Electronic Commerce and the Revolution in Financial Markets

Written by authors intimately involved in researching and shaping the ongoing transformation in financial markets, this comprehensive book offers a rare inside look at the day-to-day operations and developments of the dynamic marketplace. Clearly and concisely outlining how Internet technology impacts financial markets, Electronic Commerce and the Revolution in Financial Markets includes a re-examination of how financial markets like the Nasdaq and NYSE actually work, which parties are involved, how the price is produced, how transactions are settled and much more.

1. Electronic Commerce and the Organization of Financial Markets: The Internet and the Digital Revolution; Financial Markets in the 21st Century: Functions and Institutions; Disintermediation or Reintermediation?; The Value Chain Model; Reinventing the New Value Chain; Financial Portals. 2. Online Revolution: Online Trading; Internet IPOs; Online Brokers; Boom in Online Finance; Online Financial Information; Other Online Financial Services; Communication and Not Computation. 3. Towards a Digital Marketplace: Electronic Markets; Investment Styles and Market Imperfections; A Smart Trading System; Intermediaries as Facilitators; Online Research; Digital Identification; Virtual Transaction Systems. 4. Financial Markets in a Nutshell: Rest of the World; The US Financial Markets; Competition between Markets; Double Auction; Continuous and Periodic Trading; Technology and the Evolution of Markets. 5. The New York Stock Exchange: Double Auction; Order Book; Continuous Trading and Call Auctions; Technology and the NYSE; Issues; Competitive Pressures; NYSE as a For-Profit Company. 6. The Nasdaq Market: A Brief Background; Double Auction; Continuous and Periodic Trading; Role of Technology; Collusion among Dealers, New Regulations; Recent Developments; Plans for the Future; The Nasdaq-Amex Merger; Web-based Services. 7. Market Liquidity: The Pan-European Market; OM Group and OM Stockholm Exchange; The Swiss Exchange; Eurex; EASDAQ; The Australian Stock Exchange. 8. Electronic Communications Network: The US Fixed Income Markets; Advances in Information Dissemination and Electronic Trading; Electronic Markets for Fixed Income Securities. 9. Computerized Automated Trading Systems: Development Since the 1970s; Liquidity; Human Intervention; Institutional Investors; Upstairs Market; Disintermediated Markets. 10. Overseas Financial Markets: ATS and ECN; Crossing Networks; ECNs. 11. Fixed Income Markets: Instinet; The Arizona Stock Exchange; The OptiMark System; Tradepoint, Primex, MarketXT. 12. Unconventional "Financial" Markets: Electricity Markets; Catastrophe Insurance Markets; The Iowa Electronic Market; The Hollywood Stock Exchange. 13. Emerging Technologies for Electronic Markets: Electronic Trading Networks; Web-Based Development Tools; Java for Electronic Markets; Technology Convergence; Secure Transactions; Distributed Computing and Financial Trading Systems; Concurrent Processing and Synchronization; Synchronous Communication; Fault Tolerance. 14. Creative Destruction: Reality Check; Technology Issues; Privacy and Marketing over the Internet; Personalization; Fraud; Online Chat; Policy Issues; A User-Friendly Net; Computer Glitches; Online Security.