How will the Internet change derivatives trading?
No one knows for sure, but everyones got an opinion. By Robert Hunter When on-line retail equity trading systems such as E*Trade and Ameritech first burst into the American financial consciousness, people on the institutional side of Wall Street paid little attention. After all, they argued, traders and salespeople in the capital markets provided far more value to their customers than mere blips on a screen ever could. But Wall Street quickly shook off its complacency as the day-trading boom took off. Before long, Merrill Lynch and other brokerage firms were offering internet trading to their retail clients. And nowadays, brokerage firms of all types are looking in the mirror and wondering what role theyll play in a world of cheap trades and quick execution. Will the sweeping changes that have swept the retail brokerage business affect the derivatives world? Why, after all, should an end-user deal with a broker or dealer to execute a plain vanilla swap when thousands of like-minded pla
