SEC’s Hired Gun on High-Frequency Trading Gets Permanent Role
The U.S. Securities and Exchange Commission has promoted its computer-trading specialist, boosting his office’s effort to scrutinize rapid-fire trading’s impact on equity markets.
Gregg E. Berman, who holds a doctorate in physics from Princeton University, was named today as associate director of the SEC’s new office of analytics and research. Berman had been working at the agency on a temporary appointment to improve the SEC’s monitoring of electronic trading, and his contract would have expired in October.
“Though the markets may be complex, they are not impenetrable, and I am confident in our abilities to continue developing data-driven analyses to inform policy,” Berman said in a statement.
Under Berman, the SEC has started using a system, dubbed Midas, to collect trading data generated by exchange companies such as NYSE Euronext and CBOE Holdings Inc. (CBOE) The system gives the SEC access to the same data acquired by banks and high-frequency traders.
Berman, 46, also played a key role in writing a rule, known as the consolidated audit trail, which requires exchanges to track all orders and trades.
Such tools are intended to give the SEC quicker insight into market disruptions caused by complex, computerized trading systems. The SEC’s report on the 2010 stock market disruption, commonly called the “flash crash,” took five months because the agency lacked access to the necessary data.
Employing fewer than 10 people, Berman’s office is still trying to lure Wall Street analysts and specialists. Those who have been hired were offered two-year stints, due to restraints on the SEC’s ability to hire permanent, non-attorney employees.
Berman said the temporary positions haven’t been an obstacle to attracting analysts, who are allowed to work in the SEC’s New York regional office.
“Coming into the SEC is a big commitment for many people, especially if they are from The Street,” Berman said in a phone interview. “They have experiences, families, and there seems to be an appeal to saying you are not signing up forever.”
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