On sales trading
What we’ve tried to do is give the sales trader a lot more discretion-in terms of what venues they have the ability to access-and more tools on their screens to execute trades. With that in mind, sales trading becomes a more complex function because it pushes best execution one step closer to the customer. Going forward, I would expect the sales traders to have more ability to handle and to execute their orders. And we’ll probably draw upon our position traders for some of that experience and just remove the hop between the institutional customer, the sales trader and the person handling the order.
On CCAs
I think we’re still doing business with the same number of accounts, or more. We’re seeing growth in hard dollar payments, but it doesn’t seem to be at the expense of growth in the commission dollar business, as well. We’ve seen an increase in the number of checks we’re receiving, and the amount of dollars we’re receiving by checks. But at the same time it appears that our commissions received by way of execution services are at least holding steady and/or rising.
On doing business in today’s market
We’ve had to leverage more and more business onto existing headcount. In previous times, we may have expanded more than we have this time, but there haven’t been any manpower issues aside from the fact that we’re all doing a lot more than we ever did before. Our days are getting longer. We’re wearing many hats. We’re all accessing multiple markets and taking on multiple roles.
On fragmentation
We have a multitude of venues to choose from; the average trade size has shrunk. But we feel like we’re using the right tools to access the variety of market venues. [Fragmentation] hasn’t impacted us to the degree that it’s more difficult to trade, per se. The dark venues constantly present a challenge as they arise. But I do see a situation similar to the ECNs over the years where I would expect to see some consolidation there.
On “gray” pools
It’s going to require more knowledge of the dark pools that you participate in. The difficult part is eliminating the noise and establishing a correlation between your orders pinging in the marketplace and the reaction it’s generating. You have to determine quickly if the small executions you’re achieving are working contrary to your order’s ultimate intent. So, we constantly try to evaluate the methods that we use to access the markets and make sure that we don’t signal our intentions in a way that would cause a negative reaction. It’s an area where we need to tread lightly until we get a better handle on it.
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