PTG Responds to CT Revenue Allocation Methodology Proposal
Jul 8, 2026
In a letter filed today with the Securities and Exchange Commission (SEC), PTG supports the CT Plan Third Amendment’s 5:1 cap on quote-related versus trade-related revenue allocations as a corrective step but argues it is too narrow to fix the deeper structural problems in the SIP revenue allocation formula. The letter contends that the current formula over-rewards quoting activity relative to executed trades, creating incentives for exchange proliferation and revenue extraction rather than genuine contributions to liquidity, price discovery, or market quality.
PTG recommends broader reforms: reducing CT Plan costs so the plans operate more like public utilities than profit centers; shifting substantially more revenue allocation weight toward executed trades; limiting any quote credits to NBBO-setting quotes that result in executions; and establishing a minimum participation threshold, such as 2% market share, before exchanges can share in SIP revenues. The letter concludes that the SEC should use this proposal along with its broader reconsideration of Regulation NMS, to realign market data revenue incentives with actual contributions to the national market system.