Exchanges, Regulators Scramble to Fix ETFs After August Rout
- BATS's Concannon says U.S. markets can't handle growth of ETFs
- NYSE hires a consultant to examine trading of products
ETF's Safety Probed Following August Market Rout
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U.S. stock exchanges and regulators are scrambling to make exchange-traded funds less susceptible to disruptions after last month’s volatility triggered wild price swings for hundreds of the investment products.
The chief executive officer of Bats Global Markets Inc. said Thursday that rules governing U.S. markets need to be updated because they aren’t designed to cope with the proliferation of ETFs, instruments that typically track a broad investment portfolio but are bought and sold like individual stocks. An official at the New York Stock Exchange added that it has hired a consultant to review how ETFs trade on the company’s markets.