Excellent posts by MST2000:
bbb -- Did it just dawn on you and winsolwaz that ATG has a speculative dimension? I mean, seriously, do you think the longs here are that blind? Maybe you should wade through the 30,000 posts on this message board before you paint the longs as being under my hypnotic spell -- what a laugh! However, as a test, I invite another sheep call -- just say Baaaaaaaa if you are under my spell. LOL. Indeed, ROFLMAO.
But rather than leave it at that, let me address some of your (and winslowaz') statements. First, let me say that I have given this company and its business plan a heckuva lot more thought than you have (and have "surmised" how it will "fit in" to its place among "the players" in this business for a lot longer than you have). And clearly you have not. Knowing the names of a few companies in the business, and that they are more well known than little unknown ATG, does not equate to "due diligence"
Well, for one thing, your post reflects that you don't really understand how ATG fits - for example, the difference between an ATS and an ECN. Truthfully, I think its you who needs to get a "basic understanding of the players" -- that you lump ATG in the same boat as NITE, Herzog, Instinet, Island, etc. (by which I assume you mean to say, the ECN's) tells me that you don't undertand ATG and its competition. ECNs are vehicles for players who play the game the way it has been played to date (which is to say, an order flow system where buyers and sellers disclose their price and volume by placing orders on a limit or market-order basis) in the theory that by improving that game a little, they will take volume away from NASDAQ and NYSE. ECNs are bound by SEC rules which require them to execute direct matches at the best available market (which means that many of their matches cannot execute), and they move the vast majority of their orders over to NASDAQ and NYSE specialists when they don't match within the ECN within a certain time period. The ECNs are all vying for the same trades and traders. And when the NYSE and NASDAQ decide to make long term technological decisions, something they have been doing very slowly because they are the aircraft carriers of this industry, they will muscle the ECN's (or most of them anyway) right out of business.
ATG is offering a system that does a complete end run around the existing order - it is completely anonymous and based on derivative pricing - there is no disclosure of price and volume to the market as a whole until after the trade is executed and the trading session is over, and the derivative price (VWAP, and soon "Market on Close") is a widely accepted and unassailable standard. Yes, ATG's VTS system (its premiere trading system, but by no means its only system) involves matching buyers and sellers (but not at a limit order or market order price, like the ECN's -- at a derivative price, the VWAP). And I concede readily that, if they cannot attract buyers and sellers to participate in the system, it will not be a success.
On the other hand, the 20 stocks now being traded during this testing phase (there will be 300 NYSE stocks, and 100 NASDAQ stocks, when the system is running at full steam over the next 6 months) alone involve on average trading volumes in the vicinity of 100,000,000 shares a day (or a lot more on some days). All 300 top NYSE stocks and 100 top NASDAQ stocks probably account for 300-500 million shares a day. ATG is betting that they will capture some of the 8% of those trades that are executed on a synthetic VWAP basis today -- that could be 30 or 40 Million shares a day, of which they hope to capture a reasonable percentage. That does not include market-on-close, VWAP in Canada, VWAP in China, etc. Or for that matter eOX, eAS, ePLOB, eMC, etc. [Sidebar: I don't have the energy to talk about the potential of each of those now, but you may want to "surmise" how each of those systems and trading products will "fit in" before you let your altruistic concern for our collective well being get too far ahead of itself.]
You . . . altruists . . . seem to think all of the longs are under some hypnotic spell which lulls them into thinking that ATG is some Goliath of the industry, that VTS will be outrading the NYSE and the NASDAQ in a few short months. That is not so - but we do think that the idea behind VTS is a very (very) good one, and we trust management when they say that there has been significant institutional interest (which, intuitively, makes all the sense in the world) and that the current volume predictions for VTS are very achievable (and then some). And we do not need 5% of the market to make it work (that would be 40,000,000 plus shares a day, which would make ATG a $40-60 stock all by itself).
It's a changing world, bbb - I'm sure the owners of the Pony Express had a big laugh about how Alex Bell was never going to get the $$$ to lay telephone wires all over the country 100 years ago and that nobody would be interested even if he did. If you think ATG's business paln is too speculative, then have fun shorting it, or stay away - I wholeheartedly agree that it is not an appropriate stock to margin at this point, and have said so ever since it became marginable (which has not been that long). As a development stage company, it is (and will continue to be) prone to volatile price movements based on little more than perception and misperception, and is especially susceptible to MM's taking advantage of stop losses and margin calls, etc., to pluck off cheap shares. But if you think that $7.81 per share is the best we have to hope for, well, you are in for a big shock very soon. It may have been a little ahead of itself at $13 (clearly so), but it is no Bulletin Board stock with a good story and nothing else. It may be speculative, but it is a very serious company, with $30 Million in cash and no debt, staffed with very talented and experienced people. While ATG may not have names like Merrill and Goldman attached to it (yet), do NOT make the mistake of underestimating them. Fred R. has forgotten more than you will ever know about this business, and I feel very comfortable with him, Weingard, Uchimoto and Bacci at the helm. This is a great team - I have formed my own opinion about them from personal observation, discussion and 3 years of constant thought, consideration, review, reconsideration, doubt, resolution and independent confirmation.
(continued) |
