The specialists at the
New York Stock Exchange
are beginning to feel the squeeze.
Just weeks after the Big Board rolled out its new hybrid market--which combines an electronic-trading platform with traditional auction-style floor trading--the exchange is closing some of its trading rooms. The NYSE announced Tuesday that it is moving to close one of its five trading rooms over the next 18 months.
The NYSE says that "technology-driven productivity gains" in recent years have enabled the consolidation.
The change will affect trade specialist firm,
Bear Wagner Specialists
and 33 floor brokerage firms that are housed at the NYSE leased-facility at 30 Broad Street in lower Manhattan. The firms will be relocated to other NYSE properties.
Other than its main Wall Street location, NYSE will have office space in just one other facility, after the close of the 30 Broad facility.
NYSE says the consolidation will not be disruptive to customers or floor brokers.
"We expect that this effort will produce cost savings and further increase efficiencies for both the floor firms and the exchange," the company says.
Analysts and market observers have been predicting the NYSE's hybrid market would further eat into the profit margin of specialist firms such as,
Van Der Moolen
. The specialists historically have driven trading on the NYSE. But over time, they have lost market share to more cost-efficient electronic trading platforms.