The U.S. Securities and Exchange Commission has proposed a couple of rules designed to improve investor protection through greater market oversight of large traders, and better execution in the options markets.

On Wednesday, the SEC voted to propose the creation of a large trader reporting system that would enhance its ability to identify large market participants, collect information on their trades, and analyze their trading activity.

It proposes that large traders (defined as a firm or individual whose transactions in exchange-listed securities exceed two million shares or $20 million a day, or 20 million shares or $200 million during any month) be required to identify themselves to the commission, and to their broker-dealers, who would be required to maintain transaction records for each large trader and report that information to the SEC upon request.

“This rule is designed to strengthen our oversight of the markets and protect investors in the process,” said SEC chairman Mary Schapiro. “It would give us prompt access to trading information from large traders so we can better analyze the data and investigate potentially illegal trading activity.”

Additionally, the SEC proposed to put in place two investor protection measures in options markets that currently exist in stock markets. It would prohibit an options exchange from unfairly impeding access to displayed quotations, and would limit the fees that an options exchange can charge investors and others wishing to access a quote on an exchange.

“This rule is designed to increase transparency in the markets and promote greater fairness and efficiency,” said Schapiro. “It is important that investors have the ability to access the best prices available regardless of the exchange that is posting the quotation. And, those investors should have a better understanding of the true cost of executing a transaction.”

IE