Dormant/Half Year Resolution

Due to the press of business and my lack of energy, I have been remiss in not posting for some time. A pair of new hires commented that they actually read my blog so I will make the effort to post more frequently.

Seed Money: There have been several articles in the press recently discussing the plight of the Specialist community and their ability or willingness to seed new products.

My view is that there is still Seed money available but that the Specialist are now in a buyers market with a large present and future inventory of ETFs to choose from. As a result of this glut, the Specialists are able to pick and choose. The truly standout products still attract larger seed while the less sure products, especially coming from less established Issuers are receiving much lower initial seeds.

Another factor having an affect on the Specialists is the multiple venues currently available. NYSE, Amex, and ARCA with NASDAQ pushing at the door make it more difficult for Issuers to demand and receive large Seed commitments. Not all of the Specialist/Lead Market Makers are able to participate on every Exchange and it is still not clear which venue is the best for either issuers or Specialists. It should be year end 2007 before patterns start to be more clear. NYSE moving their ETFs to ARCA eliminates one venue but NASDAQ entering in late summer  adds another.

What at first appeared to be a quiet new issue summer is fast filling in. What the industry needs is two months with no issues. The Specialists could work off seed, take vacations and come back in September refreshed. MAybe we should adopt the school year concept.


2 Responses to “Dormant/Half Year Resolution”

  1. 1 Jessica Keogh July 3, 2007 at 1:08 pm

    Remember me? You may remember me as Jessica Hendrickson. Just wanted to let you know that I too read your blog and enjoy it. Looking forward to hearing more of your insights. Hope all is well.

  2. 2 August 17, 2013 at 4:29 pm

    Piece of writing writing is also a excitement, if you
    know after that you can write if not it is complicated to write.

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