Back to the Future: Why the Tick Pilot Has Little Chance of Spurring Permanent Change
The SEC’s Tick-Size Pilot is an excellent experiment that is destined for the market structure scrap heap. By most measures, the current market structure would display not only better, but demonstrably better market quality statistics than any of the pilot programs. But there are enough market structure naysayers and questions about the impact on spreads to the wider economy that it is important for these tests to be run.
In “Back to the Future: Why the Tick Pilot Has Little Chance of Spurring Permanent Change,” TABB Group examines the likely outcomes of the various Tick Pilot test scenarios and explains why we think the program won’t go anywhere.