Commentary

Tim Quast
Traders Magazine Online News

We're All HFTs Now

In this guest commentary, author Tim Quast looks back at the history of HFT and how the market has evolved to where many firms now fit the definition of high-frequency trader.

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November 1, 2004

Trading Fees on the Rise

By Editorial Staff

Do as much trading now as possible. A major cost is a bargain now, but it will just get more expensive in a few months or so.

That's the view some traders could take as the Securities and Exchange Commission announced its fee rate schedule for the fiscal year, which began on October 1. The Section 31 fee rate will rise from $23.40 per million to $32.90 per million. But there's one loophole. The higher rate doesn't go into effect until Congress approves the SEC's regular annual appropriation. And Congress, as Traders Magazine went to press, was not in session. It was not expected to return until sometime in November at the earliest. Meanwhile, the lower Section 31 rate remains in effect.

"Even though the fiscal year begins in October, Congress sometimes hasn't gotten around to our appropriation until February," said John Nestor, a spokesman for the SEC. Whenever the higher Section 31 rate goes into effect, trading executives said they weren't surprised. The rate is paid to help fund the costs of regulation. One executive said the new hike was caused by "reduced volume coupled with lower prices."