They just have to hunker down and reduce expenses so they can benefit from increased trades.

It's certainly something they can do and there are savings involved, but the extent of the savings is the longer-term question because I'm not sure whether you can trade everything on one platform.

This could be the first signs of the effects of increased competition in the sector. Every major online broker has increased its ad spending, with new online offerings and advertising by full-service brokers as well.

This deal makes a lot of strategic sense. It combines complimentary liquidity pools.

A couple of things made a marked difference for Nasdaq this year. They completed a secondary offering early in the year, which gave visibility to their cost-cutting and market-share gains. The strong performance of exchange stocks later in the year also helped lift Nasdaq. Finally, there's revenue growth, and the potential to take listed share next year as the New York Stock Exchange goes automated.

Schwab is dealing with lots of issues. They still haven't fully integrated U.S. Trust.

Schwab is trying to shore up their capital markets and expand revenues.

While there are many areas where we think the company can/needs to continue to improve upon, still it is obvious from nearly every client metric, customers are responding to 'Chuck' in a compelling fashion...and we think the client is likely the most important aspect of a retail business.

While we fully expected the stocks to rebound well before their fundamentals, we believe the scenario has now reversed to a potential overbought scenario.

Valuations have gotten relatively lofty in all six publicly traded exchanges. Nasdaq is the best buy of the six. It's a cost-cutting story. The opportunity to take share should extend through 2006 and 2007.