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

To: TFF who wrote (5360)	9/30/1998 8:30:00 AM
From: agent99	Read Replies (1) \| Respond to of 12617

Block Trading Sets Temporary Halt To Its Operations Amid Cash Crunch By REBECCA BUCKMAN Staff Reporter of THE WALL STREET JOURNAL September 30, 1998 Block Trading Inc., one of the largest brokerage firms to offer "day trading" services to individual investors, said it has temporarily closed up shop. Chris Block, the company's chairman and chief executive officer, said that the Houston-based firm -- which as of Monday had 13 branch offices in several states -- is out of money and has stopped processing orders as a broker-dealer. Although he hopes to recapitalize his company, Mr. Block said getting the firm up and running again could take one to six months, "depending on if we can stay out of bankruptcy." He's now shedding his operations, which are going to other firms. Block Trading became one of the best-known brokerages to offer day trading, in which individual investors are allowed to use a brokerage firm's sophisticated computer systems to make trades like professionals. Typically, such investors move rapidly in and out of securities, hoping to profit from small price movements and rarely holding positions overnight. The brokerage firms make money primarily from commissions on the trades. Mr. Block said that a year ago, his company had 24 branch offices and culled commissions from about 500 traders. The closely held company lately wasn't turning a profit mainly because it has lost about 10 branch offices to competitors in the past year and because it invested heavily in a computer-software venture, he said. However, competitors say Block Trading, formed in 1994, didn't upgrade its technology fast enough to meet customers' needs and may have expanded too quickly. Mr. Block acknowledged that his firm was hurt because it couldn't provide its customers access to Instinet, an off-exchange trading system run by Reuters Holdings PLC that is used by some competitors. An Instinet spokesman couldn't comment specifically on Block Trading but noted that Instinet offers different levels of service based on a customer's credit and other criteria.