[ by Melanie Gretchen ] We're one month into the new year, and yet it's "same old, same old" for many small broker-dealers.  Despite the Dow being up nearly 6% year-to-date, 3 small firms unraveled and closed, while hundreds of others are on the proverbial "death watch."  2012 does not appear to be "The Year of the Small." Small Brokerage Firms. The collapse of WJB Capital Group, Ticonderoga Securities, and Kaufman Brothers have created a crisis in confidence among small boutique trading firms.  Most generate revenues from trade commissions and from providing proprietary research reports to clients.  Yet, trading volume and commission revenue are at their lowest levels since 2007. And, adding 'insult to injury', when particular firms become the target of rumors that they're having potential troubles, investors often stop sending orders to them and take more time to pay for the research.  It's as if these clients - many of which are buy side firms - take a wait-and-see attitude, and start to think, "why would I give my commissions dollars to a firm that might not be here in three months?" according to Concept Capital CEO Robert Moore. When Size Matters. With trading revenues down about 20% on the Street, the larger firms have the ability to make up the loss in other ways - unlike the boutique firms, which are effectively "one trick ponies." Wall Street is Shrinking. The closure of these 3 firms may benefit some small and midsize brokerage firms like Raymond James, Sterne Agee, and Stifel Financial.  But the impact of a shrinking Wall Street can be problematic.  Will Wall Street find an equilibrium between traders and brokerages?  How long will volumes remain depressed?  And will investors gain confidence in the market, move back into stocks and begin to trade more?

Only time will tell - hopefully, these boutique firms can stick it out and share in the good times.

For more details, go to [CNNMoney, 2/8/12].