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Strategies & Market Trends : DAYTRADING Fundamentals -- Ignore unavailable to you. Want to Upgrade?

To: Richard Estes who wrote (2662)	8/12/1999 1:17:00 AM
From: N2GROWTH	Read Replies (1) \| Respond to of 18137

Spear Leeds & Kellogg Stops Margin Over 2 to 1.... I am the founder and President of a Direct Execution Firm in Irvine, CA. I received many calls and held a personal meeting with 3 traders from a Cornerstone Securities office today. Cornerstone Securities uses SLK for a Clearing Firm. for those of you who don't know, SLK is the largest Clearing Firm in the Day Trading industry. Today, 5 minutes after the close, the traders were all informed that they would no longer be able to borrow from the firms capital of from other traders to exceed the 2:1 margin requirement. They all wanted to come to my form to trade. I informed them that we always have and will continue to abide by the Fed Req.'s for intraday margin. They were very disappointed and they fee that they will only be able to trade 20% of the number of shares they use to trade. They were speculating that this will cause liquidity to dry up. I indicated that I didn't think that SLK would make this decision and give up the additional volume without having done a great deal of legal due diligence. Could it be that some legal insiders informed SLK that a new rule prohibiting this is in the offing?? I also told them that of the firms I know of that were offering this additional intraday leverage, that only a small percentage of the traders were permitted to take advantage of this. If there was going to be trouble for doing this, I expect a clearing firm will do what ever is necessary to keep out of the regulators crosshairs and protect the other 90 to 95% of their business... Just FYI N2growth