Wall Street consortium to launch trading system

28 September 2006

A consortium of Wall Street-based companies is planning the launch of a new electronic block trading system, according to reports.

According to the Wall Street Journal, six companies including big names such as Citigroup, Goldman Sachs, Lehman Brothers and Merrill Lynch & Co make up the consortium, which is to be called Bids (Block Interest Discovery Service).

The consortium is believed to be planning to launch the new trading service, providing a direct rival to the current dominance of the New York Stock Exchange and the Nasdaq, in early 2008.

The report says that initially, the service will aim to handle only around one per cent of overall stock trading volume – the equivalent of 50 million shares a day.

However, it is expected that very large trades typically made by mutual funds or big investors are also to be handled, potentially making up for the low overall volumes.

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