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Momtchil Pojarliev
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Some Like It Hedged

BNP Asset Management's Pojarliev discusses a variety of options to address foreign currency exposures. Although there is no single best-practice solution for addressing foreign currency exposures, institutional investors have three main choices, he says.

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September 30, 2000

ATS and Broker Dealer Plan for Listed Stocks

By Peter Chapman

NYFIX Millennium L.L.C. is joining with S.G. Cowen Securities to enable regional specialists to quote their markets on the Millennium alternative trading system for listed stocks. The participating specialists will become, in effect, third market dealers.

The deal with the specialists is expected to increase the liquidity of the ATS, according to Dean Stamos, president of the New York-based NYFIX Millennium.

About 52 specialists on the four floor-based regional exchanges can now quote their markets on Millennium from their primary-market access terminals, operated by Cowen, a broker dealer also based in New York.

Cowen's execution department maintains 240 of these terminals on the Boston Stock Exchange, the Pacific Exchange, the Philadelphia Stock Exchange and the Chicago Stock Exchange. Specialists use them to connect to the SuperDOT and PER systems of the New York and the American stock exchanges, respectively, to lay off positions.

NYFIX, Inc., parent of NYFIX Millennium, under a separate agreement, is rebuilding the terminals.

The parent company routes orders - accounting for roughly 300 million shares per day, it says - to U.S. stock exchanges. The company has integrated Millennium into its network to capture and find matches for these orders. Orders not immediately matched either continue on their way to the exchanges or wait for a possible match later.

For the specialists, recently freed by the rescission of certain exchange rules to trade off-board, the deal offers two advantages, according to NYFIX. They get a crack at NYFIX-routed order flow that might not now make it to their exchange. And they get a chance to trade against order flow earmarked for one of the primary exchanges.

As newly minted third market dealers they would join Knight Capital Markets, the third market division of Knight Trading Group, which agreed to make markets on Millennium in July.