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ECN (1)

Electronic Communications Network. Defined under Rule 11Ac1- 1(a)(8) under the U.S. Securities Exchange Act of 1934.

ECN (2)

Electronic Communication Network

A computer system that facilitates over-the-counter trading as well as exchange trading. The electronic communication network sends buy or sell orders to the appropriate specialist on the floor of a stock exchange, bypassing the floor broker. A company running an ECN charges a fee for its services.


Electronic communications network (ECN).

An ECN is an alternative securities trading system that collects, displays, and executes orders electronically without a middleman, such as a specialist or market maker.

Trading on an ECN allows institutional and individual investors to buy and sell anonymously. Further, ECNs facilitate extended, or after-hours, trading.

ECN trade execution can be faster and less expensive than trades handled through screen-based or traditional markets, though the volume is sometimes thin.

However, some ECNs have been approved for official stock exchange status, expanding the number of stocks that can be traded on their systems.

References in periodicals archive ?
It began with ECNs, but is rapidly moving beyond them to a new frontier.
They punished the collusion by broadening public access to the market, and opened the door to new ECNs.
ECNs should theoretically aggregate the postings of all participating market-makers, perhaps on a consolidated basis in the near future.
It is one of the four original ECNs approved in January 1997 by the SEC.
ColorBook integrates the full depth of order books from ECNs, exchanges and other liquidity sources into a premium, high-performance, real-time data feed.
Adds Robert Iati, research director for Securities and Capital Markets at TowerGroup, "Combining two of the largest, and more technologically-advanced and open ECNs will certainly go a long way toward building an accessible, concentrated liquidity pool-something institutional and individual investors have been seeking," he said.
and to extend the network through partnership arrangements with third party distributors including software and application providers, ECNs and exchanges.
The announcement means that three of the largest ECNs in the country -- Island ECN, Archipelago, and REDIBook -- now participate in 3DStockChart's 'virtual' limit order book.
Interestingly, as the NASDAQ Composite fell and liquidity began to dry up in early April, the ECNs began to account for more of NASDAQ trading, suggesting that NASDAQ investors have been more successful finding liquidity in the ECNs in the less active periods.
ECNs, brokerage firms and financial institutions means that MidasTrade GDAN is now truly a two way network providing both incoming and outgoing orders between Korea and the U.
ECNs, or Electronic Communications Networks, operate as Internet-based alternatives to the established NYSE and Nasdaq exchanges.