DITnet News TAIB BANK LAUNCHES NEW ONLINE TRADING SERVICE AT COMDEX SAUDI ARABIA BAHRAIN-BASED TAIB BANK HAVE USED COMDEX SAUDI ARABIA TO LAUNCH A NEW ONLINE TRADING SERVICE, USDIRECT. BY DITnet STAFF Jeddah, Saudi Arabia April 11, 2000 At the moment there are three ways that Middle East individuals can play US markets from the Middle East: using a bank, using a broker or using online trading sites such as those from Schwab and ETrade. USDIRECT is a fourth option that has been launched at COMDEX Saudi, and will go live in two weeks time. Subscribers to the service get software that resides on the user's PC. This software provides Level 2 access to the NASDAQ, NYSE, and AMEX markets. It is the only solution in the Middle East to do this says Farid Samji, Assistant Manager at TAIB Bank. He cites this as one of the killer reasons why Middle East traders should use the service. Level Two access gives the user access to both the bid and ask price for any listed stock from all of the Market Makers on the show floor. An online site or a banking service will only give Level One access - it will detail one ask and one bid price. "The main advantage of this service over an online site is that while a bid may cost only $10 for a trade, an online service gets 2-3 cents from the market maker for passing on that deal. The market maker is able to pay the online service this fee because he makes around 12 cents on the spread [the spread is the difference between the bid and the ask price]. This spread may not even be the best price available-it will come from that particular broker's books. With USDIRECT you choose your own market maker and you see all of their ask and bid prices. As a consequence you get the best spread." "Against banks in the region not only are our prices lower for making a transaction, but with many of the banks here it's not you who owns your shares. The bank will have a pool account from which it does its trading and the shares will belong to them. It will only be in the local accounting books that they will divide up their portfolio to users of their service." Users of the service also get access to Electronic Networks (ECNs) like Island, Reuters and Archipelago which are now beginning to rival the stock exchanges themselves. The idea behind ECNs is that the large traders exchange between themselves, on their own network. The service is still regulated by the SSE. Another advantage of the ECNs is that they open half an hour before the stock market opens and close half an hour afterwards, giving the trader an opportunity to either buy or sell before trading begins on the stock markets themselves. "We have had an overwhelming level of interest at COMDEX Saudi-phenomenal actually. We've had interest not just from traders but also from three Middle East banks who can also see the massive benefits of the system. It's going to be an exciting next twelve months for us, that's a fact." Copyright (c) 1997-99 Dabbagh Information Technology Group. All rights reserved.