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Instinet Incorporated history
Instinet Incorporated company history timeline
The challenge was to create something special that reflected Instinet’s pioneering spirit — something that was just as original and daring as the company that had invented electronic trading in 1969.
Through this Instinet system, which was operating by 1970, the company provided computer services and a communications network for the automated buying and selling of equity securities on an anonymous, confidential basis.
1981: Institutional Networks is profitable for the first time.
An Institutional Networks subsidiary, INC Trading Corp., was, in 1983, a member of the Boston, Cincinnati, and Pacific stock exchanges and was also a member of the National Association of Securities Dealers, the operator of NASDAQ.
In 1983 William Lupien, who succeeded Pustilnik as president, and some partners invested $5 million in the company in return for slightly more than 20 percent of the stock.
By the fall of 1984 the Instinet system was carrying bids and offers on 3,500 stocks on every exchange in the United States, and by the following spring it was connecting some 500 broker-dealers--including 19 of the 20 largest--specialists, and financial institutions.
In 1984 four big United States brokerage houses purchased 14 percent of Institutional Networks for $11.2 million, including warrants to buy another 11 percent of the company.
Institutional Networks was renamed Instinet in 1985.
One company that saw a bright future for Instinet was the British news-gathering agency Reuters, which in 1985 had negotiated an agreement to offer in all countries outside North America Instinet's automated trading system for United States equities, American Depositary Receipts, and options.
In November 1986 Reuters Holdings PLC announced it would seek to buy all Instinet shares it did not already own, an offer valued at $102 million.
Lupien resigned as chairman and chief executive officer shortly before the end of 1987.
1987: Instinet becomes a subsidiary of Reuters Holdings PLC .
A member of the International Stock Exchange, Instinet UK catered to British market makers and institutional investors and, in May 1990, added selected leading European stocks to its trading network.
By 1990 the Instinet network was beginning to make an impact on trading in Europe.
In 1991 Instinet introduced Market Match, a new electronic equities trading system that used a volume-weighted-average system.
Instinet bought members of the Paris, Frankfurt, and Zurich stock exchanges in 1993, and also acquired Thamesway, a broker with sizeable operations in Asia.
Furthermore, Instinet had a bottom-line advantage; a 1994 survey found Instinet to be the cheapest means of executing trades.
The firm's international initiative was given a boost in 1995, when a London Stock Exchange regulation was loosened, granting the ECN access to that market.
1995: Instinet trades make up 18 percent of NASDAQ's volume.
Horowitz, Jed. "Nasdaq Dealers Push for ECN Status Under New Rules." Investment Dealers Digest, March 31, 1997.
In 1997, the United States Securities and Exchange Commission (SEC) made changes to the order handling rules for stockbrokers, opening the door for new competition to Instinet, by then the largest electronic broker in the world.
Fears that Instinet was losing its long-secure market led to a sudden 15 percent drop in Reuters stock in October 1999.
United States equities accounted for nearly 80 percent of total revenue in 1999, but international revenue grew by 39 percent.
Celarier, Ian S. "The ECN Dilemma: Blasting Fragmentation, Wall Street Calls for a Centralized Market Structure That Threatens the Upstarts." Investment Dealers Digest, March 6, 2000.
Weinberg, Neil. "Darwinism On Wall Street." Forbes, November 13, 2000.
In 2000, parent company Reuters Group PLC announced its intent to spin off Instinet as a publicly traded company.
Lacey, Stephen. "Instinet Instigates ECN IPO Battle." Red Herring, February 12, 2001.
Ceron, Gaston F. "Tales of the Tape: ECNs Face a Fork in the Road." Dow Jones News Service, March 8, 2001.
Instinet Group LLC. "Corporate Information: History." New York: Instinet Group LLC, 2001.
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Instinet Incorporated competitors
| Company name | Founded date | Revenue | Employee size | Job openings |
|---|---|---|---|---|
| Gain Capital Holdings | 1999 | $742.8M | 801 | - |
| Morgan Stanley | 1935 | $3.0B | 68,097 | 1,096 |
| Warburg Pincus | 1966 | $2.1B | 500 | 1 |
| CME Group | 1848 | $6.1B | 4,500 | 38 |
| The Vanguard Group | 1975 | $6.9B | 17,600 | 247 |
| Stifel Financial | 1890 | $49.8M | 7,100 | 148 |
| Charles Schwab | 1971 | $1.6B | 32,000 | 661 |
| HarbourVest | 1982 | $12.8M | 341 | 6 |
| Prudential Retirement Insurance And Annuity Co | - | $57 | 41,671 | - |
| BNY Mellon | 2007 | $16.4B | 48,400 | 1,108 |
Instinet Incorporated history FAQs
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Instinet Incorporated may also be known as or be related to Instinet, Instinet Incorporated and Instinet LLC.