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.

Strategies & Market Trends : The Final Frontier - Online Remote Trading -- Ignore unavailable to you. Want to Upgrade?

To: TFF who wrote (7851)	1/7/2000 3:58:00 PM
From: LPS5	Read Replies (2) \| Respond to of 12617

I'm glad I hedged my bet with the "unlikely, but I don't know for sure": Reuters' Instinet to Start Retail Internet Brokerage in April New York, Jan. 7 (Bloomberg) -- Reuters Group Plc's Instinet Corp., the electronic trading network most widely used by institutional investors, plans to open an Internet brokerage aimed at consumers, according to a Bear Stearns & Co. analyst. New York-based Instinet would let retail clients place orders alongside institutions. The service, set to start in April, would offer access to charts, news and research, said Amy Butte, the analyst. Instinet will spend about $100 million on advertising to build the brokerage, she said, about the same as the No. 3 company, TD Waterhouse Group Inc. Reuters officials couldn't immediately reached for comment. Butte said her information came from a ``private meeting' this week with Instinet president Doug Atkin. The move by Instinet could signal consolidation in the industry, as competition for customers erodes profits for brokers such as Ameritrade Holding Corp. and ETrade Group Inc., which generate more than two-thirds of revenue from commissions, she said. An Instinet brokerage could also cut into the business of the biggest Nasdaq market maker, Knight/Trimark Group Inc., which gets half its trades from Internet brokers. Growth Internet brokerage trades have doubled in the past year to more than 700,000 transactions daily, accounting for at least one in six U.S. stock trades. Hungry for such growth, Web brokerages are spending $1.2 billion a year on ads to land new clients. Instinet, started in 1969, is the oldest and biggest of nine electronic communications networks. Most ECNs were started in the past two years. Combined, they now execute almost one-third of Nasdaq stock trades. Internet brokerages like ETrade and Charles Schwab Corp. have acquired stakes in ECNs in an effort to provide destinations for client orders other than market-maker desks. The No. 2 ECN, Island ECN Inc., is owned by the fifth-biggest Internet brokerage, Datek Online Holdings Corp. Schwab, the biggest Internet brokerage, can withstand a threat from Instinet because it is big enough and has a broad enough set of products, Butte said. Instinet is expected to set its commission somewhere between Datek's $10 and Schwab's $29.95, she said. -------------------------------------------------------------------------------- ¸ Copyright 2000, Bloomberg L.P. All Rights Reserved.