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Tim Quast
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We're All HFTs Now

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June 30, 1999

Early Thoughts on Late Trading

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  • Early Thoughts on Late Trading

When the National Association of Securities Dealers announced in May its intention to launch after-hours trading on Nasdaq, many applauded the move as a great benefit to retail investors. For the first time, investors placing orders in the evenings would be able to have their trades executed immediately.

But many equity traders have reservations about Nasdaq's intention to lengthen its day. Supporters and detractors alike are struggling to plan for extended trading hours not only on Nasdaq, but across Wall Street.

Some market participants offer opinions and reservations on after-hours trading. -M.L.O.

"With [an extended session] on Nasdaq, I might be more inclined to commit capital. But with a [Securities and Exchange Commission] Regulation ATS [system] open after hours, I would participate in a more measured way. I would commit capital, but just not as much. I would probably be more of a processor and less of a liquidity provider." -Kenneth Pasternak, president and chief executive of Jersey City-based Knight/Trimark Group, parent of leading Nasdaq market maker Knight Securities

"It shouldn't have much of an impact on institutional desks. It will give us more time to fill orders if there's liquidity and volume in the extra session." -Terrence W. Goodwin, managing director at Chase Asset Management in New York, on the effect of after-hours trading on buy-side traders

"Over time, all exchanges will be open for much longer hours. To fight it would be like standing in front of a truck. Trading as an agent will make things easier, not having to risk capital in a volatile market. Finding the other side when prices are up or down from the previous close could be difficult." -Robert P. Ross Jr., chairman of GRO Corporation in Houston, an eight-employee discount brokerage

"Small broker dealers don't have the staff to accommodate extended trading hours. The general investing public is not served by the plan. Until it can be proved that it serves the investing public, I am against extended trading, and the firm feels the same way."-Nicholas Ponzio, managing director at Jersey City-based market maker Hill, Thompson, Magid & Co.

"We should have it. When was the last time you went to a mall and it closed at 4 p.m. The market should be made convenient to the public. The problem is that certain people in the market don't want to work that hard. You should work to cater to your clientele." -Harvey Houtkin, chairman and chief executive of Montvale, N.J.-based All-Tech Investment Group, a day-trading firm and operator of the private network ATTAIN

"From a structural point of view, you have to make a decision who is going to trade for you. You can't have one trader handling 100 Nasdaq stocks. It will be a manpower issue. I don't want market makers to work all day and then have to stay until 9:30 [p.m.]." -Tony Cecin, head of equity trading at U.S. Bancorp Piper Jaffray in Minneapolis