"broker preferencing" (which is really queue jumping) looks really bad to me. As if we didn't have enough to deal with, with internalization, PFOF deals with wholesalers, fragmentation, and byzantine order types. This will add yet another way for brokers to skim their clients -- something US investors do not need. And it will be hard to get rid of if it's approved, even if it makes markets messier (and no doubt on my part that it will).
The market doesn't need or care about the home trader and don't need your liquidity. the bread and butter of the exchange is the HFT machines and institutional orders who buy the ask price or sell the bid. you cutting throats over 1 penny or sub penny..you don't matter to the exchange.. you can leave. if you don't like the game
you bids won't get filled and you won't sell the ask in this market so get over it. take the ask. is the reality.
my guess is the reason IEX wants to do this is to get more orders into their book for possible revenue & to increase their activity that needs to be done before their hopes of becoming an exchange can become a reality. Also, if they were such a hero to retail, they would not charge to pass orders to other venues for execution. Why charge for not being able to fill an order? IEX seems to be a little used, internalizer foodfest & mandatory skimming toll road to executions on NSDQ, ARCA, and the other big exchanges.
"The game" of trading more effectively is fine by me, but I don't much like the practice of manipulating the rules of "the game" in order to gain market share at the expense of fairness and transparency, in this case enabling B/D's to skim more off of their clients in the process. And that's exactly what "broker preferencing"/queue jumping does. IEX painted themselves as "white knights" of the market and -- incredibly -- got the most famous author in finance to write a book promoting them. Then they try to become an exchange that explicitly allows queue jumping, opening the door for every other exchange to have queue jumping as well. I hope that the SEC has the wisdom to deny their request.