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Non-Tech : Knight/Trimark Group, Inc. -- Ignore unavailable to you. Want to Upgrade?

To: Gary Korn who wrote (3878)	9/11/1999 10:25:00 AM
From: gbh	Read Replies (2) \| Respond to of 10027

It almost seems one needs Level 2 (I used to have it) for any trade with an ECN. Can't imagine Ma and Pa on-line trader going for such a thing. Gary, but no one "just" trades through ECNs, even day-traders. Even day-traders will utilize Selectnet when no ECN is available for a match. And Selectnet basically implies a MM on the other side. No OLB I know of solely uses an ECN, and there is no way they could, due to lack of liquidity, even in the DELL/INTC/MSFT type stocks. It wouldn't be unusual for even DELL not to show up on ISLD at the bid/ask for a minute or two, or maybe more, many times throughout the day. I think one of the reasons that OLBs will move toward the Datek model of using ECNs for limit orders, is that the MMs (like NITE) do not pay for limit order flow outside the current bid/ask. Therefore, if the OLBs can execute these trades at fractions of a penny per share, they will pocket more of that already low commission. This is a risk to NITE, and is why they may at some point have to outright buy an ECN. Remember, ECNs make just a fraction of what NITE makes on a trades, but with zero risk. The problem is, outside of INCA, ISLD, and maybe ARCH, the rest of the ECNs have little hope of surviving on their own. What's your take on this issue? Gary