Derivatives industry seeks clarity over SEC market-wide circuit-breaker proposals
In an attempt to prevent a repeat of last year's ‘Flash Crash', the US Securities and Exchange Commission announced, on September 27, 2011, a review of proposals to revamp market-wide circuit breakers. Public comment is open until October 25 for new rules that could have unexpected ramifications for the sale of structured products
If new circuit-breaker proposals filed by US national securities exchanges and the Financial Industry Regulatory Authority (Finra) are approved by the US Securities and Exchange Commission (SEC), they will replace those adopted in October 1988.
Market-wide circuit breakers, when triggered, halt trades across all exchange-listed securities in the US markets. So far, these mechanisms have only been triggered once, back in 1997.
"If circuit breakers are triggered for exchange-traded securities
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