Xavier Rolet, chief executive of the London Stock Exchange Group, entered into a Twitter debate on exchange rebates following news that Massachusetts is reviewing whether they are in the best interest of investors.
Last week Massachusetts' securities regulator announced an inquiry into whether retail brokerages are routing orders to stock exchanges in return for payments instead of best execution. William Galvin, the secretary of the Commonwealth of Massachusetts, said in a statement: "If financial rebates or kickbacks create a conflict that results in less than the best deal for the investors, this practice must stop."
Rolet responded to the announcement of the probe:
https://twitter.com/xrolet/status/898502007257837568
A "maker-taker" model involves an exchange charging clients who take liquidity, but offers payments - or rebates - to brokers who make prices and facilitate liquidity. He clarified that Turquoise, the multi-lateral trading facility owned by the London Stock Exchange, uses a maker-taker model as it is not a regulated exchange.
Jim Greco, founder of alternative trading system Direct Match, replied and exchanged a series of tweets with Rolet:
https://twitter.com/jgreco/status/898508609113518080
https://twitter.com/xrolet/status/899290086738608128
https://twitter.com/jgreco/status/899292817566175233
https://twitter.com/xrolet/status/899297849132765184
https://twitter.com/jgreco/status/899310944916049920
https://twitter.com/xrolet/status/899343015310893056
https://twitter.com/jgreco/status/899344193507774465
https://twitter.com/xrolet/status/899344139682070528
https://twitter.com/xrolet/status/899344864763981824
https://twitter.com/jgreco/status/899345239202304002
https://twitter.com/xrolet/status/899345859879387136
https://twitter.com/jgreco/status/899346724686376960
https://twitter.com/jgreco/status/899346982824706048
https://twitter.com/jgreco/status/899347163100086274
https://twitter.com/xrolet/status/899350503372464128
https://twitter.com/xrolet/status/899347961204715520
The debate ended cordially:
https://twitter.com/jgreco/status/899347591661572097
https://twitter.com/xrolet/status/899348845431201792
