Traders Magazine, February 2001
Archipelago Exchange, the all-electronic stock mart, is feeling the heat from critics. Nasdaq contends that the exchange, run as a joint venture between the Archipelago ECN (ARCA) and the Pacific Exchange, avoided serious scrutiny by filing a rule change, instead of a much meatier exchange registration with the Securities and Exchange Commission. Exchange registration would have required Archipelago to provide ownership and financial information.
Another critic, Knight Trading Group, said it is concerned about Archipelago's plan to charge access fees. Dealers have been at loggerheads with ECNs over access fees since the introduction of the order handling rules. Knight also attacked Archipelago for requiring firms to use ARCA's affiliated broker dealer, WAVE. Knight contends that puts Archipelago in a conflict of interest. Archipelago is planning to make a formal response soon to Nasdaq's and Knight's comment letters to the SEC.
All TradersMagazine.com articles are archived after 7 days. REGISTER NOW for unlimited access to all recently archived articles, as well as thousands of searchable stories. Registered Members also gain access to exclusive industry white paper downloads, web seminars, online technology directory, the iPad App, and conference discounts. Qualified members may also choose to receive our free monthly magazine and any of our e-newsletters covering the latest breaking news, opinions from industry leaders, developing trends and trading strategies.