U.S.

Equity Market
Structure Flashback
Survey
March 2015

Letter from Eric Noll

One year ago, U.S. equity market structure was the hot topic of conversation, even beyond the
financial industry.
Michael Lewiss book Flash Boys offered high frequency trading and HFT as watchwords for
everything people felt might be wrong with Wall Street, and investors themselves seemed to
agree. In April of 2014, just weeks after the books release, our U.S. Equity Market Structure
Survey found seventy percent (70%) of financial industry participants saying the markets were
not fair to all investors.
The debate continues today. And while Mr. Lewis cited our 2014 survey in his new Vanity Fair
retrospective on Flash Boys, investors perceptions have clearly changed in the intervening
eleven months. While our industry continues to grapple with a complex and challenging market
structure, volatility has remained at historically low levels, the S&P 500 is up 12% since this time
last year and weve seen the largest IPO ever go off without a hitch. And as the results of our
new U.S. Equity Market Structure Flashback Survey show, fewer people now believe that
the house is on fire.
While a majority of respondents (57%) say that markets are not fair for all participants, fewer than half of those surveyed (42%)
report having changed how they interact with markets because of the ongoing HFT debate, indicating that financial industry
participants are still unsure of what changes they may need to make in how they trade.
As an agency-focused global broker, we are in a unique position to guide our clients (over 3,000 institutional investors and financial
intermediaries) through these issues which include high frequency trading, regulatory oversight and market stability. At Convergex
we have always taken a proactive approach to providing our clients with the knowledge and tools they need to successfully
navigate evolving markets and achieve their trading objectives.
Away from the hype and the headlines, we hope that the results of this survey help you understand how the industry currently
views the market structure debate, and that together we can find the right solutions for you.
Eric Noll
President & CEO

Please identify the type of company you work for:

58%

Are the U.S. equity markets fair for all participants?

(18%)

(April 2014 Survey Results)

(70%)

(11%)

Overall, is high frequency trading (HFT) helpful or harmful to

participants in the U.S. equity markets?

(4%)

(April 2014 Survey Results)

(15%)

(30%)

(38%)

(13%)

Has the ongoing debate regarding HFT caused you to change the
way you interact with the U.S. equity markets?

(2%)

(April 2014 Survey Results)

(20%)

(71%)

(7%)

What changes have you made to the way you interact with U.S.
equity markets? (select all that apply)

Required more buyside transparency

Required more sellside transparency

Should there be more or less market structure regulation for the

U.S. equity markets?

(4%)

(April 2014 Survey Results)

(39%)

(38%)

(14%)

(5%)

How confident are you that the U.S. equity markets could handle
the volume created by a sudden geopolitical crisis or other large
volatility shock?

(8%)

(April 2014 Survey Results)

(30%)

(22%)

(33%)

(7%)

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Survey Methodology
The Convergex U.S. Equity Market Structure Flashback Survey was performed by Convergex via an anonymous online survey of financial industry participants, resulting in
245 respondents. The survey was conducted from March 17, 2015 to March 19, 2015, and has a margin of error of 10%. Respondents included buy-side firms (asset
managers, hedge funds), sell-side firms (banks, broker-dealers), trading venues, service providers and other financial industry participants. Rounding of decimal results may
produce totals over or under 100% (by 1%).
Convergex is an agency-focused global brokerage and trading related services provider that takes on the industrys toughest challenges, from complicated trades to complex
businesses. With clients interests as the top priority, Convergex delivers comprehensive solutions that span global high-touch and electronic trading, options technologies,
prime brokerage, clearing, commission management and beyond. Headquartered in New York with a presence in several other locations including Atlanta, Boston, Chicago,
Orlando, San Francisco and London, the company serves nearly 3,000 clients accessing over 100 global market centers. Convergex provides brokerage services primarily
on an agency basis, but may operate in a riskless principal and/or net trading capacity, and in connection with certain ETF or ADR transactions, may act as principal or
engage in hedging strategies with such transactions. Convergex does not engage in market making or investment banking activities, other than as a selling group member.
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