US Securities and Exchange Commission on November 23, arguing against its proposal to ban flash orders.
But while the ISE closely followed and expanded on the line set by the Chicago Board Options Exchange in its comment letter on November 18 – that flash trading in options is beneficial and it would be quite wrong to ban it – the Boston exchange was willing to countenance curbs and concentrated on arguing that its own practices were not really flash trading and therefore should be exempt.
ISE also took the debate further by suggesting that, rather than banning flash orders, the SEC should address its concerns about a two tier market by making them public. The CBOE considered this idea briefly in its letter but rejected it as a needless waste of resources.
The three exchanges’ letters have...