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Market Structure

Strong regulatory frameworks are essential for fostering competitive, transparent, and efficient markets. MFA members are sophisticated alternative asset managers who depend on robust capital markets to generate returns for their investors, including pensions, foundations, and endowments. As markets continue to evolve through technological and product innovations, MFA advocates for financial regulations that ensure reliable and stable marketplaces that serve the needs of investors, businesses, and the economy.

Equity market structure

MFA advocates for effective equity market structures that promote transparency, encourage liquidity, and maintain orderly trading during market volatility. Effective frameworks include rules for market-wide circuit breakers, individual stock trading pauses (limit up-limit down), and Reg SHO to strengthen short-sale trading. Ensuring global regulatory frameworks evolve with new trading practices and technology will reinforce market transparency, liquidity, and efficiency.

Security-based swaps (SBS) market structure

MFA advocates for a robust market structure for SBS. While recognizing the need for certain bespoke SBS contracts to meet investor needs, MFA endorses a regulatory framework that fosters the development of stable, efficient, and liquid markets. MFA encourages regulators to adopt a flexible regime that accommodates market participants while ensuring necessary regulatory protections and market integrity. 

Fixed-income structure 

MFA recognizes the significance of a robust and efficient fixed income market structure. This market serves as a crucial funding source for corporations, municipalities, and governments, playing a pivotal role in the global economy. MFA advocates for a regulatory framework that promotes transparency and liquidity while accommodating the diverse range of fixed income products and participants. This includes fostering competition among trading venues, enhancing pre- and post-trade transparency, and encouraging the use of electronic trading platforms for improved execution quality and reduced costs. As the fixed income market evolves, MFA supports regulatory efforts that address emerging risks and maintain market stability.

Securitization market structure 

Well-functioning securitization markets are essential for economic growth, diversified funding, and financial stability. MFA supports a regulatory environment that encourages competitive, transparent, and efficient securitization markets. This includes promoting standardization, enhancing disclosure requirements, and implementing appropriate risk retention rules to align issuer and investor interests. MFA also encourages regulators to facilitate global coordination in securitization regulation to reduce fragmentation and promote more harmonized markets. As securitization markets continue to innovate and develop new products, MFA is committed to working with regulators to ensure robust and resilient markets that serve the needs of all stakeholders.

U.S. Treasury market structure

The U.S. Treasury markets are the largest and most liquid government bond markets in the world. Treasuries are both the primary debt instrument for the U.S. government and a foundation of the global financial system. The Treasury markets’ liquidity and depth limit volatility and provide stability. The markets are comprised of a large and diverse pool of market participants who buy, sell, and hold the bonds. The resilience of these markets is critical to financial stability and economic prosperity. The diversity of participants in the market is what fuels its resilience.

To enhance the resiliency and efficiency of the Treasury markets, it is critical that policymakers do not radically change the market structure before understanding the consequences of significant modifications. Treasury market structure is enhanced with thoughtful and gradual modifications that minimize any negative, unintended impacts to liquidity and efficiency, while maximizing participation and resilience.



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