Instinet Making Options Platform Acquisition (NMR)

By Douglas A. McIntyre Updated Mar 19, 11:34AM EDT · Published Aug 26, 10:20AM EDT

Follow 24/7 Wall St. on Google

This post may contain links from our sponsors and affiliates, and Flywheel Publishing may receive compensation for actions taken through them.

Instinet is often thought of as one of the oldest electronic communications networks, or ECN’s, which traders have used for years for equities trading; but now it is effectively an agency broker. It looks like Instinet’s platform is about to be expanded into options with an acquisition. This morning came an announcement that Instinet has agreed to acquire substantially all the business and assets of TORC Financial, LLC. TORC is a provider of derivatives trading technologies. Instinet noted that this will give immediate access to TORC’s suite of options-focused and ‘broker-agnostic solutions’ for institutional derivatives trading. As far as what the terms were, financial terms were not disclosed in the announcement.

The solutions include execution, analytics and risk management capabilities. The company has noted that trading in derivatives is evolving in a manner very similar to the cash equity markets over the last decade
and that US options volume has grown by almost 20% each year since 1995. The firm also pointed to a study from earlier this year showing that some 63% of options traders expected to increase their options volume in 2009.

TORC has a full suite of derivatives trading technologies, including TOP (TradeSpeed Options Professional), a multi-asset class application that offers integrated options analytics and execution capabilities and is integrated with most major US-based prime brokers. Its other listed service is RiskPro, which allows for the real-time tracking of risk metrics across positions, accounts, groups, asset classes and trading desks.

Instinet currently offers a global network of agency-only brokers and offers the Chi-X® trading systems. The company is now a wholly-owned subsidiary of Nomura Holdings, Inc. (NYSE: NMR).

JON C. OGG
August 26, 2009

About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.