Bob, your numbers point out the the single glaring shortfall of the quarter. Revenue per trade. ML and others, for whatever reasons, saw NITE maintaining the $10/trade revenue number of 2Q. In times of lower volatility, it now seems apparent the $10 number is unrealistic. We now know that the long term realistic number is $8/trade, according to KP. My guess is that this number won't be consistent either, but rather, a cyclical thing, coincident with volatility, and to a lesser extent, volume.
Bob and Gary,
Good points. I also believe that a higher $revenue/trade number requires higher OTC volumes. Spreads make a difference, and low liquidity stocks have them. I keep recalling the cc, where they spoke of umpteen million trades being matched/handled for free. Hard to make money that way, unless having that volume allows you to play the trading game better.
Gary Korn |
