Commentary

Traders Magazine Online News

Spoofing, Surveillance and Supervision

Jay Biondo, Product Manager - Surveillance at Trading Technologies, co-authored an article along with James Lundy and Nicholas Wendland, both of Drinker Biddle & Reath LLP, reviewing the CFTC's regulations and expanding efforts, 21st century surveillance and supervision, as well as strategic recommendations.

Traders Poll

Is the adoption of electronic trading in fixed income on par of that in the FX sector?




Free Site Registration

May 31, 2004

The Best of Times, The Worst of Times

By Peter Chapman

Wall Street's equity desks turned in another poor year in 2003.

Members of the New York Stock Exchange and NASD reported equity sales and trading revenues of $22.7 billion last year, according to the Securities Industry Association. That's a decline of eight percent from 2002 when the equities business generated revenues of $24.9 billion.

The decline cut across both listed and Nasdaq desks. The listed business, by far the larger of the two, took in $19 billion in commissions. That's down from $21 billion in 2002. OTC sales and trading earned $3.7 billion last year, down two percent from the prior year.

Share volume figures explain part of the drop. Trading in both New York and Nasdaq shares last year was largely unchanged from 2002. New York listed names traded 1.7 billion shares per day on average. Nasdaq names traded 1.4 billion.

Commission rates are the other reason for the revenue decline. The SIA notes that program trading, with its lower per-share rates, is growing faster than trading overall. Indeed, it now reportedly accounts for nearly half of all shares traded on the New York Stock Exchange.

However, the news is not all bad. Brokerage proprietary desks are believed to have had a banner year. The SIA does not break out proprietary revenues by asset class, but reports "all other trading" soared.