CFTC regulator says open to narrowing automatic trading rule

Massad said he stands behind the idea of adding regulations on automated trading but that some industry concerns about the scope were valid.

Specifically, Massad said he could endorse limiting the oversight to two levels, not three as originally proposed.

"I would support requiring risk controls at the exchange level, and either the trader or FCM level," he told a conference in New York sponsored by the New York Federal Reserve.

"A trading firm could have its own controls or opt in to the FCM controls," he said.

(Reporting By Patrick Rucker; Editing by Chizu Nomiyama)