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[June 08, 2004]

Instinet to Expand Block Trading Platform with Launch of Intra-Day Cross

NEW YORK --(Business Wire)-- June 8, 2004 -- Instinet, LLC today announced the expansion of its suite of electronic U.S. equity block trading services with the addition of the Intra-Day Cross (IDX). Scheduled to launch Wednesday, June 9, IDX was designed to counter the industry trend toward smaller execution size, and give institutional investors the opportunity to anonymously and cost efficiently trade large blocks of U.S. stock, or illiquid U.S. securities, without human intervention and without an effect on price. IDX will join the company's other institutional block trading services: Volume-Weighted Average Price (VWAP) Cross, Continuous Block Crossing (CBX(SM)), End-of-Day Cross (EDX), ProActive SmartRouter(SM) and sales trading desks in North America, Europe and Asia.


"Institutional investors have told us for years that they have had difficulty finding the large pools of liquidity that make block trading cost efficient. We believe that our comprehensive block solution can deliver this liquidity and help institutions realize the benefits of trading large size anonymously," said Mike Plunkett, President, North America, Instinet, LLC. "Designed to leverage our client base of more than 1,000 institutions, Instinet's trading systems will accommodate buy-side investors as they begin to trade more blocks electronically."

According to the April 2004 report by The Tabb Group titled "Institutional Equity Trading in America: A Buy-side Perspective", finding liquidity in today's market has become increasingly difficult, as the average trade size has declined from over 1,400 shares per trade in 1997 to approximately 500 shares per trade. In the meantime, share volume has increased by over 330%, driving up the number of trades more than 1,100%. Furthermore, the report points out that although smaller trade size reduces market impact, buy-side traders find that it creates difficulties in finding the large blocks of liquidity that crossing systems can provide.

Instinet's block trading services bring together a broad range of institutional participants from around the world, including mutual funds, hedge funds, plan sponsors and other institutions. Based on Instinet's proprietary technology platforms, such as Newport(TM), components of the company's block trading solution include:

-- IDX - allows clients to anonymously participate in any of the three crossing executions that take place each day, and access this diverse liquidity pool without anyone seeing their order flow. This eliminates the market impact that occurs in auction markets, often a significant contributor to transaction costs.

-- VWAP Cross - operates before the market opens, where trades are matched on a volume-weighted average price for that day. The effect of volatile market swings is reduced, global liquidity from Europe and Asia is easily accessible and the client receives low market impact from confidential orders and non-negotiable prices. The VWAP benchmark is an internationally recognized average of all trades weighted by volume in any given stock.

-- CBX - is designed to help Instinet's clients trade large orders by interacting with their natural counterparty - a trading partner with similar investment principles but a different outlook on a stock's performance. There are minimum order size, trade size and display size requirements for participation in CBX.

-- EDX - provides clients with the opportunity to participate in an overnight match at the markets' closing prices for that day. All end-of-day crossing trades are booked at the following day's trade date, and timing has been selected specifically to maximize customer participation and concentrate liquidity.

-- ProActive SmartRouter - adds value by simultaneously routing orders during market hours to internal or external marketplaces, such as CBX, INET, ArcaEX, SuperMontage and the exchanges, to increase the likelihood of price and size improvement. Meanwhile, Instinet's sales trading desks in New York, Boston, London, Tokyo, Hong Kong and Toronto assist in representing and protecting institutional clients' orders, finding liquidity in international markets, and helping to formulate trading strategy.

About Instinet, the Institutional Broker

Instinet, the Institutional Broker, gives its customers the opportunity to use its sales-trading expertise and advanced technology tools to interact with global securities markets, improve trading and investment performance and lower overall trading costs. Through Instinet's electronic platforms, customers can access other U.S. trading venues, including NASDAQ and the NYSE, and almost 30 securities markets throughout the world. Instinet acts solely as an agent for its customers, including institutional investors, such as mutual funds, pension funds, insurance companies and hedge funds. Instinet, LLC is a subsidiary of Instinet Group Incorporated (NASDAQ:INGP) which is part of the Reuters family of companies.

(C)2004 Instinet, LLC. All rights reserved. INSTINET and INET are registered service marks in the United States. Instinet, LLC, (branded Instinet, The Institutional Broker), member NASD/SIPC and Inet ATS, Inc. (branded INET), member NASD/SIPC are subsidiaries of Instinet Group Incorporated which is part of the Reuters family of companies.

This document is for informational purposes only and does not constitute an offer, solicitation or recommendation with respect to the purchase or sale of any security. While Instinet believes the information contained herein is reliable, we do not guarantee its accuracy, and it may be incomplete or condensed. Instinet undertakes no obligation to update publicly any of the information contained herein, in light of new information or future events.

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