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Gold/Mining/Energy : Capital Alliance Group - CPT (CDNX)
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To: John Powell who wrote (326)4/20/2000 1:21:00 PM
From: Crazy Canuck  Read Replies (2) of 960
 
The other advantage using local brokers will have lies in avoiding the web of red tape that each country's security regulations involve, and beating competitors to the punch...its no wonder Merrill's plan is so slow-paced, in China alone, they just announced a three-month application procedure simply to be able to trade securities online: chinaonline.com;

Yup, you are dead on that these regulatory hassles, otherwise known as 'Barriers to Entry' await other Brokerage firms who want to establish a new presence in a variety of markets around the world.

SEG's model enables a faster execution of their expansion plans as they are not restricted by these regulations. Rather than poach transactions away from the existing firms on each exchange (like a new brokerage firm would do) SEG's plan provides their existing partner firms with a simple and effective way to increase the volume of transactions coming across their desks. These increased transactions would be like gravy to them.

Once again, because of this I can see how SEG's business plan would gain a lot of support by the existing 'well established' firms who stand to benefit from it. For the same reasons, I could also see where new firms trying to break in to the market may not receive as warm a welcome from the current members of that exchange.

Crazy Canuck
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