Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Microcap & Penny Stocks : TSIG.com TIGI (formerly TSIG) -- Ignore unavailable to you. Want to Upgrade?

To: Suzanne Newsome who wrote (32884)	7/22/1999 9:53:00 PM
From: Zbyte	Read Replies (1) \| Respond to of 44908

Bye Bye Market Maker, they are history... Another Threat to Nasdaq Four Firms Launch Electronic Stock Trading System By Noelle Knox The Associated Press N E W Y O R K, July 22 — In another challenge to the Nasdaq Stock Market, four major financial firms have announced plans to launch an electronic stock trading system, which would give them a share of the booming online and after-hours stock trading business. Fidelity Investments; Charles Schwab; Donaldson, Lufkin & Jenrette; and Spear, Leeds & Kellogg plan to pool their technology to create an electronic system to match buyers and sellers. “For any (electronic trading system) to really work, critical mass is extremely important,” said Bob Mazzarella, president of Fidelity Brokerage Services. “If you look at the players involved, we put together quite a robust group to provide that liquidity.” The new company, which has yet to be named, is expected to be up and running by the end of the year. Retail and institutional clients may be able to buy and sell stocks and options after traditional markets have closed. Nine Firms and Counting “This certainly gives us a platform to deal with after-hours trading,” said Mazzarella, adding that no decision has been made. Nasdaq and the New York Stock Exchange, as well as other traditional exchanges, are under pressure to extend their trading day to allow investors in different time zones more access to the markets. Technology that has allowed millions of people to trade online has spawned the creation of trading networks that link buyers and sellers, bypassing the traditional exchanges. Nine separate electronic trading firms have sprung up in the past few years, the largest being Instinet. Wall Street's top-name companies are all getting into the game. Goldman Sachs, J.P. Morgan, and Etrade, for example, own stakes in a trading network called Archipelago. These trading systems, known as electronic communication networks, or ECNs, have already stolen away between 20 percent and 25 percent of the trading volume from Nasdaq, Mazzarella said. About 1 billion shares are traded daily on Nasdaq. A spokesman for Nasdaq declined to comment. Aiming for Year's End The joint venture will use the existing electronic trading system of Spear, Leeds & Kellogg, which is the nation's largest specialist and market-making firm in stocks and options. The trading system currently trades 20 million shares a day. Trading volume on that exchange, however, should skyrocket with the addition of business from Charles Schwab, the San Francisco-based brokerage firm; DLJdirect, the online trading arm of Donaldson, Lufkin & Jenrette; and Fidelity's Capital Markets division. Each company will own 25 percent of the new venture. “We wouldn't be in this if we didn't believe we could have an impact on the business that will be going through this new ECN,” Mazzarella said. Mazzarella said he expects to get regulatory approval and be up and running by the end of the year. The firms focus on trading limit orders of Nasdaq listed stocks. A limit order is an order to buy or sell a security at a specific price, and protect customers from getting a bad deal.