New York – In a move said to be aimed at providing more competition for New York- based stock exchanges, four major financial-services firms and the Boston Stock Exchange announced plans Wednesday to launch an electronic stock market.
The firms forming a joint venture to build the new exchange include the brokerage arm of Fidelity Investments.
Executives of another Fidelity unit, which handles trading for Fidelity mutual funds, have criticized the New York Stock Exchange for what they have called “outdated monopolistic trading rules” favoring NYSE members over investors.
Steve Austin, a Fidelity spokesman, said there’s no connection between the criticism and Wednesday’s announcement. He said the brokerage unit made the decision to invest in the Boston exchange and that the mutual-fund unit was “not involved.”
In a joint release with the Boston exchange, Mark Haggerty, executive vice president of Fidelity Brokerage Co., said creation of the electronic exchange will “provide greater choice in competition among markets, which is vital to keeping trading costs low and ensuring quality executions.”
The other partners in the deal are the Manhattan-based investment banks Citigroup, Lehman Brothers and Credit Suisse First Boston.
Wednesday’s announcement came about a week after four Wall Street firms announced plans to buy a combined 25 percent share in the Philadelphia Stock Exchange.
