Commentary

Jared Dillian
Traders Magazine Online News

Was it Worth It?

In this piece from 10th Man, author Jared Dillian discusses how the ETF revolution is less about ETFs and more about indexing; about how people have come to view stocks less as stocks and more as blobs of stocks.

Traders Poll

Would you feel better if the Chicago Stock Exchange were purchased by U.S. firm or consortium rather than a foreign one?

Yes

73%

No

4%

Doesn't matter to me

23%

Free Site Registration

June 30, 2004

Specialists Feel the Squeeze At New York Stock Exchange

By Staff Reports

The dog days of August have come early at the New York Stock Exchange.

A decline in volume has resulted in a group of specialist firms taking some hits as trading on the NYSE has slowed.

Volume on the Big Board was averaging just 1.2 billion shares in the first half of June. The daily average was 1.49 billion shares through the first five months of last year. And, in May of this year, 30 billion shares changed hands on the Big Board. That was the lowest monthly figure since February when only 28 billion shares were traded on the NYSE.

The slowdown has been bad for specialists such as LaBranche & Co., Van der Moolen Holding NV, Spear Leeds and several other similar firms that make markets in NYSE stocks.

LaBranche, which makes markets in 573 securities and is the biggest Big Board specialist, has been hurt over the past two years as its realization rate - the revenue generated by every dollar put to work - declined by half, market observers note. The rate has reportedly dropped from 0.04 percent to 0.02 percent in that period.