Om Malik

From Traders Magazine, June 1998 issue

As STRIKE, the name on the hottest new electronic communications network (ECN) simply suggests, Bear, Stearns & Co. is planning for war – a price war.

STRIKE, the ECN sponsored by Bear Stearns, is going live this summer backed by some of the New York-based firm’s Wall Street peers. And millions of dollars and potential profitability are at stake.

Arthur Pachecho, Bear Stearns’ co-head of Nasdaq trading, and president and chief executive of the firm’s affiliated STRIKE unit, said the new ECN is being marketed as an attractive alternative to Instinet and other ECNs.

Commissions

STRIKE’s best weapon may be its commission schedule. Pachecho said STRIKE will charge customers “substantially” lower commissions for executions than its competition, but declined to elaborate.

Instinet, owned by London-based Reuters Group PLC, is the largest ECN approved by the Securities and Exchange Commission under terms of the order

From Traders Magazine, April 1998 issue

Traders hate rude interruptions. A breakdown in market-data systems leads to pandemonium. A faulty telephone connection is taboo.

So it is with a certain resignation that Nasdaq market makers are bracing for another interruption, and with nary a word of protest the implementation of the Order Audit Trail System, or OATS.

On March 16, the Securities and Exchange Commission made OATS official, mandating Nasdaq desks to install the real-time electronic system for gathering and reporting more than two-dozen trade details directly to the National Association of Securities Dealers. That’s a mammoth operational challenge, as desks now have up to 90 seconds to send trade details after an order is executed.

But it wasn’t exactly a sudden surprise. Several years back, OATS was a foregone conclusion. The NASD agreed to implement OATS as part of its settlement with the SEC in 1996.

OATS places a

From Traders Magazine, February 1998 issue

Traders are busy people, swamped in market data. So how do they find time to use this data effectively? Try market-data systems that are open, interactive and easily welded to other systems and information sources.

Speed and flexibility are the big kahuna.

In what may be a backlash against proprietary hardware, the market-data industry is undergoing a paradigm shift, moving like the rest of Wall Street from terminals and boxes to systems that are open, fast and more malleable.

Utilize Information

Technological change has swept market-data vendors off their feet, forcing them to de-emphasize hardware and to sell systems that utilize information more efficiently.

Perhaps nowhere is this more evident than in the latest avatar of Bridge Information Systems’ Bridge WorkStation, which runs on a 32-bit Windows NT platform. Bridge and many of its competitors are now striving towards making their systems more interactive.

From Traders Magazine, October 1997 issue

When the Pacific Stock Exchange (PCX) received Securities and Exchange Commission approval last month to operate the OptiMark trading system, the pioneer of the new electronic facility, William Lupien, breathed a sigh of relief.

This was one of the many hurdles Lupien had to overcome before his latest brainchild, OptiMark, a black box that executes block orders with unprecedented anonymity, becomes the Instinet of the 21st century. While an Instinet comparison is not entirely fair, it is hard to talk about Lupien’s accomplishments without mentioning the looming presence of Instinet, the trading system he made into a global powerhouse.

Trading Volume

In his five years at Instinet, Lupien, a former PCX specialist trader, presided over a 1,100 percent increase in trading volume, enough for Reuters to pay millions of dollars to acquire the system.

Not satisfied, Lupien now wants to upstage Instinet, starting with