SEC Locks Retail Brokers Out Of Stock Market Reform Meeting

Posted on April 29, 2015 by admin

Brokerdealer.com blog update profiles the SEC intentionally leaving retail brokers out of their upcoming meeting on stock market reforms. The group will meet four times a year and review old rules and advice the SEC on new regulation. Retail brokers are confused because the SEC has always made it a priority to protect retail investors so leaving retail brokers out of this advising group is raising questions. This brokerdealer.com update is courtesy of Reuters’ John McCrank in his article, “SEC’s stock market reform club locks out retail brokers” with an excerpt below.

The U.S. Securities and Exchange Commission is convening a group of financial industry veterans for the first time next month to consider stock market reforms, but one group will be conspicuously absent: retail brokerages.

The SEC’s 17-member Market Structure Advisory Committee includes representatives of fund companies, an exchange, off-exchange trading venues, dealers, and academia, among others. The group, which meets four times a year, will review old rules, and advise the SEC on a range of new regulations designed to make sure the market is as stable and fair as possible.

Still, given that the SEC has said its main priority is to protect retail investors, the omission of retail brokers raises questions, because without their point of view the panel may recommend changes that favor institutional investors, analysts said. Retail investors place around 16 percent of all U.S. stock orders.

“There’s a missing gap of protecting retail order flow,” said Larry Tabb, chief executive of capital markets advisory firm TABB Group.

That gap was also noticed by committee member Joseph Ratterman, chairman of No. 2 U.S. exchange operator BATS Global Markets. He said he mentioned his concern to SEC Chair Mary Jo White shortly after the committee was announced and that she was supportive of him, along with committee member Jamil Nazarali, from market making firm Citadel Securities, formally representing retail interests.

To continue reading this article from Reuters, click here.

BrokerDealers Bringing In The Bucks:

Posted on April 28, 2015 by admin

BrokerDealer.com blog update profiles the revenue and profit performance of the US Broker-Dealer space as demonstrated by the pricing action in the iShares US Broker-Dealer ETF (NYSE:IAI) when compared to the returns of the S&P 500 (see chart). Below extract is courtesy of coverage from ETFtrends.com.

Independent broker-dealers generated double-digit revenue growth in 2014, and a broker-dealer- related exchange traded fund is outperforming in the financial space so far this year.

BrokerDealer.com database is the global financial industry’s leading source of BrokerDealer information, with detailed information on thousands of BDs in upwards of 30 countries worldwide.

Over the past three months, the iShares US Broker-Dealers ETF (NYSEArca: IAI), which tracks U.S. investment banks, discount brokerages and stock exchanges, has increased 7.8%, compared to the 2.5% gain in the broader Financial Select Sector SPDR (NYSEArca: XLF). Year-to-date, IAI was up 0.7% while XLF dipped 1.5%.

The 25 largest independent broker-dealers generated a 10.3% year-over-year rise in revenue over 2014, reports Bruce Kelly for InvestmentNews.

Top independent broker-dealers include LPL Financial LLC (NYSE: LPLA), which garnered $4.3 billion in revenue, and Raymond James Financial Services (NYSE: RJF), which added $1.6 billion. IAI includes a 3.4% tilt toward LPLA and a 4.7% weight in RJF.

The industry is experiencing an increase in fees. Revenue from investment products and services that charge a fee instead of a commission rose 20% in 2014 among the top 25 independent broker-dealers, mirroring a growing trend in the services industry.

For the full article from ETFtrends.com, please click here

This is Best Time To Raise Money, Ever

Posted on April 20, 2015April 20, 2015 by admin

BrokerDealer.com blog update is courtesy of curating various stories with special credit to NYT reporter Farhad Manjoo, profiling Stewart Butterfield, the CEO of start-up Slack, an enterprise messaging company. Manjoo’s article “Is Slack Really Worth $2.8 Billion? A Conversation With Stewart Butterfield” is extracted below.

By Farhad Manjoo

April 16, 2015 6:27 pm April 16, 2015 6:27 pm

When I recently wrote about Slack, a corporate messaging app that has aspirations to replace email, investors valued the company at $1 billion. That was a month ago. Today, the start-up announced that it has raised $160 million from a half dozen investors, and that it is now worth $2.8 billion.

Slack, which is just a year old, has more than 750,000 daily active users, 200,000 of whom are paying customers. By many estimates, it is the fastest-growing business application of all time.

Still, Slack’s escalating valuation in such a short time seems destined to spark questions about the rising possibility of a tech bubble. I asked Stewart Butterfield, Slack’s co-founder and chief executive, about the company, its growth and the bubble in a wide-ranging conversation this morning.

Q. I’m surprised that you’re raising money, because last time we talked you said that you had enough money.

A. Do you have enough money?

Q.No. But it’s not free money, right?

A. It’s pretty straightforward. I’ve been in this industry for 20 years. This is the best time to raise money ever. It might be the best time for any kind of business in any industry to raise money for all of history, like since the time of the ancient Egyptians. It’s certainly the best time for late-stage start-ups to raise money from venture capitalists since this dynamic has been around.

Adultery Website Wants Hook Up With Brokerdealers In An IPO

Posted on April 17, 2015 by admin

Adultery website AshleyMadison attempts for a second IPO

Brokerdealer.com blog update profiles website AshleyMadison, an adultery website seeking to an IPO for the second time. The company has been experiencing a boom in business and wants the funds for marketing and international expansion. This brokerdealer blog update is courtesy of Bloomberg Business’s article, “Adultery Website AshleyMadison Seeks IPO as Demand Booms” with an excerpt below.

AshleyMadison.com, a dating website for cheating spouses, wants to hook up with investors by pursuing an initial public offering in London this year.

The site’s parent company, which failed with a previous IPO attempt in Canada, said on Wednesday it is looking to raise as much as $200 million to exploit booming demand for its services.

AshleyMadison had sales of $115 million last year, an almost fourfold increase on 2009, Christoph Kraemer, its head of international relations said in an interview. It makes money by charging men for credits, which they then use for introductions to women.

Avid Life Media Inc., the Toronto-based holding company that runs AshleyMadison.com along with peers Cougarlife.com and EstablishedMen.com, wants the new funds for marketing and international expansion.

AshleyMadison has 36 million members in 46 countries, Kraemer said, and claims to be the world’s second-largest paid-for Internet dating website, behind Match.com.

While the U.S. accounts for about 50 percent of its business, Kraemer said “Europe is the only region where we have a real chance of doing an IPO” because of its more liberal attitude toward adultery.

“We’re no longer a niche, but it’s been difficult in North America to find the support to go public,” he added.

To continue reading about the success of this adultery website and its second attempt at an IPO, click here.

BrokerDealer Firm Focuses On Bitcoin

Posted on April 16, 2015 by admin

A bitcoin sticker is seen in the window of the 'Vape Lab' cafe, where it is possible to both use and purchase the bitcoin currency, in London

Brokerdealer.com blog update profiles the continued interest in the bitcoin craze. While some bitcoin advocates prepare to launch an bitcoin ETF, another is preparing for a bitcoin IPO, and another is pushing New York City accept them as payments for fines. Now, one New York- based firm, founded by a bitcoin advocate, is rebranding its brokerdealer division to specialize in digital currency trade, mainly bitcoins. This brokerdeaeler blog update is courtesy of Reuters’ article, “Bitcoin-focused firm rebrands broker-dealer for digital currencies” with an excerpt below.

Digital Currency Group, a New York-based entity founded by bitcoin advocate Barry Silbert, rebranded its broker-dealer division of SecondMarket Inc specializing in trading virtual currencies including bitcoin, according to a press statement on Thursday.

The Trading Division of SecondMarket Inc is now called Genesis Trading and focuses solely on institutional clients such as hedge funds and alternative asset investors, it said.

The rebranded Genesis Trading has executed over $25 billion in the trading of specialized fixed income securities over the last two years, said Chief Executive Officer Brendan O’ Connor.

The division also carried out trades for more than 800,000 bitcoins worth over $300 million, making the company the bitcoin industry’s largest over-the-counter trading desk.

“Our goal is to become the partner of choice for large institutional buyers and sellers who are beginning to recognize the economic potential of digital currency,” said O’Connor.

To continue reading about this brokerdealer firm’s shift to bitcoin trading, click here