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.

Gold/Mining/Energy : Day trading in Canada -- Ignore unavailable to you. Want to Upgrade?

To: the Chief who wrote (873)	10/20/1998 11:22:00 PM
From: JAS	Respond to of 4467

Need some help getting the invoices ready? Let's see..86 X a $30.00 fee for advice. You could give up your day job! LOL Jim

To: the Chief who wrote (873)	10/20/1998 11:38:00 PM
From: keith massey	Read Replies (1) \| Respond to of 4467

Nice to have you back Chief - the thread has been slowing down lately. I guess nobody has anything interesting to say. How about this to get the blood flowing. This is taken from a Recent Maclean's Magazine Article With Asia in financial turmoil and North American stock markets falling sharply, it hasn't exactly been a lazy, hazy summer for most investors. Just over the horizon, however, an even bigger upheaval is looming for Canada's securities industry. Within the next few months, the Ontario Securities Commission and its counterparts in other provinces are expected to table a series of regulatory changes that will revolutionize stock trading in this country. The new rules will affect everyone who buys and sells shares, from individual investors to huge pension and mutual funds. Behind these changes is the imminent arrival in Canada of proprietary electronic trading systems, or PETS. Already well established in the United States, PETS are private, computer-based networks that automate all or part of the trading process. In so doing, they compete with conventional exchanges, particularly for the large block trades favored by institutional investors. For close to a decade, the Toronto Stock Exchange and its Montreal cousin have fought to keep PETS out of Canada, arguing that they would fragment the market and make it harder for investors to know whether the prices they are being quoted are fair. A related concern is the impact of fragmentation on liquidity -- how much buying and selling interest there is in a stock. If too much of the trading action takes place on private systems, retail investors could find it difficult to trade the shares they want, when they want. Despite the potential drawbacks, few people doubt that electronic trading systems are the way of the future. Around the world, traditional trading floors are shutting down and being replaced by computers and high-speed data networks. The TSE has been at the forefront of this trend. In April, 1997, the exchange closed its 146-year-old trading floor and switched to a fully computerized system, a move that is expected to save its member-dealers $4 million a year. Until recently, the TSE was much less enthusiastic about the prospect of competition from private trading systems. In 1995, it opposed an application by Instinet Corp., a unit of Reuters Holdings PLC, to become a registered electronic broker for TSE members and institutional investors. The OSC approved Instinet's registration, but as an international dealer it is permitted to trade only in foreign securities not listed on a Canadian exchange. Meanwhile, pressure for more sweeping changes is building. In April, the U.S. Securities and Exchange Commission voted to allow electronic trading systems to operate with minimal oversight. One condition is that systems handling more than 10 per cent of the volume of a stock must display orders for that stock on a traditional exchange, so small investors are not left out of the loop. "Our basic philosophy is to get out of the way," SEC chairman Arthur Levitt said in announcing the policy. Already, there are at least 50 alternate systems operating in the United States, including Instinet, Tradebook and Posit. The newest and most sophisticated service is run by OptiMark Technologies of Durango, Colo., which uses a supercomputer that can match thousands of buy and sell orders in a fraction of a second, at lower cost than any human trader. Backed by Goldman Sachs & Co., Dow Jones & Co. and several other big investors, OptiMark will begin trading New York Stock Exchange shares in October. A year from now, it will expand onto the Nasdaq market, home to many U.S. and Canadian high-tech stocks. For Canadian regulators, the issue is no longer whether to allow PETS into the country -- technology and globalization have made that decision a foregone conclusion. The only question is how they should be regulated. Last year, a special TSE committee chaired by Eric Kirzner, a professor of finance at the University of Toronto, recommended that private trading systems should be subject to a self-regulatory organization and should be required to integrate with an established Canadian exchange. Those measures would protect small investors while allowing institutional investors to execute block trades at much lower cost. It remains to be seen whether Canada's securities regulators adopt that position, but no matter what happens the stock-trading business is in for a shakeup I'm trying to figure out if this effects me more to the good or to the bad? Best Regards KEITH