1. Should all information be made public? For example, how can information known only to insiders, such as corporate executives, be used? Exchanges do not permit insider trading, because it is illegal.
2. If all information is not made public, then should at least the trading record be public information? For example, should you be able to know who is doing the trading? On the NYSE, investors may trade without revealing who they are. Thus, the NYSE has decided that it is in the best interest of investors to be able to trade in secret. Although corporate executives must report their trading activities to the appropriate regulatory agencies, they do not have to reveal their trading activities until after the trade has been executed.
3. Are traders able to buy and sell without greatly influencing market prices? For example, the NYSE has an appointed person whose job description requires that “on those occasional instances when there is temporary shortage of either buyers or sellers, [he or she] will buy or sell for their own accounts, against the trend of the market.
4. Are prices allowed to gyrate wildly, or are there constraints on how much prices can move? Are there daily price limits? The NYSE has adopted a circuit breaker system in response to the stock market crash of 1987. By Rule 80B, when the Dow Jones Industrial Average (DJIA) falls by 350 points from the previous day’s close, trading is stopped for ½ hour. If the DJIA continues to fall to 550 points below the previous day’s close, trading is stopped for 1 hour. The idea is that these trading halts will give potential buyers an opportunity to assess the market and be willing to place orders to buy.
5. Will the market attract a large number of traders who will provide the necessary liquidity?
6. Will this market require an individual to specialize in providing liquidity for a particular security? For example, the NYSE has such a person, whereas the OTC market does not.
   

Several of these issues are conflicting. For example, how can there be an informationally efficient market (Question 1) and, at the same time, a market that disallows large price swings (Question 4)? This is impossible, because information can arrives in a dramatic fashion. Consider the possible effect on a market of the news of an earthquake, major accident, or political event.