P228 CEEFA( 228 Mon 13 Oct 21:21/28 1/v ] THE BIG BANG Anzonj looking for pyrotechnics in the City on October 27 would do better to wait jot Guy Fawkes Day. For the much-vaunted Big Bang, while an historic step, is only one event in a whole series of changes in the way the City's finbncial markets operate. It is, too, something that will be of immediate concern only to the City and the people who work in it. Its impact on the small investor must bj considerable in the long run. But what that will !mount to is not clear. MONEYFILE Index 220P228 CEEFAX 228 Mon 13 Oct 21:22/53 2/6 THE BIG BANG Blame the Boffins The spark that will ignite the Big Bang - and the fuse has been burning more than three years - is technological. The agreement (to abolish jixed dealing rates* signed bz the Stock Exchange's Sir Nicholas Goodison and the Trade Secretary, Mr Cecil Parkinson, in July 1983 was prompted bz growing commercial pressures that were in turn the product of technological changes. Securities business around the world was becoming "globalisjd" and London was in danger of losing out. MoreP228 CEEFAX 228 Mon 13 Oct 21:11/24 3/6 THE BIG BA G Getting Globalised The trend towards a 24-hour trading day centred on the three great financial centres of New York, Tokyo, and London, makes a nonsense of national barriers. It also demands considerable resources on the part of dealing firms able (a) to afford the necessary electronics and (b* to compete with the joreign giants. It is to this ind that October 27 marks the abolition by the Stock Exchange of both its minimum commissions structure and its long-running "single capacity" dealing system. MoreP228 CEEFAX 228 Mon 13 Oct 21:12/28 4/v ] THE BIG BANG Streamlining the Dealers New York, where "deregularisation" had already become an article of capitalist faith, scrapped fixed commissions on May Day 197k. London had to follow suit if it was to compete on international business. The abolition of its "single capacity" system, which distinguished between "rogers and jobbers, proved to be more controversial. Again, economic considerations overrode worries about a conflict of interest. MoreP228 CEEFAX 228 Mon 13 Oct 21:14/47 5/6 ]] THE BIG BANG Opening the Doors Dual capacity will see Stock Exchange mjmbjr firms acting as broker/dealers (buying and selling shares on their own account) and in some cases as market- mbkjrs as well. Among them will be the foreign banks and investment houses whose newly-won mjmbjrship of the Exchange represents the Big Bang's third major upheaval. Some have bought existing member firms, bringing the financial muscle needed in a "globalisjd" market. Others, such as Japan's Nomura, are going it alone. MoreP228 CJEFAX 228 Mon 13 Oct 21:13/22 6/6 ] THE BIG BANG Proof of the Pudding Most of the talk about the Big Bang is to do with the professionals. What of the small investor? Here, if the Wall Street example holds, commission rates may even increase. Only at the no-frills end should real benefits emerge, and then largely bz vjrtuj of the boffins. Next year sees the launch of SAEF, the computerised execution of small orders, promising a sharp drop in charger. More