Analysts Welcome Foreign Access Rules

07-04-2008 | Source: Wall Street Letter - Click here to take out a FREE Trial

Analysts applauded last week's Securities and Exchange Commission changes to foreign market access rules. The proposal to let more U.S. investors access foreign brokerages has taken up to eight years to come
into effect, but because of the regulator's push to get the change done quickly, analysts estimate the change to take four to five months. The ruling is now subject to public comment.

Ultimately, the changes will create more direct market access in both American and overseas markets. "We contend that we have a free flow of goods and services which often have a lot of barriers," Aite Group
analyst Denise Valentine said. Regulatory bodies are starting to realize that major change is needed to create global direct market access, she added

Celent analyst David Easthope noted tat there are still significant hurdles to free access, including clearing relationships with the exchanges, building connectivity and understanding order book rules, among others. He said that the SEC has done all that it can to create more global market flow via this ruling. "Investors should have access to all products and services globally," SIFMA spokesman Travis Larson explained, adding that this rule change, which his organization worked on with the SEC, will allow greater flow
of research between brokerages in different countries