Commission Looks at Changes in How Stocks and Futures Are Regulated
The presidential commission studying the stock market collapse is considering changes in the way stock and futures markets are regulated as well as in the New York Stock Exchange's specialist trading system.</br></br>The regulatory changes under consideration are intended to overcome conflicts between the Securities and Exchange Commission, which oversees stock trading, and the Commodity Futures Trading Commission, which supervises futures trading, including trading in stock index futures contracts.</br></br>Stock index futures contracts give investors the opportunity to bet on the future movement of stock prices by purchasing contracts that represent broad stock market averages, such as the Standard & Poor's 500.</br></br>Meanwhile, New York Stock Exchange officials yesterday criticized a proposal by the presidential commission headed by investment banker Nicholas F. Brady to put daily limits on the amount that stock prices can move. The limits would be designed to diminish stock price volatility, which hit its peak in the 508-point drop in the Dow Jones industrial average on Oct. 19.</br></br>Brady emphasized yesterday that the stock price limit proposal is only one of many options the panel is considering.