TRANSACTION TAX TSUNAMI
Congress wants to raise
$150 billion. Could that kill
high-frequency trading?
MONDAY MONITOR
Only;on;securitiesindustry.com
HOW WALL STREET OPERATES
volume 22 number 1 • January 11, 2010
UPTICK p. 4
A Wall Street Meter
OPERATIONS p. 16
Recounting the Basis of Cost
RISK p. 19
The Real-Time Revolution
LAST WORD p. 23
Fast Trading Not a Zero-Sum Game
In;Icap’s;World,
Offense;is;the
Best;Defense
TRACKING TIME
By Shane Kite
Icap Is InvestIng mIl-
lIons to diversify its business
beyond being the world’s larg-
est inter-dealer broker of U.s.
treasury bonds, foreign ex-
change and interest rate swaps.
the london-based company
now wants to dominate markets
in such diverse businesses as
post-trade
derivatives
processing,
execution
services in emerging markets
and global equities trading.
the firm said in november
it had pumped $61 million into
building out those new areas
of potential growth during
six months ended sept. 30 and
that it will continue to invest
into 2010.
the point: to shore up and
expand revenues as its core line
of services face unprecedented
challenges from competitors as
financial regulations on both
sides of the atlantic change.
the biggest competition
Icap faces comes from its own
By Carol E. Curtis
despIte the ImpendIng
retirement of senate Banking
Financial Reform 2010: “Mild” Change
May Be Result of Weakened Final Package
CONTINUED ON PAGE 20
CASE
STUDY
Block Trades
Getting Placed
on Alternative
Blotters
THE LATENCY BUDGET
Time is money. The latest challenge:
Keeping track of each microsecond it
takes to execute a transaction. Then,
managing the costs of speeding things up.
MANAGING TIME & MONEY, Page 8
SETTING STANDARDS, Page 11
By John Hintze
lIqUIdnet has long toU-
ted its access to roughly 2. 6
billion shares of buy or sell
orders that it monitors on its
members’ trade blotters for po-
tential matches—an approach
it pioneered—as proof of just
how liquid its electronic trad-
ing network is.
But that number plummet-
ed 37% in november to 1.6
billion shares compared to the
same month a year ago and is
down 22% through november
for all of 2009, according to
liquidnet’s website.
trading across the broader
market also slowed in the lat-
ter half of 2010. however, one
likely factor could continue to
sap the liquidity of liquidnet
and its “blotter scraping” com-
CONTINUED ON PAGE 12
committee chairman chris-
topher dodd, d-ct., the sen-
ate is likely to pass a financial
regulatory reform package
that is weaker than the ver-
sion approved by the house on
december 11.
and action could be slow,
with the final senate bill pos-
sibly not ready until spring.
“the senate bill will be
less strict, because it has to be
more bi-partisan according to
the rules of the senate,” pre-
dicts Robert colby, counsel in
the Washington office of law
firm davis polk and Wardwell
llp, and former deputy direc-
tor of the securities and ex-
change commission’s division
of trading and markets.
Barometer;of;Wall;Street’s;Health
FIN5OINDEX
securitiesindustry.com • a sourcemedia brand
Dec. 31, 2009 - Jan. 7, 2010
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