Citadel Securities is suing the SEC for approving a brand new kind of buy order

© Reuters.

From Kanishka Singh

(Reuters) – Citadel Securities, which provides trading services to asset managers, banks, broker-dealers and hedge funds, has sued the Securities and Exchange Commission for its decision to approve a new mechanism for trading stocks at the emerging exchange operator IEX Group Inc.

"The SEC has not adequately considered the costs and burdens of this proposal that will undermine the reliability of our markets and harm tens of millions of retail investors," a Citadel Securities spokeswoman said in an email on Friday.

The lawsuit, first filed on Friday and first reported by the Wall Street Journal, exacerbates Citadel Securities' dispute over IEX's "D-Limit" order type. The D-Limit is intended to give traders the opportunity to buy or sell stocks on the stock exchange while protecting them from unfavorable price movements.

Citadel Securities had previously asked the SEC to reject IEX's proposal. The D-Limit will damage the integrity of the US stock market. In August, however, the SEC sided with IEX to move the plan forward.

Citadel Securities asked the U.S. District of Columbia Circuit Circuit Court of Appeals to review the SEC's decision to approve the D-Limit resolution, according to a copy of the court file.

The SEC was not immediately available for comment late Friday.

IEX President Ronan Ryan said in a statement quoted by the Wall Street Journal that he was confident the SEC's decision would be confirmed. "Since its inception on October 1, D-Limit has proven valuable to a wide range of market participants," said Ryan.

"In our view, this latest move should only encourage more investors, brokers and market makers to use D-Limit as the protections we have put in place clearly work," said Ryan.

Disclaimer: Fusion Media would like to remind you that the information contained on this website is not necessarily real-time or accurate. All CFDs (stocks, indices, futures) and Forex prices are not provided by exchanges, but by market makers. As a result, prices may not be accurate and may differ from the actual market price. This means that the prices are indicative and not suitable for trading purposes. Therefore, Fusion Media is not responsible for any trading loss you may incur as a result of using this information.

Fusion Media or anyone involved with Fusion Media assumes no liability for any loss or damage caused by reliance on the information contained on this website, such as data, offers, charts and buy / sell signals. Please be fully informed about the risks and costs associated with trading in the financial markets. This is one of the riskiest forms of investment possible.

Related Articles