Datek Goes Direct-Access

Discussion in 'Trading' started by Baron, Dec 9, 2000.

  1. Baron

    Baron ET Founder

    December 4, 2000 - Datek Online Brokerage Services LLC, a subsidiary of Datek Online Holdings Corp., today became the first major online brokerage firm to allow its customers to direct Nasdaq trades to the Electronic Communications Network (ECN) or market maker of their choice.

    "We have developed Datek Direct* at the request of many active customers, who want the flexibility to select the execution venue for their orders," said Ed Nicoll, Chairman and Chief Executive Officer of Datek Online Holdings Corp. "These investors want the ability to choose an ECN or market maker based on their own selection criteria."

    Datek Online customers will continue to have the ability to bypass Datek Direct and utilize Datek's highly acclaimed intelligent order-routing system.

    Customers who enable their accounts for Datek Direct have five routing options:

    1. Island only: Limit orders can be routed to The Island ECN, Inc., an affiliated alternative trading system that offers one of the deepest and most liquid markets for Nasdaq stocks.
    2. Nasdaq SelectNet to an ECN of their choice: Customers can route their limit orders over SelectNet directly to ECNs such as Archipelago, Instinet and others.
    3. Nasdaq SelectNet to a market maker: Customers can choose to have their orders presented to one of hundreds of competing market makers in the Nasdaq system.
    4. SOES: If SOES (Small Order Execution System) eligible, marketable limit orders or market orders entered into the (SOES) are routed to a market participant whose bid or offer matches the National Best Bid or Offer (NBBO). Market makers participating in SOES are assigned executions on a rotating basis.
    5. They also may choose Datek Online's automatic intelligent order-routing system, which ordinarily handles Datek trades.

    Furthermore, to enhance the speed and quality of execution, all orders routed through Datek Direct will be checked against the price on The Island ECN to determine if a customer's price can be matched or improved upon. The first phase of Datek Direct applies to Nasdaq securities. In the future, customers will have the ability to route listed transactions.
  2. wshi88


    But I heard it's still web browser based, not a stand alone software.
  3. Hi

    The Wall Street Journal just did an interview with me about what direct access means to the retail investor which should be out next week. Unfortunately Datek and ETrade (both have direct access coming out) are still web based and the minimum for the accouts is relatively low for daytrading. If you have $5000 and make 200% That's $10,000 for spending hours behind a screen it means being paid less than minimum wage. There is also a learning curve for trading and w/ small accounts they may not last long enough for them to realize the gains. As I told the WSJ direct access is great for the trader who knows what he is doing. It can also kill someone. When you have a 16 yr old do you give him the keys to the $300,000 sports car or the used chevy to learn to drive. Most 16yr olds would kill themselves with that sportscar.

    Robert Tharp
  4. xll


    How'd the seminar go this weekend that you're helping out with in San Diego -- you know, the one with Brian June and Van K. Tharp -- that costs $3495 ?? Brian is the trader right? Seminars are his hobby, I guess.
  5. if it's browser based, what's the point... by the time you type it in, and type your password, quotes have already moved away from your price....
  6. I've used it, and it's definitely not up to par yet. It is browser based, and the L2 screen is behind the market. If speed is your game, Datek Direct is not the place to be.
  7. on Seminar

    Brian is the main trader of the seminar. It went well. I got a few ideas I'll test in the market that will definitely give me more of an edge. I have a better feel for systems in a non trending market, Van Tharp also does trade but usually swing trading , longer term position trades, and a lot of his top students he trades by funding them.

    Robert Tharp
  8. Baron

    Baron ET Founder

    Just wanted to say that Datek Direct has been added to the brokers list. So if anybody has used this service, please use the <a href="">ratings system</a> to give us your feedback.

  9. I hear a lot about IB. Is that in most opinions a good direct access platform? I've lookinginto Cybertrader and others and don't wnt to pay that much as I like to limit my trades to 100 to 200 shares. Thanks
  10. fleance


    Re: IB, there are several long message threads on it elsewhere on the site, also on SiliconInvestor.

    I recently opened an account with them to compare with CyberCorp which is my main broker. (I also use NDB and Datek)

    So far, I have done about 500 trades and overall the executions are just as good as CyberCorp. So far, I haven't had any disconnects or other problems.

    However, their order entry interface is not optimized for quick entry and batch entry. Also, because there system handles stocks, options, and futures trading, the interface is not optimized for buying/selling stocks. In order to buy a stock you have to click "Add Ticker" which pops up a window where you type in the symbol name, hit OK, then another window pops up where you select the route (Best, Island, Redi, etc.) and then the resulting 'contract' shows up in their order entry table like "SUNW S ISLAND NMS" which means SUNW, Stock, Island Route, NasdaqMarket. That brings up the second bad interface problem -- the only way to change the order route is to add the ticker again with the new route which will create another contract, e.g. "SUNW S REDI NMS". The rest of the order entry is OK, but still inferior to CyberCorp. Also, they do not offer an ECNOnly Route which I use alot with CyberCorp. The organization of your account Information and executions is also very poor compared to CyberCorp.

    I have been thinking about trying TradeScape which charges 1.5c per share, because they have a much nicer looking interface, but I haven't heard much about them.
    #10     Mar 9, 2001