Salil Pachare and Ilia Rainer
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Does the Tick Size Affect Stock Prices?

The Securities and Exchange Commission has recently released a whitepaper examining the change in tick sizes on trading based on data it collected during the Tick Size Pilot.

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August 31, 2002

Can Markets Work During Emergencies?

By Gregory Bresiger

Trade execution information links must be improved so that markets can continue to function even in times of "distress and disturbance," a trade group told the regulators.

In a letter to the Securities and Exchange Commission as well as the Federal Reserve Board, the Investment Company Institute (ICI) called for a new method of market participants sharing contingency contact information.

World Trade Center

The letter was triggered by an ICI study that was prompted by last year's disaster in September at the World Trade Center.

"The institute and its members found it extremely difficult, and at times impossible, to communicate with key market participants about ongoing changes to market operations," according to Lawrence Maffia, executive vice president of administration for the ICI.

Open-ended fund companies are required to accept investor orders when markets are open. However, ICI officials complained that after September 11 many of its members reported problems. There was confusion about openings and closings as well as settlement times among market participants. Many were out of the information loop, ICI officials said, and had to rely on press reports.

"A number of participants in all these markets need to hear about changes in practices and procedures due to market disruptions," Maffia wrote.

"These agencies need to talk to a broader group of people to find out how communications can be improved so that the people are well aware of what's happening as it occurs and unfolds," he wrote.