Daiwa Plans to Offer Odd-Lot Trading System for U.S. Issues
Daiwa Securities America Inc. plans to introduce the first fully automated trading system for institutional buyers and sellers of U.S. government securities.
Daiwa is one of about 40 commercial and investment banks that act as primary dealers in the highly competitive, $100 billion-a-day market for U.S. Treasury securities. Others include Citicorp, Chase Manhattan Bank Corp., and BankAmerica Corp.
Daiwa's system, which is for odd-lot transactions, is to go live in the next few weeks. Permission is pending from the Securities and Exchange Commission.
An IBM Connection
Daiwa would install the system, called the Odd-Lot Machine, at customer sites for no charge. It runs on personal computers from International Business Machines Corp. and is available to U.S. users through the IBM Information Network.
The Odd-Lot Machine would provide on-line market access to those who buy and sell government securities in transactions of less than $1 million. The product establishes Daiwa in the odd-lot trading business for the first time while helping the company contain its personnel costs.
Gib Clark, chief Treasury trader at Daiwa, developed the system. "We're trying to provide the customer with a quick and efficient means of executing orders," he said. "The customer will always know where the issue is, without having to call us."
Another company, New York-based Electronic Joint Venture Partners, also announced an automated trading system for government securities this month. That system is for brokers to match buy and sell orders with the primary dealers; it cannot by used by institutional customers.
