Island Ecn - How Island Works, The Emergence Of Island, Measuring Up To Competition

Island ECN has played a key role in redefining how stocks and other securities are traded. Island is an electronic marketplace that enables market professionals to display limit orders for stocks and other securities, directly matching buyers and sellers, and in doing so eliminating many of the traditional stock market middlemen and their fees. Thousands of market participants enter over 2 billion shares into Island every trading day, averaging over 400 million shares traded on a daily basis.

As an Electronic Communication Network (ECN), Island is part of the NASDAQ. The NASDAQ functions as a collection of marketplaces, offering a quotation service, whch lists the best price for the stocks traded, and connectivity services that enable participants to interact with each other. The NASDAQ, however, does not offer trading services. Therefore market professionals must ensure that their orders for NASDAQ securities are posted in a marketplace that offers best liquidity, that is, the best chances of getting an execution quickly at low-cost. Island ECN proved that it could meet all these needs. In 2001 Island was the second largest ECN, after Instinet Inc.