SIFMA today released the following statement from Randy Snook, executive vice president, in response to a proposal establishing a new limit up-limit down mechanism for stock exchanges to curb unusual volatility in the equity markets. This mechanism would replace the existing single stock circuit breaker pilot program regime that was put in place as a result of the May 6, 2010 Flash Crash.
“Reducing extreme volatility in our markets is essential to restoring and maintaining investor confidence, which in turn sows the seeds for greater capital formation, capital investment, economic growth and job creation. We applaud the SEC, FINRA and the exchanges for working diligently on finding solutions that will address volatility in our markets without hampering proper market function and efficiency. SIFMA and our member firms look forward to reviewing the proposal and providing substantive comments as necessary to further aid the development of these mechanisms that will undoubtedly help restore investor confidence.”