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February 1, 2005

Penson's Black Box Expansion

By Peter Chapman

Penson Worldwide, looking to strengthen its position in the black box market, bought historic market data distributor Tick Data. The U.S.'s sixth largest clearing and settlement firm will house the vendor within its recently acquired Nexa Technologies subsidiary. Nexa will market the data service to both Penson and non-Penson customers.

"Tick Data takes us to the next level," says Eric Stoop, president of Nexa. "We've had a lot of the pieces [for black box trading], but now we can make a much larger push."

Tick Data's technology lets black box, or automated, traders research and test equities and derivatives trading strategies against historic market conditions. The deal allows Penson/Nexa to bill itself as a "one-stop shop" for historic and real-time data as well as execution and trade processing. Both Penson and Nexa have serviced statistical arbitrage and other automated traders for years with real-time data and executions. Dallas-based Penson built its business servicing day-trading brokerages and non-broker dealer trading groups.