The Big Board Starts To Face Reality

Traditions die hard at the New York Stock Exchange. For years, the trading floor persisted with archaic manual systems. Even when it belatedly admitted the computer, it protected the functions and livelihood of members who worked on the floor. The NYSE continued to insist that specialists, who are supposed to maintain a fair and orderly market in their assigned stocks and who account for a quarter of the Big Board's membership, were crucial to its functioning. Yet in recent years, as competing electronic trading systems siphoned away volume, the exchange has installed several automated systems that have reduced the specialists' role. Specialists are involved in only 20% of the volume. But the exchange's trading role has continued to shrink. More than 40% of the trading in NYSE-listed securities is now being conducted in other markets.

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