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Elaine Wah

Modern Markets, Modern Metrics - A Blog By IEX

In this blog by IEX's Elaine Wah, the newest public exchange looks to refute public claims that the metrics it uses are designed to inflate its own volume numbers and mislead people.

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June 30, 2004

A Room With A View

By Ingrid Eisenstadter

It's a sunny morning and the markets are buzzing. Outside, birds are softly chirping and the scent of perfume hangs in the air. Inside, thousands of traders from coast-to-coast are yelling on exchange floors, or sitting elbow-to-elbow at workstations. Some are chasing down hallways to client meetings and strategy sessions.

But not Thomas K. Doyle.

Institutional trader Doyle is in his sunny home office - and trading room - in the exurbs of Alford, Massachusetts, population 464. His own nearest neighbor is too far away for him to see. The noises that interrupt Doyle are the wind whistling in his apple orchard, an occasional stomping bear, flocks of wild turkey, coyotes and deer whipping through his yard. "And my neighbors have seen bobcats," Doyle says with some enthusiasm.

No, not every trader can hunt from his office window. In this lush Berkshires setting, 140 miles north of the Street in New York City, Doyle, who works full-time for Connecticut-based Nutmeg Securities, can trade up to one million shares on his busiest days. He executes orders for his two dozen institutional clients.

Just 135 years after Western Union began telegraphing share prices to mustachioed gentlemen who had to jostle each other for a gander at the tape, Doyle sits at home alone with a Compac EVO N800 laptop. He also has a desktop PC to back it up, a satellite hook-up, a dial-up connection to back that up, and a wireless network.

Today, Doyle has all the order routing, liquidity-pool monitoring and settlement capabilities at home that anyone stapled to an urban trading room desk chair has.

Nutmeg selected the Maslow Order Management and Trade Execution System, operated by Arrowhead Solutions, for its traders. And that's the platform Doyle uses from home. "I can route orders directly to brokers on the floor of the exchanges," Doyle says, "or go directly to specific market makers, as well as a variety of ECNs." And he succeeds at best execution, beating VWAP 60 percent of the time, he tells Traders Magazine.

Matthew Rochlin, President of Nutmeg, says that in his own travels he is not aware of other institutional securities firms that provide an arrangement for traders similar to Doyle's. At Nutmeg, however, five of the company's 21 traders work remotely. With his own clients, Doyle makes no secret of working from home and says that, "if anything, they value the additional measure of privacy" as he places their trades.

No Elevators

It was 1997 when Tom Doyle left the conventional Wall Street life behind, after a quarter century as an institutional equities and options trader at Pershing & Co. in New York City. He became the firm's youngest partner. Later, he was a managing director of Rochdale Securities. Doyle changed firms but didn't change buildings. "I worked at 120 Broadway for 25 years," he says, "and the only thing I changed in all that time was elevator banks." In those days, Doyle, a New York City native, commuted to the Street on the Long Island Railroad. "Today I get up at about the time I used to arrive at Penn Station," he says. His current commute is from the bedroom to the cathedral-ceiling loft room in which he works.

The dress code is casual. Working hours, however, are the usual times. Doyle is at his desk by 8:30 a.m. and he stays there until between 5:00p.m. and 6:00 p.m. Still, he has options that other traders do not have. If he doesn't feel like having lunch at his desk, he disconnects his laptop from its docking port and goes wireless into his kitchen to check out what's in the fridge. And then, perhaps, a picnic in his yard.

Two or three times a year Doyle makes the two-hour drive to Nutmeg's Fairfield, Connecticut, headquarters so his boss can remember what he looks like. Leading a seemingly perfect life, Traders Magazine asked Doyle, what aggravates him?

"I have to keep the rabbits out of my fiancee's garden," he laments. Tough life.