BATS Global Markets
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BATS Global Markets
| BATS Exchange, Inc | |
|---|---|
| Type | Stock exchange |
| Location | Lenexa, Kansas, United States |
| Founded | June 2005 |
| Owner | BATS Holdings Inc., |
| Key people | Joe Ratterman Chairman, President and (CEO) |
| Currency | United States dollar |
| Volume | 1B shares (Jan 2009) |
| Indexes | NASDAQ: BATS (withdrawn) |
| Website | www.batstrading.com |
BATS Global Markets is a stock exchange based in Lenexa, Kansas, a suburb of Kansas City. BATS was founded in June 2005 as an Electronic Communication Network (ECN) and its name stands for Better Alternative Trading System.[1]
BATS operates two stock exchanges in the U.S., the BZX Exchange and the BYX Exchange (The BATS Exchanges), which currently account for about 10-12% of all U.S. equity trading on a daily basis (BZX and BYX are different chiefly because of their pricing structure and the BZX is almost 4X bigger than than the BYX[2]). It is the third largest stock exchange in the United States.[3]
The company was founded by computer programmer and entrepreneur David Cummings who had worked at Kansas City institutions Cerner and Kansas City Board of Trade before developing the computer trading program tradebot which became the core of BATS which was originally located near his home in the Briarcliff Village neighborhood in Kansas City, North. He said he was inspired to start the company after seeing Archipelago Holdings being acquired by the New York Stock Exchange and Instinet Group acquired by NASDAQ within a week of each other in 2005. Tradebot initially only traded its own money but with the launch of BATS other brokerages, hedge funds and other clients were involved. He publicized his company by sending emails to the companies pointing out the niche that could be carved out by trading on platforms other than the big two.[4] The company originally had 13 employees.[5]
The niche that he sought for the company was for it to be a "a neutral, private, broker-dealer owned, semi-profitable utility" with no party owning more than 20 percent.[6] He noted that the consolidation of the New York Stock Exchange and NASDAQ eliminated competition and they raised prices for their services. The BATS system was intended to charge less.[7] Among the items it did to draw customers was to offer free listings to companies with shares that traded a certain amount each day[8]
Cummings stepped down in 2007 and was replaced by Joe Ratterman who had been associated with the company from the start. Cummings said in his resignation "As BATS prepares to become an exchange, my ownership of a broker-dealer precludes me from serving in management." Cummings returned to his position as CEO at Tradebot.[6][5]
The company went public on March 23, 2012 on NASDAQ, but later withdrew the IPO the same day due to a disastrous glitch in the company's trading systems which resulted in stocks on the NASDAQ with A or B ticker symbols, including Apple, Inc., to plunge deeply to the point of a trading halt due to BATS system errors, and BATS's stock to fall far from the original $16 offering price to as low as 4¢ a share.[9][10][11]
References
- ^ "Capitalists of the Prairie", Newsweek, 2008-09-12, http://www.newsweek.com/2008/09/11/capitalists-of-the-prairie.html
- ^ http://www.batstrading.com/
- ^ McLaughlin, Tim (2012-03-23). "BATS' core business solid, future growth uncertain". Reuters. http://www.reuters.com/article/2012/03/26/us-bats-outlook-idUSBRE82P16T20120326. Retrieved 2012-03-27.
- ^ "BATS Trading CEO Cummings likes being the catalyst - Kansas City Business Journal". Bizjournals.com. http://www.bizjournals.com/kansascity/stories/2006/12/18/story14.html?page=2. Retrieved 2012-03-27.
- ^ a b Spicer, Jonathan. "BATS founder pushes for IPO despite "freak" glitch - Yahoo! News". News.yahoo.com. http://news.yahoo.com/bats-founder-pushes-ipo-despite-freak-glitch-175735456.html. Retrieved 2012-03-27.
- ^ a b Massaro, Kerry (2007-06-29). "Dave Cummings Steps Down As BATS CEO/Prez". Advanced Trading. http://www.advancedtrading.com/blog/archives/2007/06/dave_cummings_s.html. Retrieved 2012-03-27.
- ^ Grant, Justin. "Dave Cummings: Market Maker". Advanced Trading. http://www.advancedtrading.com/top-innovators/2011/Dave-Cummings. Retrieved 2012-03-27.
- ^ "BATS founder says exchange should renew IPO in 2Q". CBS News. http://www.cbsnews.com/8301-505245_162-57404185/bats-founder-says-exchange-should-renew-ipo-in-2q/. Retrieved 2012-03-27.
- ^ Olivia Oran, Jonathan Spicer, Chuck Mikolajczak and Carrick Mollenkamp (23 March 2012). "BATS exchange withdraws IPO after stumbles". Reuters. http://www.reuters.com/article/2012/03/24/us-bats-trading-idUSBRE82M0W020120324. Retrieved 24 March 2012.
- ^ Bremner, Brian (23 March 2012). "The Bats Affair: When Machines Humiliate Their Masters". Bloomberg Businessweek. http://www.businessweek.com/articles/2012-03-23/the-bats-affair-when-machines-humiliate-their-masters. Retrieved 24 March 2012.
- ^ Rooney, Ben (23 March 2012). "BATS Global Market shares are halted after IPO - BATS: Well, this is awkward". CNN (CNNMoney.com). http://money.cnn.com/2012/03/23/markets/bats-ipo/index.htm. Retrieved 24 March 2012.
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