The following are the highlights from a recent chat session with Philip R. Berber, chairman of CyBerCorp.com, and the CyBerCorp.com customers. These chat secessions occur every few months in CyBerCorp's chat room and are designed for the customer. It is posted for your general knowledge and enjoyment
It's not a revolution it's evolution
Philip R Berber, Founder and CEO, CyBerCorp Inc
Technology evolves - there is never a revolution; it's always an evolution.
First generation are those e-mail based brokers such as E-Trade, Schwab, etc. Many have left those brokers to use more advanced technology.
The second generation, which CyBerCorp started developing almost 4 years ago, is usually described as direct access. This allows your order to be forwarded directly and electronically via the electronic broker.
The third generation, such as CyBerX and CyBerTrader 2.0, offers some important advancements including intelligent order routing, which is found within the CyBerXchange Super ECN. This can be accessed by way of the CyBerX software (the front end is kept very simple and the back end very powerful and intelligent) and within CyBerTrader 2.0. We had to build a large, expert system that contains the knowledge of the order handling rules, the rules of compliance, etc. On top of that, we use a hunt-and-seek technology, which I first was exposed to in the mid 80's in the military and aerospace domain. In those days the enemy was an enemy craft, tanks, submarines, planes, etc. Today the enemy is the market maker and other traders.
There are probably 15,000 or so active professional traders online and within trading rooms who are also your daily foe. The key is to provide you with the tools to be able to spot opportunities and exploit them quickly.
The third generation also gives you direct electronic access to each of the ECNs. Currently at CyBercorp.com, we link directly to almost all the ECNs. You will see us connect to all of them over the next weeks and months. Instinet has been added most recently and we are working on getting the Instinet book displayed! In fact, seeing inside the ECNs books is another important element of third generation technology.
The CyBerX people maybe wondering or worried about not seeing inside the ECNs but should not. When your order is forwarded to CyBerXchange, it can see inside the book, and your order automatically benefits from that, without you actually seeing that book.
What you are going to start seeing next on your screens is beyond the current third generation. You are going to get and benefit from far more advanced signal generation technology. This will give you more control and power over the signals that you get for the stocks that you are following. You will be able to see these signals within new signal tickers, which will keep updating during the day. This display will also be available in a really unique and quite dramatic five-dimensional graphical display. You have to see it to believe it and it will take some time to get the most out of it. The help files are large and invaluable.
To help you in this regard we have created a new simulator. This one is for CyBerTrader 2.0, so you will be able to learn and test and try the new software, its functions and features any time of the day, any day of the week.
2.0 is also easier to use - much easier! It gives you much more power and control with the click of the mouse. In some ways, the complexity of our execution system within CyBerTrader had made it difficult and complex to use. No longer! 2.0 addresses the need for a simpler, quicker, easier way to enter your orders and in the way that you want to.
For the first time, CyBerTrader 2.0 will make the CyBerXchange Super ECN available to all CyBerCorp.com customers. To date, only the CyBerX users have been able to benefit from it.
As I look forward, I see a world beyond the US and beyond stocks. Options will be available very shortly within the CyBerTrader 2.0 product. We are doing the final tests to the Options execution technology, currently, and we are starting to look at which securities to create execution technology for next. Futures and Bonds are currently high on our list. Commodities and Currencies are also being considered.
At the same time, we are looking overseas. Many of the European exchanges and some of the Asian exchanges are already electronic. These exchanges are looking for a CyBerX, CyBerTrader type front-end. In the same way that we already have non-US traders trading US stocks today through CyBerCorp.com. I see the day when US traders will be able to trade - for example, German bonds or British stocks, and just as easily as you trade NASDAQ and NYSE today.
I spend much of my time these days with some of the largest ECNs, Brokerage houses on Wall Street and other on-line brokers who are interested in CyBerCorp and our vision and plans for the future. We are currently designing and discussing what we call the e-SOS. This stands for Electronic Securities Operating System. I say Operating System in the same way that DOS or Windows is an operating system. The e-SOS is being designed as an open architecture, an open system that will connect buyers and sellers on a 24-hour basis, globally across a broad range of securities. This will mean that a trader in Singapore will be able to have his/her order matched electronically with a London-based fund manager for a NASDAQ stock.
People ask me how long will it take to create all this. I say it's all going to be delivered and operational within the next 12 to 18 months. I can tell you that it's already underway and being developed. One of the most important aspects of this, which will affect each and every trader a lot sooner than you realize, is what will happen to the exchanges and ECNs.
In summary, in our opinion, exchanges will start to operate and function much more like ECNs and ECNs will be organized much more like exchanges. I expect that there will only be 3 or so ECNs. I also expect that there will be few or no market makers within NASDAQ and few or no specialists on the NYSE floor. In fact, the floor won't be there. In its place will be computers matching orders from buyers and sellers, globally, 24-hous a day. The important benefit to you, the trader, is that the middleman is going to be removed and the transactional costs are going to be significantly reduced. All of the ECNs and exchanges will operate within one "virtual exchange." Think of it as a
hopper containing the ECNs and exchanges - an electronic hopper with no middleman and no spreads in the middle, much like the ECNs operate today.
Remember that our intention at CyBerCorp is to create and deliver tools that are in the very best interest of all of our online traders, as well as those in trading rooms operated by 3rd party day trading broker dealers. Each day, over 2,000 traders on-line and in trading rooms use our software. Around 20,000,000 shares a day are executed through the CyBerCorp technology. And our growth and success is due to you, our customers. We really try to respond to your request to additional functions and features. We do everything within our power to keep the systems as stable and reliable as we know how. We don't always succeed; sometimes there are external factors. In every case, emotionally at least, we hold ourselves accountable, even when the breakdown is outside of our control. Let me thank you for your support and at times, patience and understanding as we continue to strive to create and deliver the leading electronic trading technology and brokerage services for active professional traders. |
