Trading Floor Is a 'Real-Time Lever,' Says NYX CEO Duncan Niederauer

By: Ray Pellecchia

File Under: NYSE, NYSE Arca

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Steve Forbes has just posted a compilation of excerpts from the 50 interviews with financial leaders he's done in the first year of his Intelligent Investing series. Here's the piece he pulled from his talk with NYSE Euronext CEO Duncan Niederauer:

Forbes: You think your firm now has some trading efficiencies which are highly important. Can you quickly enumerate some of them?

Duncan Niederauer (NYSE Euronext CEO): I think what's unique is the market model that's different. I think we have an ability, I view it as a real-time lever, where we've got a floor, we can intervene human judgment, and no other all-electronic marketplace can. Even our own all-electronic marketplace. We run the NYSE Arca platform that's all electronic to compete with the other all-electronic markets like Nasdaq, like Direct Edge, like BATS.

We're going to keep the floor at the NYSE, because we think what makes it unique is you look at a period like September and October, volatility explodes, clients wanted to trade blocks of stock, not 500 or 1,000 shares at a time. We were the only market that was effectively positioned to do that at any time during the day. So I think that makes it fairly unique. At the same time, we had to get fast enough to be competitive with the rest of the marketplaces. So when I got there with some of my key lieutenants, one of the things we embarked on was an 18 to 24 month redo of the technology, so that our technology is now as fast as everyone else, just about, when we need it to be. But then we have that ability to intervene human judgment, real time, if we have to, too.

Hope you're having a marvelous Monday. On the trivia front: Elmer Sperry was born on this day in 1860 (died 1930); here's the New York Times obituary on his remarkable life. Excerpt:

More than fifty years of Mr. Sperry's life had been devoted to invention. At his death, he was said to have taken out nearly 400 patents, about double the number taken out by Edison.

He is best known for his utilization of the gyroscope for the stabilization of ships, airplanes and aerial torpedoes. Only about two months ago [as of June 1930] a giant army bombing plane, equipped with two Sperry gyroscopes serving as automatic pilots, flew from Sacramento to San Francisco without the guidance of human hands.

He also invented the gyro compass, which eliminated the variations due to the earth's magnetism. Next he invented " metal mike," the automatic steersman, which keeps a ship on a set course. Next he used it to stabilize ships and to keep them on an even keel in all kinds of weather. Later, he applied the gyroscope to airplanes, with devices to give fliers artificial horizons, enabling them to fly "blind" in dense fogs.

In addition, he invented new systems of street lighting, new machinery for mining, electric devices for trolley cars, an electric automobile, a lighting system for motion picture projection, an electric arc light, a high-power searchlight and electrochemical processes.