updated 1/25/2007 11:08:32 AM ET 2007-01-25T16:08:32

The New York Stock Exchange on Wednesday completed the most crucial phase of its plan to have its 3,618 securities trade almost exclusively electronically, allowing the stock market to be more competitive with speedier service.

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The exchange added the final 105 stocks to its electronic trading system that has been rolled out in phases since October. Under the new operation, called the hybrid system, stocks will trade electronically most of the time, but can revert to a floor trader at the request of a client or during periods of volatility.

NYSE Group Inc., the exchange’s parent company, has implemented electronic trading to better compete with Nasdaq Stock Market Inc. Both have the ability to execute trades for companies listed on the rival exchange, and the Nasdaq has been taking a bigger market share during the past year.

Louis Pastina, an executive vice president at the NYSE in charge of the hybrid rollout, said customers now have “more choices in trading NYSE-listed securities.”

However, the jump into electronic trading has not been without radical change on the NYSE’s storied trading floor. With more stocks trading electronically, the need for floor-based traders and specialists has lessened.

In recent weeks, big brokerage firms have let floor brokers go and have told employees that further cuts — or transfers off the floor and into a back office — might need to take place.

Specialist firms have had the most dramatic cuts. These firms run the open-outcry auctions on the floor, matching buy and sell orders for customers of the stocks they oversee. They also use their firms’ money to buy shares when nobody else wants to buy and to sell shares from their own inventory when nobody else wants to sell.

LaBranche & Co. has reduced its staff on the trading floor to about 85 people, compared to the staff of 190 it had before electronic trading was unveiled. Bank of America Corp. is also in the midst of trimming its floor-based specialist unit.

On Tuesday, Van der Moolen Holdings NV said its U.S.-based specialist unit will slash about 30 percent of its work force, with expected cost savings of about $4.5 million a year. The brokerage could not immediately say the number of jobs to be cut.

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