The latest word in alternative trading systems and conventional market making is co-habitation.
CyberCorp.com, the online broker, is planning to start offering institutions electronic access to the Nasdaq and listed markets via its "direct-access intelligent order routing" service.
Customers of this service are viewed as very important by Jersey City-based Schwab Capital Markets and Trading, which runs CyberCorp. since Charles Schwab & Co. acquired it earlier this year.
While many of these counterparties are direct competitors of Schwab, CyberCorp. does not believe it is shooting itself in the foot. "We can exist side by side," said Philip Berber, founder of the Austin, Texas-based electronic brokerage. "There is no conflict."
Berber said Schwab's sales trading team will continue to service its institutional clients while CyberCorp. will tout its product to hedge funds and other institutional accounts "interested in embracing an electronic service." CyberCorp.'s innovative technology "hunts and seeks" superior counterparties for its customers among electronic communications networks, traditional exchanges and market makers.
CyberCorp., which handles about 20,000 stock trades daily, sees more growth coming in the electronic arena. "The proportion of institutional volume conducted electronically will grow," Berber said. "We are convinced of that."
Separately, CyberCorp. has introduced an audio chat room for its online traders. "It works like a conference call," said a spokesman for CyberCorp. After the regular trading day closes at 4 p.m. Eastern time, a second chat room hosted by CyberCorp. staff will have information on trading, technical and other topics.
