Instinet
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| Industry | Brokerage |
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| Founded | 1967 |
| Headquarters | New York, NY , United States |
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Key people
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Jonathan Kellner, CEO Frank Freitas, COO Jonathan Kellner, Regional Head - Americas Shaun Bramham, Regional Head - Asia-Pacific Richard Parsons, Regional Head - EMEA |
| Parent | Nomura Holdings |
| Website | http://www.instinet.com |
Instinet is an institutional, agency-only broker that also serves as the independent equity trading arm of its parent, Nomura Group. It executes trades for asset management firms, hedge funds, insurance companies, mutual funds and pension funds. Headquartered in New York, the company provides sales trading services and trading technologies such as the Newport EMS, algorithms, trade cost analytics, commission management, independent research and dark pools of liquidity.
Instinet is best known as one of the first off-exchange trading alternatives, with its “green screen” terminals prevalent in the 1980s and 1990s, and, more recently, as the founder of Chi-X Europe and Chi-X Global.
According to industry research group Markit, in 2015 Instinet was the 3rd largest Cash Equities broker in Europe.
Instinet was founded by Jerome M. Pustilnik and Herbert R. Behrens and was incorporated in 1967 as Institutional Networks Corp. The founders aimed to compete with the by means of computer links between major institutions, such as banks, mutual funds, and insurance companies, with no delays or intervening specialists. Through the Instinet system, which went live in December 1969, the company provided computer services and a communications network for the automated buying and selling of equity securities on an anonymous, confidential basis.
Uptake of the platform was slow through the 1970s, and in 1983 Instinet turned to William A. "Bill" Lupien, a former specialist, to run the company. Lupien decided to market the system more aggressively to the broker community, rather than focus exclusively on the buyside as his predecessors had. To expand its market, Lupien brought on board Fredric W. Rittereiser, formerly of Troster Singer and the Sherwood Group, as President and Chief Operating Officer and David N. Rosensaft as Vice President (later SVP) of New Products Development. Together, they successfully introduced many innovations which made Instinet an integral tool for traders on both the "buy" and "sell" sides of the market.
As a result of Lupien’s refocusing of Instinet (which the business was renamed in 1985), the firm grew rapidly in the mid-1980s. During the Crash of 1987 electronic trading system allowed trading when brokers and market makers were unwilling to answer their phones during the free-fall.Reuters, which in 1985 had acquired a portion of the firm, acquired the entire business in May 1987, though under the deal Instinet would remain an independent, New York-based subsidiary. Lupien and then COO Murray Finebaum would resign shortly thereafter.
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