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Non-Tech : Ashton Technology (ASTN) -- Ignore unavailable to you. Want to Upgrade?

To: mst2000 who wrote (3756)	4/10/2001 4:54:23 PM
From: LPS5	Read Replies (1) \| Respond to of 4443

if POSIT and Instinet trades are separately identified within the consolidated tape I've never seen them identified in any special way. an ATS under the auspices of a B/D, rather than as an exchange facility. I assume it has some bearing on how much flexibility they have in handling credit authorization and clearing issues The overwhelming majority of ATS' are B/Ds. All of the ECNs, POSIT, AZX, etc., are or started as broker-dealers. Some are self-clearing, others clear on a correspondent basis. ATS' operating as facilities of exchanges are the exception to the rule. Off the top of my head, I can only remember that OptiMark operated as a facility of the PCX and that Primex, when introduced, will operate as a facility of the NASDAQ, which by then will be registered as a full-fledged stock exchange. With regard to credit authorization, such is a negotiated point between the introducing firm and the clearing entity, or where applies between the self-clearing firm and the subscriber/client. I would add that Bear Stearns is among the largest three clearing firms on the street - and perhaps the largest - so credit is most likely not an issue of any difficulty or contention. I don't know of many buyside desks that clear their own trades. Rather, transactions for them are executed on a DVP/RVP (delivery vs. payment/receive vs. payment) basis, such that they trade via a sellside desk, the trading desk acronym ("MPID") is associated with the trade, clears it, and via the magic of back office systems, the trade settles in the buyside institution's custodial or prime brokerage account. And, with regard to anonymity and credit authorization, I think the primary secrecy concern is other buysiders - not the clearing firm. Even so, DVP and QSR (qualified subscriber relationships) clearing arrangements for institutions are typically handled with a large degree of anonymity anyway, involving mostly codes and routing/bank ID numbers. And, logically, if the firm states that it has 70 of the top buyside entities on board, it will take only a few flips through Nelson's Directory of Investment Managers to figure out who's on board. Lastly, it would be interesting to see what kind of volumes they get out of the box. This will be the key to their success. Having lined up both institutions and the primary buyside platforms (OMS) through which they operate, we should know shortly. as a privately held company, there is not a lot of information about what they are doing out there. That's true, but as a broker dealer - and, more specifically as an ATS - there are required disclosures that they must make and which are available to the interested, investigative party. B/Ds have to file FOCUS reports reflecting upon their net capital position, which includes revenue, debt to equity, and aggregate indebtedness figures; and, as an ATS, it is explicitly required that volume figures be filed quarterly (maybe monthly, I can remember exactly) with the SEC. LPS5