I see we picked up some more approvals! I was a little unclear on a couple of aspects of this and was hoping you might share some of your thoughts. In part, the release provides,
"The Ashton Technology Group, Inc.(NASDAQ: ASTN chart, msgs) announced today that Ashton's affiliate agency broker, Croix
Securities, Inc., has been granted its application to operate CroixNet(TM), an alternative trading
system (ATS), by NASD Regulation, Inc. (NASDR).
Croix had filed ATS applications with the NASDR and the Securities and Exchange Commission (SEC) in April of this year. The SEC application was a notice filing under Regulation ATS under the Securities Exchange Act of 1934, but the NASDR application required express approval by the
NASDR. CroixNet is an anonymous intelligent matching system that will execute trades in all listed and NASDAQ issues at eCLOSE(TM) Prices, based on primary exchange market and NASDAQ closing prices. The System will operate as an ATS platform of Croix.
1. Are Croixnet and eClose essentially one and the same? I didn't think so and I had been thinking eClose would also have to have its independent approval? Or is Croixnet a platform that other intelligent matching systems can now be launched from under the 20-day filing process, and eClose just happens to be the first of the 2nd generation matching systems?
2. The scope of the approval indicates "all NASDAQ and Listed securities." This is considerably broader than on regular eVWAP, which is limited to the most liquid stocks. I wonder if that restriction may drop off when permanent approval is obtained on eVWAP.
3. Given that the scope of eClose is all securities, I would have to think the inroads ATG has made to put structural liquidity into eVWAP will spillover into eClose. While eVWAP seems to have price efficiencies over regular time-slicing methods to obtain a vwap price, a concern I had was that it could not guarantee an execution. ATG has since addressed this potential barrier to participation by introducing the guarantee fill program, which the latest SEC filing indicates a liquidity pool of 100 million shares. I have to believe the plan is to offer market participants 3 separate points and prices to enter or exit positions anonymously. What I'll be looking for is the extension of the guarantee program to all three points.
4. Since this is run through Croix Securities, Inc, shouldn't the commissions, whatever they turn out to be, go more directly to Ashton's bottonline? Assuming the liquidity providers step-in and support this program like they do eVWAP, then of course there will be revenue sharing, but where natural liquidity happens, we may see 2-4 cents an eClose share.
5. It will be interesting to see when the pricing comes out whether these trading systems (eClose, 9:15 eVWAP, and 10:30 evwap)stand alone or are connected. I mean eVWAP currently has discounts for volume, so I wonder if the the use of another ashton trading systems will count toward earning a discount on any system. I view these systems as interconnected, kinda like a full service benchmark filling station where those who seek an anonymous benchmark execution may come and specify their flavor.
6 I wondering if anybody is studying closely the relationships between the 9:15 eVWAP price, the 10:30 eVWAP price, and the eClose price. Any interest in benchmark trading?
I think this is a pretty exciting development.
PS
GO FREDDY! |
