Instinet

If we want to see the world’s largest land volcano, we go to Hawaii’s Big Island. If we want to see the world’s largest ball of twine, we go to Cawker City, Kansas. And if we want to see the world’s largest agency brokerage, we check out Instinet, because that’s what it is.

But Instinet is oh so much more than just an agency brokerage. It’s an electronic trading service that allows agents from all over the world to come together—virtually, at least—to make trades, read market analyses, and peruse research materials pertaining to more than 40 markets around the globe. It doesn’t trade on its own, meaning it has no vested interest in the securities it deals with; it just serves as a facilitator for trades instituted by agents and brokers.

Which brings us to our next point: Instinet isn’t like eTrade, where individual investors can try their hand at financial markets. Instinet is geared specifically toward what we call institutional investors: pension funds, mutual funds, hedge funds, insurance companies, and the like.