Instinet

Instinet (Institutional Networks Corporation)

Computerized subscriber service that serves as a vehicle for the fourth market. "Instinet" is registered with the SEC. As a stock exchange it numbers among its subscribers a large number of mutual funds and other institutional investors linked to each other by computer terminals. The system permits subscribers to display bids and offers (which are exposed system wide for whatever length of time the initiating party specifies) and to consummate trades electronically. Instinet is largely used by market makers, but, nonmarket makers and customers have equal access.

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Instinet. Instinet is the world's largest agency brokerage firm.

As an agency firm, it doesn't trade stock for its own account as traditional brokerage houses do. That way, it doesn't bid against the mutual funds, insurance companies, pension funds, and other institutional investors who are its primary clients.

Using Instinet's sophisticated electronic network, these investors can trade directly and anonymously with each other in more than 40 global markets. Or, using Instinet brokers, the investors can place orders on all US exchanges and many overseas exchanges, including those that aren't automated.