A BETTER MOUSETRAP?
United Kingdom startup
tries to spring faster order
and settlement service.
PAGE 14

HOW WALL STREET OPERATES

Volume 21 Number 22 • November 30, 2009

UPTICK p. 4 Mind Over Model

NEWS DESK p. 6

Nasdaq To Party Like It’s 1999

TRADING p. 10

Citigroup’s Smart Option

LAST WORD p. 22

Discovering Price Discovery

Next: Electronic Blitz of Federal Agency Debt Business

SPECIAL REPORT

Pushing Technolog y To Push Trades Faster

By Shane Kite

TRADEWEB IS TAKING AIM at swiping market share from Icap again. This time in the electronic trading of federal housing agency debt between securities dealers.

The move by the dealer-backed Jersey City, N.J., company comes eight months after Tradeweb took 85 percent of the volume in the to-be-announced (TBA)-mortgage market away from Icap, an electronic interdealer brokerage based in London.

Tradeweb launched inter-dealer trading of federal agency debt on Nov. 19 over Dealerweb, the ;rm’s inter-dealer electronic trading platform, said an executive at a ;xed income services provider with knowledge of the initiative.

Tradeweb is positioning Dealerweb to take the market from Icap, the world’s largest inter-dealer broker, like

By John Dodge

ONE WAY FOR AMERICAN brokers to achieve healthier pro;t margins and greater

Cutting Costs in Trading Internationally
By Cutting Out a Clearing Agent in the U.S.

CONTINUED ON PAGE 12

COMPLIANCE GETS
A CORNER OFFICE

The rush to hire chief compliance officers—

and arm them with technology to do their jobs.

STORIES ON PAGES 16, 18

securitiesindustry.com • A SourceMedia brand

visibility into foreign markets when they trade internationally is to eliminate a middleman in the

United States.

The trick? Don’t use a clearing agent in North America. Push settlement and clearing onto a local broker in the country where the trade takes place, thus eliminate steps along the way—and the fees and charges that come with them.

You may not only save time

CASE STUDY

and money. But you can get
smarter in the process, ;nds
Mark Esposito, CEO
of Esposito Securities
LLC in Dallas.
Esposito trades
overseas on behalf of
a range in institutional clients.
Cutting out steps is helpful,
but what matters to him most
is staying close to brokers in
local trading markets.

“The closer you get to the local market center, the more

CONTINUED ON PAGE 20

By John Hintze

QUANTHOUSE ALREADY uses parallel programming techniques in its data-feed product and now it’s exploring ways to incorporate the extremely powerful processing technology, used in advanced graphics and to uncover genetic instructions in DNA research, into its library of mathematical algorithms. The aim: Help high-frequency traders—its customers—construct more elaborate scenarios and strategies that can react in the smallest fraction of a second to market signals.

QuantHouse is not alone. Suppliers of everything from trading systems to network connections are focusing on a bright spot in Wall Street capital expenditures. This year, high-frequency traders are anticipated to spend