A: SBX was created to provide a visible marketplace for small, unlisted companies.

SBX also makes a market for other securities without a marketplace, such as call options, delayed delivery, minor foreign currencies, and after-hours trading of listed stocks. Modern technology makes 24-hour trading possible.

We believe SBX thrives because we are directing our effort to niche markets and under-serviced areas of interest to individual investors. We do not compete with the brokers.

A: Institutional and retail investors need different services.

The industry has not automated the trading of unlisted securities. We use the term “unlisted” to include stocks, call options, municipal bonds, gold coins, currency, etc., that do not trade on an exchange or NASDAQ. The unlisted market is quite large. Offering 24-hour trading is necessary because of the pace of today’s economy.

A: SBX will operate 24 hours a day. 

A: Integrating the exchange, clearinghouse, and member-client accounting records on one electronic platform situated at one location makes 24-hour trading and same-day cash settlement (T+0) possible.

In contrast, the existing exchanges no longer own their own clearinghouses or depositories. The trading process takes three days from execution to settlement (T+3).

A: SBX Trader-ID feature provides free advertising to anyone that posts a bid or offering.

This unique service allows investors to negotiate the terms of a call option or other derivative, prior to entering the actual order.

We have more than 20 order types including Odd-lot, Prearranged-Cross, and hidden orders such as Fill-bids-only and Buy-offerings-only. The order types are designed for thin unlisted markets.

A: We believe that SBX offers the brokers interesting trading and arbitrage opportunities. We plan to make a version of our software available to the brokers.

A: We do not regard the larger exchanges as competitors, because we are providing trading facilities to niche markets and under-serviced areas of the business.

A: Our software is designed to provide reports to regulators.

SBX software integrates the Exchange and member-client trading records, we can supply detailed trading records presently unavailable from other systems. We can monitor accounts in real time as the transactions are made.

A: The SBX integrated platform is a cash settlement (T+0) system, where the trade and settlement of a transaction occur at the same time.

Using an integrated platform and cash settlement (T+0) is a more efficient way to process small orders than straight-through processing, which is a three-day settlement (T+3) system.

At SBX everything happens on the same day. For example, when a trade is made on e-Exchange, the transaction is reported directly to the investor, and the investor’s account status and general ledger account are all updated at the same time. The integration of the exchange, broker, clearinghouse, and depository functions creates substantial cost savings, which e-Exchange can pass on to investors in the form of lower fees.