Looking to become a true portal to European equities exchanges, NeoNet Securities is planning to become a member of the London Stock Exchange and EuroNext.
By the end of the year, the brokerage will be able to afford its institutional clients access to nearly 80% of all European equities, up from its current 25%. The company, which only entered the U.S. market last year, is answering to the requests of its American and European clients, which have asked for more access, says Torvald Bohlin, president and CEO.
"I would say the addition of London and EuroNext is important to all of our clients, in the U.S. and in Europe," Bohlin explains. "If you look at our business, we have proposed to offer a truly, pan-European product, to be an exchange portal for major institutions and broker-dealers. Of course, I would say this is very much an American, or U.S., client focus, because our growing client base in the U.S. is very important."
NeoNet currently counts more than 130 institutions and broker/dealers as clients. About 15% of that is based in the U.S., a surprising figure for a company that only entered the market last year.
With the addition of the LSE and EuroNext-which affords access to the Paris, Amsterdam and Brussels exchanges-clients will now have access to about 80% of European equities through NeoNet's NeoTrade products. NeoTrade is comprised of both a desktop client and server application built atop an Oracle and Windows NT architecture. Rather than rely on the public Internet, users connect to NeoNet via leased, fiber-optic lines.
Bohlin points out that the firm is considering moving away from the dedicated lines to a VPN (virtual private network) that should save both the firm and its clients money. "Currently, we use dedicated lines for capacity and security reasons," he says. "I think you'll see a lot happening in the field of technology with the NeoTrade system in only a short period of time. We are focused on maintaining our system solutions to be on the forefront and also on listening to the needs of our clients for system development. We want to keep the system user friendly and fast."
The firm expects to have its interface to the LSE completed by the end of the third quarter, and the interface to EuroNext completed by the beginning of next year.
NeoNet was founded only in 1996 as a discount brokerage for Swedish clients. After expanding its offering to the entire Scandinavian community, it shifted gears in 1998 to become an institutional brokerage for investors interested in European securities.