AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 3, 2007

                                                           REGISTRATION NO. 333-

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549





                                    FORM S-8
                          REGISTRATION STATEMENT UNDER
                           THE SECURITIES ACT OF 1933





                           HUDSON HOLDING CORPORATION
               (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)



                                    Delaware
            (STATE OR JURISDICTION OF INCORPORATION OR ORGANIZATION)

                                   20-3766053
                      (I.R.S. EMPLOYER IDENTIFICATION NO.)

                       111 Town Square Place, Suite 1500A
                          Jersey City, New Jersey 07310
                                 (201) 216-0100
               (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
        INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

                             2005 Stock Option Plan
                   2007 Long-Term Incentive Compensation Plan
                             (FULL TITLES OF PLANS)


                                Martin Cunningham
                       111 Town Square Place, Suite 1500A
                          Jersey City, New Jersey 07310
                                 (201) 216-0100
            (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
                   INCLUDING AREA CODE, OF AGENT FOR SERVICE)


                                   COPIES TO:

                              David Selengut, Esq.
                         Ellenoff Grossman & Schole LLP
                        370 Lexington Avenue, 19th Floor
                            New York, New York 10017
                                 (212) 370-1300
                               Fax: (212) 370-7889


<PAGE>

<TABLE>
<CAPTION>


                                                 CALCULATION OF REGISTRATION FEE

---------------------------------------------------------------------------------------------------------------------
                                                                      PROPOSED
                                                                      MAXIMUM    PROPOSED MAXIMUM
             TITLE OF EACH CLASS                                      OFFERING       AGGREGATE
                OF SECURITIES                     AMOUNT TO BE         PRICE         OFFERING          AMOUNT OF
              TO BE REGISTERED                    REGISTERED(1)     PER UNIT(2)        PRICE       REGISTRATION FEE
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
<S>                                               <C>                <C>             <C>                  <C>
common stock, par value $0.001 per share,        110,000 shares     $0.35(2)(a)     $38,500.00           $1.51
underlying options...........................
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     75,000 shares     $0.40(2)(a)     $30,000.00           $1.18
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    305,000 shares     $0.49(2)(a)     $149,450.00          $5.87
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    250,000 shares     $0.80(2)(a)     $200,000.00          $7.86
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    475,000 shares     $0.90(2)(a)     $427,500.00         $16.80
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    725,000 shares     $1.00(2)(a)     $725,000.00         $28.49
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     30,000 shares     $1.15(2)(a)     $34,500.00           $1.36
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     66,667 shares     $1.46(2)(a)     $97,333.82           $3.83
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share.....   9,963,333 shares    $0.28(2)(b)    $2,789,733.20        $109.64
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Total                                           12,000,000 shares       n/a        $4,492,017.02        $176.54
---------------------------------------------------------------------------------------------------------------------
</TABLE>





(1)  The aggregate amount of securities registered hereunder is 12,000,000
     shares of common stock issuable upon the exercise of options which may be
     granted or common stock otherwise grantable pursuant to our 2005 Stock
     Option Plan (2,000,000 shares of common stock authorized) and our 2007
     Long-Term Incentive Compensation Plan (10,000,000 shares of common stock
     authorized). Pursuant to Rule 416 promulgated under the Securities Act of
     1933, as amended, this Registration Statement covers such indeterminate
     additional shares of common stock to be offered or issued to prevent
     dilution as a result of future stock splits, stock dividends, or other
     similar transactions.

(2)  The offering price has been estimated solely for the purposes of the
     calculation of the registration fee. The offering price has been calculated
     in accordance with the manner described in paragraphs (h) and (c) of Rule
     457 in the following manner:

         (a)      to the extent the exercise price of the options for which the
                  underlying shares reoffered by this prospectus is known, the
                  offering price is based upon the applicable exercise price; or

         (b)      to the extent the exercise price of the options for which the
                  underlying shares, or the grant price of the shares, reoffered
                  by this prospectus is unknown, the offering price is based
                  upon the average of high and low prices reported by the OTC
                  Bulletin Board on November 27, 2007 a date within five (5)
                  business days prior to the date of the filing of this
                  registration statement.

                                       i

<PAGE>



                                EXPLANATORY NOTE

      This registration statement on Form S-8 of Hudson Holding Corporation
(this "Registration Statement") has been prepared in accordance with the
requirements of Form S-8 under the Securities Act of 1933, as amended (the
"Securities Act") to register up to 12,000,000 shares of our common stock, par
value $0.001 per share (the "Common Stock"), to be issued to participants in
each of our 2005 Stock Option Plan and our 2007 Long-Term Incentive Compensation
Plan (collectively, the "Plans").

      This Registration Statement includes the registration for reoffer and
resale of up to 9,963,333 shares of our Common Stock that may be acquired in the
future under this Registration Statement by participants in the Plans who are
our "affiliates" as such term is defined in Rule 405 under the Securities Act of
1933, which shares constitute "control securities" as such term is defined in
General Instruction C to Form S-8.

      The materials that follow Part I and precede Part II of this Registration
Statement constitute a reoffer prospectus. The reoffer prospectus filed as part
of this Registration Statement on Form S-8 has been prepared in accordance with
the requirements of Part I of Form S-3 and in accordance with General
Instruction C of Form S-8.

                                     PART I

              INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS

ITEM 1. PLAN INFORMATION.*

ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*

* Information required by Part I to be contained in the Section 10(a) Prospectus
is omitted from the Registration Statement in accordance with Rule 428 under the
Securities Act of 1933, as amended.


                                       ii

<PAGE>


REOFFER PROSPECTUS

                           HUDSON HOLDING CORPORATION

                                12,000,000 SHARES
                                  COMMON STOCK

      This prospectus is being used in connection with the offering from time to
time by certain selling stockholders of our company or their successors in
interest of shares of the common stock issued or to be issued, or which may be
acquired upon the exercise of stock options issued or to be issued, pursuant to
our 2005 Stock Option Plan and our 2007 Long-Term Incentive Compensation Plan,
which we refer to herein collectively as the Plans.

      The common stock may be sold from time to time by the selling stockholders
or by their pledgees, donees, transferees or other successors in interest. Such
sales may be made in the over-the-counter market or otherwise at prices and at
terms then prevailing or at prices related to the then current market price, or
in negotiated transactions. The common stock may be sold by one or more of the
following: (a) block trades in which the broker or dealer so engaged will
attempt to sell the shares as agent but may position and resell portions of the
block as principal to facilitate the transaction; (b) purchases by a broker or
dealer as principal and resale by such broker or dealer for its account pursuant
to this prospectus; (c) an exchange distribution in accordance with the rules of
such exchange; and (d) ordinary brokerage transactions and transactions in which
the broker solicits purchases. In effecting sales, brokers or dealers engaged by
the selling stockholders may arrange for other brokers or dealers to
participate. Brokers or dealers may receive commissions or discounts from
selling stockholders in amounts to be negotiated immediately prior to the sale.
Such brokers or dealers and any other participating brokers or dealers may be
deemed to be "underwriters" within the meaning of the Securities Act of 1933, as
amended, or the Act, in connection with such sales. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 may be
sold under Rule 144 rather than pursuant to this prospectus. We will not receive
any of the proceeds from the sale of these shares; however, we will receive
proceeds from the exercise of our options. There is no guarantee that our
options will be exercised, but any proceeds received therefrom will be used for
general corporate purposes. We will pay the expenses of preparing this
prospectus and the related registration statement.

      Our common stock is quoted on the Over the Counter Bulletin Board
("OTCBB") under the symbol "HDHL.OB". On November 27, 2007, the closing sales
price for the common stock on the OTCBB was $0.28 per share.

Our principal executive offices are located at 111 Town Square Place, Suite
1500A, Jersey City, New Jersey 07310; Attention: Marty Cunningham. Our telephone
number is (201) 216-0100


      AN INVESTMENT IN THE SHARES OF OUR COMMON STOCK BEING OFFERED BY THIS
PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD READ THE "RISK FACTORS"
SECTION BEGINNING ON PAGE 8 BEFORE YOU DECIDE TO PURCHASE ANY SHARES OF OUR
COMMON STOCK.

      NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

                THE DATE OF THIS PROSPECTUS IS DECEMBER 3, 2007.

                                      iii

<PAGE>



--------------------------------------------------------------------------------



                                TABLE OF CONTENTS


NOTE ON FORWARD LOOKING STATEMENTS.............................................1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................1
PROSPECTUS SUMMARY.............................................................2
THE OFFERING...................................................................7
RISK FACTORS...................................................................8
USE OF PROCEEDS...............................................................15
SELLING STOCKHOLDERS..........................................................15
PLAN OF DISTRIBUTION..........................................................17
LEGAL MATTERS.................................................................18
EXPERTS.......................................................................18
WHERE YOU CAN FIND MORE INFORMATION...........................................19
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
  FOR SECURITIES LAW VIOLATIONS...............................................19


      You should rely only upon the information contained in this prospectus and
the registration statement of which this prospectus is a part. We have not
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not making an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume the information
appearing in this prospectus is accurate only as of the date on the front cover
of this prospectus. Our business, financial condition, results of operations and
prospects may have changed since that date. This prospectus is based on
information provided by us and other sources that we believe are reliable. We
have summarized certain documents and other information in a manner we believe
to be accurate, but we refer you to the actual documents for a more complete
understanding of what we discuss in this prospectus. In making an investment
decision, you must rely on your own examination of our business and the terms of
the offering, including the merits and risks involved.

      We obtained statistical data, market data and other industry data and
forecasts used throughout, or incorporated by reference in, this prospectus from
market research, publicly available information and industry publications.
Industry publications generally state that they obtain their information from
sources that they believe to be reliable, but they do not guarantee the accuracy
and completeness of the information. Similarly, while we believe that the
statistical data, industry data and forecasts and market research are reliable,
we have not independently verified the data, and we do not make any
representation as to the accuracy of the information. We have not sought the
consent of the sources to refer to their reports appearing or incorporated by
reference in this prospectus.

      This prospectus contains, or incorporates by reference, trademarks,
tradenames, service marks and service names of Hudson Holding Corporation and
other companies.

                                       iv


<PAGE>


                       NOTE ON FORWARD LOOKING STATEMENTS

         Certain statements contained in this prospectus constitute
"forward-looking statements" as that term is defined under the Private
Securities Litigation Reform Act of 1995 and releases issued by the SEC and
within the meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934, as amended, (the "Exchange Act"). The words
"believe," "expect," "anticipate," "intend," "estimate," "plan" and other
expressions which are predictions of or indicate future events and trends and
which do not relate to historical matters identify forward-looking statements.
Reliance should not be placed on forward-looking statements because they involve
known and unknown risks, uncertainties and other factors, which may cause our
actual results, performance or achievements to differ materially from
anticipated future results, performance or achievements expressed or implied by
such forward-looking statements. Factors that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements include, but are not limited to: (a) our projected revenues and
profitability, (b) our growth strategies, (c) anticipated trends in our
industry, (d) our future financing plans and (e) our anticipated needs for
working capital.

         The foregoing does not represent an exhaustive list of risks. Please
see "Risk Factors" for additional risks which could adversely impact our
business and financial performance. Moreover, new risks emerge from time to time
and it is not possible for our management to predict all risks, nor can we
assess the impact of all risks on our business or the extent to which any risk,
or combination of risks, may cause actual results to differ from those contained
in any forward-looking statements. All forward-looking statements included in
this prospectus are based on information available to us on the date of this
prospectus. Except to the extent required by applicable laws or rules, we
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise.
All subsequent written and oral forward-looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by the
cautionary statements contained throughout this prospectus.

                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The following documents, heretofore filed by us with the U.S.
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended, are hereby incorporated by reference, except as superseded or
modified herein:

     1    Our Annual Report on Form 10-KSB for the fiscal year ended March 31,
          2007, filed on June 29, 2007;
     2.   Our Definitive Proxy Statement on Form 14A, filed on July 20, 2007;
     3.   Our Quarterly Report on Form 10-QSB for the quarterly period ended
          June 30, 2007, filed on August 13, 2007;
     4.   Our Current Report on Form 8-K, filed on October 3, 2007;
     5.   Our Quarterly Report on Form 10-QSB for the quarterly period ended
          September 30, 2007, filed on November 14, 2007.
     6.   The description of our common stock contained in our Registration
          Statement on Form SB-2 filed on March 28, 2007.

         All documents filed by the registrant after the date of filing the
initial registration statement on Form S-8 of which this prospectus forms a part
and prior to the effectiveness of such registration statement pursuant to
Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 shall
be deemed to be incorporated by reference into this prospectus and to be part
hereof from the date of filing of such documents.

         We will provide without charge to each person to whom a copy of this
prospectus is delivered, upon the written or oral request of any such person, a
copy of any document described above (other than exhibits). Requests for such
copies should be directed to Hudson Holding Corporation, 111 Town Square Place,
Suite 1500A, Jersey City, New Jersey 07310; Attention: Marty Cunningham.

         You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. You should not assume
that the information in this prospectus or any prospectus supplement is accurate
as of any date other than the date on the front page of those documents.



                                      -1-
<PAGE>



                               PROSPECTUS SUMMARY

      THE FOLLOWING SUMMARY HIGHLIGHTS SELECTED INFORMATION CONTAINED IN THIS
PROSPECTUS. THIS SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION YOU SHOULD
CONSIDER BEFORE INVESTING IN THE SECURITIES. BEFORE MAKING AN INVESTMENT
DECISION, YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE RISK
FACTORS SECTION AS WELL AS THE FINANCIAL STATEMENTS AND THE NOTES TO THE
FINANCIAL STATEMENTS INCORPORATED HEREIN BY REFERENCE. IN THIS PROSPECTUS AND
ANY AMENDMENT OR SUPPLEMENT HERETO, UNLESS OTHERWISE INDICATED, THE TERMS
"HUDSON HOLDING CORPORATION", THE "COMPANY", "WE", "US", AND "OUR" REFER AND
RELATE TO HUDSON HOLDING CORPORATION AND ITS CONSOLIDATED SUBSIDIARIES.


GENERAL

Hudson Holding Corporation ("Holding") is a holding company and is the parent of
its wholly owned subsidiaries, namely Hudson Securities, Inc. ("Hudson") and
Hudson Technologies, Inc. ("HTI"), (collectively the "Company"). Hudson is a
registered broker-dealer under the Securities Exchange Act of 1934 and is a
member of the Financial Industry Regulatory Authority ("FINRA"). The Company has
offices in New Jersey and Florida. HTI was formed for the purpose of providing
software development and technology services for Hudson and for third parties.

On June 30, 2004, Hudson's current management team consummated the purchase of
all of the outstanding shares of the predecessor broker-dealer's common stock.
Subsequently, on July 21, 2004, the predecessor broker-dealer formed a wholly
owned subsidiary named Hudson Capital Markets, Inc. ("HCMI"), which was
organized in the state of Delaware. On July 31, 2004, the predecessor
broker-dealer was merged into HCMI, with HCMI becoming the survivor ("HCMI
Merger") and the name was changed to Hudson Securities, Inc.

In December 2004, Hudson entered into an Agreement and Plan of Merger (the
"Agreement") with Health Outcomes Management, Inc. ("HOM"), a non-operating
public company. On May 3, 2005, under the terms of the Agreement, Hudson's
stockholders exchanged all of their shares of common stock and warrants for
shares of HOM common stock (the "Exchange"). The HOM shares that were issued to
Hudson stockholders in the merger represented 94% of HOM's outstanding interest
at the time of this exchange. In connection with the legal form of this
transaction, Hudson became a wholly owned subsidiary of HOM. On September 6,
2005, HOM changed its name to Hudson Holding Corporation and effectuated a one
for eight reverse stock split for all stockholders of record as of the close of
business on June 13, 2005. For financial reporting purposes, the Exchange
represents a capital transaction of Hudson or a "reverse merger" rather than a
business combination.

OPERATIONS

Hudson is a member of FINRA and is insured by the Securities Investor Protection
Corporation. Hudson is a market maker trading more than 9,000 NASDAQ, non-NASDAQ
OTC, listed and foreign securities, and specializes in providing liquidity in
less liquid, difficult to trade stocks. Hudson has been in business since 1984.

As a market maker, Hudson provides its customers with order executions. When
customers come to Hudson seeking to buy or sell securities, the firm works to
satisfy the customers' needs, either by finding counterparties willing to trade
with the customers (obtaining liquidity) or, where appropriate, by taking the
other side of the trades, thereby providing liquidity for its customers by
purchasing or selling the securities itself. In a sense, liquidity is the
product that Hudson sells to its customers.

Hudson's customers are firms that require liquidity to complete stock trades,
funds whose investment decisions call for shifts into or out of certain stocks,
retail customers, professional traders who want to establish or liquidate their
positions, and other retail brokerage firms whose individual investor clients
wish to buy or sell securities. By trading with Hudson, its customers are able
to obtain liquidity.

Providing trade executions generates two types of revenue for Hudson, commission
revenue and trading revenue.

Commission revenue comes from the fees that Hudson charges its customers for
executing their orders, generally a fixed price per share traded. Revenue may
vary with the number and size of Hudson's customers and with their level of
trading activity. Commission revenue is free of market risk for Hudson since
Hudson acts as an agent and does not take any proprietary security positions.

                                      -2-
<PAGE>


Trading revenue is derived from the profit and loss associated with purchases
and sales of securities for Hudson's trading account, for securities in which
Hudson makes markets. In doing so, the firm itself is at risk to changes in
stock prices. Trading profits are obtained by paying less to buy shares for its
own account than the firm receives for selling those shares. Because the price
for which the firm is willing to purchase shares (its "bid" price) is always
less than the price at which it would then sell those shares (its "ask" price),
trading with a customer presents a market maker with an opportunity to capture
the difference between these prices (the "bid-ask spread") provided it can find
a contra-party with whom to trade in the same security before the stock price
moves against the trader. Finding a counter party to take the other side of a
trade can be challenging, and failure to find a counter party at the right price
or time can lead to a loss.

COMPETITIVE ADVANTAGES

Hudson believes that it differentiates itself by the stocks it trades and by the
customers it serves. While many of the firm's competitors emphasize NASDAQ
National Market stocks, Hudson focuses on providing liquidity in
difficult-to-trade stocks, including shares quoted on the OTC Bulletin Board and
Pink Sheets and second tier and Small-Cap NASDAQ stocks. Hudson's strategy is to
maintain and grow existing relationships with retail firms while seeking to
attract new customers from among other retailers that the firm's competitors
neglect as well as targeted insitutions.

TECHNOLOGY

Hudson maintains a multi-tier connectivity network to receive customers' orders,
to monitor the markets, and to communicate with trading partners. Hudson's
traders have the ability to trade all U.S. equities, using Sungard's BRASS order
management system to process incoming orders and its UMA market access system
and the NASDAQ Level III system to enter orders. These systems interface with
Goldman Sachs Execution & Clearing, L.P. (Hudson's clearing broker) to ensure
trades are processed. The firm's Jersey City, Tinton Falls and Boca Raton
offices are in constant communication and can serve as back-up for one another
in case of system failures.

Hudson has migrated to Sungard's "dedicated complex" on which Hudson can run its
BRASS servers. The facility is capable of executing trades at peak rates of
approximately triple the previous average rate. Its complete implementation has
allowed Sungard to be more responsive to Hudson's needs, provided the ability to
make changes to the system during trading hours, and facilitated the addition of
a dedicated FIX-protocol communications server, which simplified the setup of
new customer connections.

HTI is a hardware and software technology division of Hudson Holding
Corporation. HTI creates and develops software to enhance the trading
environment of Hudson Securities and to meet customers' needs for customized
services. To date, HTI has created applications that advance the base
functionality of BRASS, a Sungard Order Management System. The profit and loss
system developed by HTI is a tool for equities sales traders of Hudson
Securities which on a nightly basis calculates what they have earned based on
their customer order flow. The system also creates a management report, as well
as several other customer reports to enhance the value of Hudson Securities to
its clients. To the extent that these programs may be useful for other brokerage
firms, HTI may sell or license these programs to others.

HTI, through its value added vendor relationships, has created several modules
using the BRASS OAPI, (an open OPI which allows Hudson to write code to the
application) which will be able to provide added functionality for the traders
of Hudson Securities. HTI also operates a carrier neutral co-location data
center where customers can rent cabinets, paying HTI a monthly fee. HTI also
generates revenues by providing co-location customers with remote hands support.

                                      -3-
<PAGE>


FUTURE PRODUCTS AND SERVICES

Hudson is actively seeking to expand into complementary businesses, both by
developing new product/service offerings that will be valuable to the firm's
existing customers and by entering into strategic partnerships with related
businesses that can increase its number of new customers. There can be no
assurance that we will meet our goal. Strategic partnership candidates include
boutique investment banking and money management firms. It may be necessary to
acquire new businesses or hire experienced personnel to effectuate expansion
plans in these areas.

THE MARKET

Hudson focuses on attracting orders from retail brokerage firms and buy-side
institutions, such as mutual funds, hedge funds and trusts.

Market makers' main customers are retail brokers and institutions that require
order executions for varieties of stocks, from widely traded issues, like those
of S&P 500 and NASDAQ 100 companies, to less liquid securities such as NASDAQ
Small-Cap, Bulletin Board, and Pink Sheet stocks.

While offering liquidity across a broad range of stocks to both institutional
and retail brokerage customers, Hudson intends to focus its resources on
increasing the firm's market share as a liquidity provider to retail brokerage
firms and institutions, plus on specializing in less liquid issues.

Management believes that retail order-entry firms are being neglected in the
increasing competition among market makers for institutional customers, offering
the firm an opportunity to increase its presence in that segment. Meanwhile,
particularly as large competitors decrease their commitment to the market making
business in light of recent "lean years," lucrative retail brokerage customers
may be interested in investigating alternative relationships, presenting Hudson
with an opportunity to attract such customers. By establishing a large pool of
retail orders, management believes that the firm will ultimately be better
positioned to attract buy-side institutional firms in search of liquidity.

By focusing on less liquid stocks, the firm avoids some of the fiercest
competition among market makers and other liquidity providers such as Electronic
Crossing/Communication Networks (ECN's). At the same time, Hudson provides a
less available service, finding a firm willing to fill an order for little-known
pink sheet stocks. However, trading less liquid issues exposes firms to greater
price volatility and thus greater risk. There is less investor interest in
trading such securities, but the wider spreads have greater profit potential.
Hudson trades many of the most active NASDAQ National Market stocks, and by
focusing on smaller issues management hopes to appeal to retail brokers in need
of liquidity while maximizing the firm's profit potential.

INDUSTRY ANALYSIS

Historically, a handful of market makers have accounted for most of the shares
traded on the NASDAQ, OTC Bulletin Board and Pink Sheets. Retail brokers and
institutions prefer to have relationships with (and communication links to) more
than one market-maker. This engenders competition among market makers, inducing
them to offer fast executions, favorable prices, payment for order flow,
liquidity, research, convenience, and trustworthiness.

INDUSTRY PARTICIPANTS

Over the last several years there has been a rapid consolidation in the market
making industry, as global financial corporations that entered the business near
the height of the market in the late 1990's subsequently scaled back, as the
market (and trading volumes and profits) retreated. While 200+ "market makers"
are currently registered to trade bulletin board stocks*, we believe that many
choose to register as market makers for technical reasons, and only a handful of
these firms (including Hudson) actively compete to fill orders from retail
brokers' customers. Historically, two of the largest market makers, Knight
Equity Markets and UBS Securities, dominate the market, accounting for a
majority of NASDAQ, OTC Bulletin Board and Pink Sheet volume.

*according to http://www.otcbb.com/dynamic/tradingdata/MarketMakersPositions/
MMakersdata.htm


                                      -4-
<PAGE>


COMPETITION

Market making can be viewed by some as a commodity business, with participants
all offering prompt executions of customer orders. But in an industry where
everyone sells (or buys) identical shares of stock, there are criteria whereby
market makers manage to distinguish themselves from their competition. Factors
on which market makers compete include execution quality (speed and price),
payment for orderflow, securities traded and available liquidity, research,
service, ease of use and relationships.

Many of our competitors have greater financial, technical and personnel
resources than Hudson. We compete with over 200 market makers, and specifically
with Knight Trading Group and UBS Securities, two of the largest market makers.
Our ability to continue to compete with other market makers will depend on our
financial resources, trading ability, and our ability to provide other
complementary services to our clients.

To help attract new customers, the firm is striving to increase the list of
securities available for trading. Since the beginning of 2003, Hudson began
making markets in additional NASDAQ stocks. In addition, the firm now trades
securities which are listed on certain US and foreign exchanges. Management is
committed to expanding the list even more going forward, particularly with the
future deployment of the firm's automated trading system.

FUTURE GROWTH

In addition to growing its market making business, the firm also intends to
enter other (related) business lines, as discussed below. Management believes
that entering other related businesses will help reduce earnings fluctuations.
In addition, management hopes that the introduction of related business lines
will help the firm to attract new customers to its market making business. The
firm intends to pursue both organic growth and acquisitions to meet this goal,
although there can be no assurance that management will meet these goals.

Furthermore, management is considering building a retail brokerage business
driven by independent sales representatives. The firm would offer brokerage
business necessities (office space, trading and clearing systems, statement
generation) to retail brokers who prefer not to work in the traditional
brokerage environment. Brokers would be allowed wide latitude in deciding how to
best service their customers (subject to relevant industry rules). With such a
division, in addition to adding a potentially profitable business, Hudson
believes it would effectively create a new customer for its market making
services.

GOVERNMENT REGULATION

The securities industry in the United States is subject to extensive regulation
under both federal and state laws. Hudson is registered as a broker-dealer with
the SEC and certain state securities divisions. Much of the regulation of
broker-dealers has been delegated to self-regulated organizations, principally
FINRA, Nasdaq and national securities exchanges. These self-regulatory
organizations adopt rules (subject to approval by the SEC) that govern the
industry and conduct regular and periodic examinations of our operations.
Securities firms are also subject to regulation by state securities
administrators in those states in which they conduct business. The Company is
also subject to oversight by the U.S. Department of Labor in connection with our
benefit plans.

Significant legislation, rule-making and market structure changes have occurred
over the last five years that have had an impact on the Company. First,
decimalization was introduced in January 2001 in NYSE and AMEX listed
securities, and in Nasdaq markets in April 2001. Decimalization, combined with
the one-penny minimum price increment, has had a dramatic reduction in average
spreads, which in turn has had a profound effect on our profitability. Second,
in 2002 Nasdaq launched SuperMontage, a Nasdaq routing and execution system.
SuperMontage transformed Nasdaq from a quote-driven market to a
full-order-driven market as quotes and orders are treated the same. Under
SuperMontage, market makers and ECNs are able to show trading interest at five
different price levels, allowing investors to see individual and aggregated
interest across all market participants at the National Best Bid or Offer
("NBBO") and four additional layers above or below the NBBO. Third, the
introduction of SuperMontage, which is not used by all market participants, and
the increase in trading of Nasdaq-listed securities by other exchanges has
created market fragmentation. This lack of linkage between market centers has
resulted in an increase in locked and crossed markets, fragmented liquidity
pools and different market centers using different sets of regulatory rules and
regulations. Fourth, the U.S. Patriot Act of 2001, enacted in response to the
terrorist attacks on September 11, 2001, contains anti-money laundering and
financial transparency laws and mandates the implementation of various new
regulations applicable to broker-dealers and other financial services companies,
including standards for verifying client identification at account opening, and
obligations to monitor client transactions and report suspicious activities. The
increased obligations of financial institutions to identify their customers,

                                      -5-
<PAGE>

watch for and report suspicious transactions, respond to requests for
information by regulatory authorities and law enforcement agencies, and to share
information with other financial institutions, requires the implementation and
maintenance of internal practices, procedures and controls which will increase
our costs and may subject us to regulatory inquiries, claims or penalties.
Lastly, the Sarbanes-Oxley Act of 2002 has led to sweeping changes in corporate
governance. This far reaching legislation has significantly affected public
companies by enacting provisions covering corporate governance, board of
directors and audit committee structure, management and control structure, new
disclosure requirements, oversight of the accounting profession and auditor
independence. The SEC also responded by, among other things, requiring chief
executive officers and chief financial officers of public companies to certify
the accuracy of certain financial reports and certain other SEC filings.

The regulatory environment in which we operate is subject to constant change.
Our business, financial condition and operating results may be adversely
affected as a result of new or revised legislation or regulations imposed by the
U.S. Congress, the SEC, other U.S. and state governmental regulatory
authorities, or FINRA. Our business, financial condition and operating results
also may be adversely affected by changes in the interpretation or enforcement
of existing laws and rules by these governmental authorities.

Additional regulation, changes in existing laws and rules, or changes in
interpretations or enforcement of existing laws and rules often directly affect
the method of operation and profitability of regulated broker-dealers.

FINRA AND NET CAPITAL REQUIREMENTS

Regulatory bodies, including FINRA, are charged with safeguarding the integrity
of the securities industry and with protecting the interests of investors
participating in those markets. Broker-dealers are subject to regulations
covering all aspects of the securities business, including sales methods, trade
practices among broker-dealers, use and safekeeping of clients' funds and
securities, capital structure, record keeping and the conduct of directors,
officers and employees.

The SEC, FINRA and various other regulatory agencies have rigid rules, including
the maintenance of specific levels of net capital by securities brokers and
dealers pursuant to the SEC's Uniform Net Capital Rule 15c3-1 with which the
Company must comply. As of October 31, 2007, the Company had total net capital
of $5,205,259, which is $4,205,259 in excess of the Company's minimum net
capital requirement of $1,000,000.

Additionally, the Company is subject to periodic, routine finance and operations
reviews by FINRA staff and state securities divisions. It should be noted that
the Company has a disciplinary record with FINRA and fines have been levied
against the Company for violations that occurred during the tenure of the prior
management. Given FINRA's policy of progressive disciplinary actions, this prior
record could adversely impact the Company if we are cited for additional
violations.

EMPLOYEES

As of November 30, 2007, we employed 86 individuals. Of the 86 employees, 7 are
in management, 26 are in trading, 31 are in sales, 2 are in compliance, 7 are in
technology and 13 are in administration. We believe that our relations with our
employees are good. None of our employees are represented by a union or any
collective bargaining agreement.

CORPORATE INFORMATION

Our principal offices are located at 111 Pavonia Avenue, Suite 1500A, Jersey
City, New Jersey 07310 and our telephone number is (201) 216-0100. Our corporate
website is http://www.hudsonholdingcorp.com. The information on our website is
not incorporated by reference to this annual report.

We file reports and other information with the SEC. The SEC maintains an
internet site that contains reports, proxy, information statements and other
information at http://www.sec.gov.

                                      -6-
<PAGE>




                                  THE OFFERING

OUTSTANDING COMMON               36,725,185 shares of our common stock issued
                                 and outstanding as of November 30, 2007

COMMON STOCK OFFERED             Up to 12,000,000 shares.

USE                              OF PROCEEDS We will not receive any proceeds
                                 from the sale of our common stock by the
                                 selling stockholders. We would, however,
                                 receive proceeds upon the exercise of options
                                 received under the Plans. Any cash proceeds
                                 will be used by us for general corporate
                                 purposes.

RISK FACTORS                     The securities offered hereby involve a high
                                 degree of risk.  See "Risk Factors".

OTCBB SYMBOL                     HDHL OB

                  [remainder of page intentionally left blank]



                                      -7-
<PAGE>


                                  RISK FACTORS

      AN INVESTMENT IN OUR COMPANY IS EXTREMELY RISKY. YOU SHOULD CAREFULLY
CONSIDER THE FOLLOWING RISKS, IN ADDITION TO THE OTHER INFORMATION PRESENTED IN
THIS PROSPECTUS BEFORE DECIDING TO BUY OR EXERCISE OUR SECURITIES. IF ANY OF THE
FOLLOWING RISKS ACTUALLY MATERIALIZE, OUR BUSINESS AND PROSPECTS COULD BE
SERIOUSLY HARMED, THE PRICE AND VALUE OF OUR SECURITIES COULD DECLINE AND YOU
COULD LOSE ALL OR PART OF YOUR INVESTMENT.

RISKS RELATED TO OUR BUSINESS

STOCK MARKET VOLATILITY AND OTHER SECURITIES INDUSTRY RISKS COULD ADVERSELY
AFFECT OUR BUSINESS.

Substantially all of our revenues are derived from securities market activities.
As a result, we are directly affected by economic and political conditions,
broad trends in business and finance and changes in volume and price levels of
securities transactions. In recent years, the U.S. securities markets have been
very volatile, which has reduced trading volume and net revenues. The tightening
of credit, the terrorist attacks in the United States on September 11, 2001, the
invasion of lraq in 2003 and other events have also resulted in substantial
market volatility and accompanying reductions in trading volume and net
revenues. In addition, any general economic downturn would adversely affect
trading volumes and net revenues. Severe market fluctuations or weak economic
conditions could reduce our trading volume and net revenues and adversely affect
our profitability.

WE ARE SUBJECT TO MARKET EXPOSURE AND COULD BE ADVERSELY AFFECTED BY A DECREASE
IN THE PRICE OF SECURITIES WHICH WE HOLD IN OUR TRADING ACCOUNTS.

We conduct our market-making activities predominantly as principal, which
subjects our capital to significant risks. These activities involve the
purchase, sale or short sale of securities for our own account and, accordingly,
involve risks of price fluctuations and illiquidity, or rapid changes in the
liquidity of markets that may limit or restrict our ability to either resell
securities we purchase or to repurchase securities we sell in such transactions.
From time to time, we may have large position concentrations in securities of a
single issuer or issuers engaged in a specific industry, which might result in
higher trading losses than would occur if our positions and activities were less
concentrated. The success of our market-making activities primarily depends upon
our ability to attract order flow, the skill of our personnel, general market
conditions, the amount of, and volatility in, our quantitative market-making and
program trading portfolios, effective hedging strategies, the price volatility
of specific securities and the availability of capital. To attract order flow,
we must be competitive on price, size of securities positions traded, liquidity,
order execution, technology, reputation and client relationships and service. In
our role as a market maker, we attempt to derive a profit from the difference
between the prices at which we buy and sell securities. However, competitive
forces often require us to match the quotes other market makers display and to
hold varying amounts of securities in inventory. By having to maintain inventory
positions, we are subject to a high degree of risk. There can be no assurance
that we will be able to manage such risk successfully or that we will not
experience significant losses from such activities.

THERE IS A RISK THAT OUR FUTURE OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY.

We may experience significant variation in our future results of operations.
These fluctuations may result from, among other things:

o    introductions of or enhancements to market-making services by us or our
     competitors;
o    the value of our securities positions and our ability to manage the risks
     attendant thereto;
o    the volume of our market-making activities;
o    the dollar value of securities traded;
o    volatility in the securities markets;
o    our market share with institutional clients;
o    our ability to manage personnel, overhead and other expenses, including our
     occupancy expenses under our office leases and legal fees relating to legal
     and regulatory proceedings;
o    the strength of our client relationships; the amount of, and volatility in,
     our quantitative market-making and program trading portfolios;
o    changes in payments for order flow and clearing costs;
o    the addition or loss of executive management and sales, trading and
     technology professionals;
o    legislative, legal and regulatory changes;
o    legal and regulatory matters;

                                      -8-
<PAGE>

o    geopolitical risk;
o    the amount and timing of capital expenditures and divestitures;
o    the incurrence of costs associated with acquisitions and dispositions;
o    investor sentiment;
o    technological changes and events;
o    seasonality; and
o    competition and market and economic conditions.

If demand for our services declines due to any of the above factors, and we are
unable to timely adjust our cost structure, our operating results could be
materially and adversely affected.

OUR TRADERS MAY TAKE LARGER RISKS THAN PERMITTED WHICH COULD RESULT IN LARGE
LOSSES.

Although we require our traders to adhere to certain position limits (generally
no more than $500,000 in total positions for the most experienced traders,
without managerial approval), sometimes a trader takes a position beyond these
limits and subjects our company to greater risks. We have established procedures
to guard against this, including real-time position monitoring which should
promptly alert management to any excessive risks. However, there can be no
assurance that management will be able to guard against all risks taken by each
employee.

WE ARE DEPENDENT ON OUR CLEARING BROKER, WHICH MAY GO OUT OF BUSINESS OR CHARGE
US FOR A DEFAULT BY A COUNTER PARTY TO A TRADE.

As a market maker, the majority of our securities transactions are conducted as
principal with broker-dealer and institutional counterparties located in the
United States. We clear our securities transactions through an unaffiliated
clearing broker. Under the terms of the agreement between us and our clearing
broker, the clearing broker has the right to charge us for losses that result
from a counterparty's failure to fulfill its contractual obligations. No
assurance can be given that any such counterparty will not default on its
obligations, which default could have a material adverse effect on our business,
financial condition and operating results. In addition, at any time, a
substantial portion of our assets are held by our clearing broker and,
accordingly, we are subject to credit risk with respect to such clearing broker.
Consequently, we are reliant on the ability of our clearing broker to adequately
discharge its obligations on a timely basis. We are also dependent on the
solvency of such clearing broker. Any failure by the clearing broker to
adequately discharge its obligations on a timely basis, or failure by the
clearing broker to remain solvent, or any event adversely affecting the clearing
broker, could have a material adverse effect on our business, financial
condition and operating results. If our clearing broker was to go out of
business or decide not to continue to act as our clearing broker, our operating
results would be adversely effected until we could replace them.

REDUCED MARKET VOLUME, PRICE AND LIQUIDITY CAN IMPACT OUR REVENUES.

Our revenues may decrease in the event of a decline in market volume, prices or
liquidity. Declines in the volume of securities transactions and in market
liquidity generally result in lower revenues from market-making activities.
Lower price levels of securities may also result in reduced revenue capture, and
thereby reduced revenues from market-making transactions, as well as result in
losses from declines in the market value of securities held in inventory. Sudden
sharp declines in market values of securities can result in illiquid markets,
declines in the market values of securities held in inventory, the failure of
buyers and sellers of securities to fulfill their obligations and settle their
trades, and increases in claims and litigation. Any decline in market volume,
price or liquidity or any other of these factors could have a material adverse
effect on our business, financial condition and operating results.

WE OPERATE IN A HIGHLY REGULATED INDUSTRY AND COMPLIANCE FAILURES COULD
ADVERSELY AFFECT OUR BUSINESS.

The securities industry is subject to extensive regulation covering all aspects
of the securities business. The various governmental authorities and industry
self-regulatory organizations that supervise and regulate us generally have
broad enforcement powers to censure, fine, issue cease-and-desist orders or
suspend or expel us or any of our officers or employees who violate applicable
laws or regulations. We may also be subject to an enforcement action for failure
to supervise if any of our employees or traders violate applicable laws or
regulations. Our ability to comply with all applicable laws and rules is largely
dependent on our establishment and maintenance of compliance and reporting
systems, as well as our ability to attract and retain qualified compliance and
other personnel. If we do not comply with the rules and regulations established,
we could be subject to disciplinary or other regulatory or legal actions in the
future. In addition, it is possible that any past noncompliance could subject us
to future civil lawsuits, the outcome of which could have a material adverse
effect on our financial condition and operating results.

                                      -9-
<PAGE>


We are required to keep accurate books and records. There is considerable
fluctuation during any year and from year-to-year in the volume of transactions
we must process. We record transactions and post our books daily. Operations
personnel monitor operations to determine compliance with applicable laws, rules
and regulations. Failure to keep current and accurate books and records can
render us liable to disciplinary action by governmental and self-regulatory
authorities, as well as to claims by our clients.

WE HAVE A PRIOR DISCIPLINARY RECORD WITH FINRA, WHICH COULD HAVE AN ADVERSE
EFFECT ON OUR ABILITY TO OPERATE IF WE BECOME SUBJECT TO ADDITIONAL FINRA
DISCIPLINARY ACTION.

During the period from approximately 1990 through July 31, 2004, primarily while
our operating subsidiary Hudson Securities was owned by and supervised by the
prior management of the prior owners and operating under a different name, we
were cited by the NASD (now known as FINRA) for violations of the NASD's Rules
of Fair Practice and Marketplace Rules on at least 20 occasions and were fined
amounts ranging from $250 to $82,500. The total amount of such fines was
approximately $405,000. The existence of such prior violations could have an
adverse effect on us should such violations recur under the supervision of
current management.

WE FACE SUBSTANTIAL COMPETITION THAT COULD REDUCE OUR MARKET SHARE AND HARM OUR
FINANCIAL PERFORMANCE.

All aspects of our business are highly competitive. We compete directly with
national and regional full service broker-dealers and, to a lesser extent, with
discount brokers, investment advisors and certain commercial banks. The
financial services industry has become considerably more concentrated as
numerous securities firms have either ceased operations or have been acquired by
or merged into other firms. These mergers and acquisitions have increased
competition from these firms, many of which have significantly greater capital
and financial and other resources than we have. With respect to retail brokerage
activities, certain regional firms with which we compete have operated in
certain markets longer than we have and have established long-standing client
relationships. We also compete with others in the financial services industry in
recruiting registered representatives and new employees as well as retaining
current personnel, and we could be adversely affected in the event we were to
lose registered representatives who either individually or in the aggregate
accounted for a significant percentage of our revenues.

IF WE LOSE SENIOR MANAGEMENT AND KEY PERSONNEL OR ARE UNABLE TO ATTRACT AND
RETAIN SKILLED EMPLOYEES WHEN NEEDED, WE MAY NOT BE ABLE TO OPERATE OUR BUSINESS
SUCCESSFULLY.

We are particularly dependent on the services of Mark Leventhal, Martin
Cunningham and Keith Knox. The loss of any of these individuals would have a
significant negative effect on our business. In addition, we believe that our
success will depend in large part upon our continued ability to attract and
retain skilled traders and other employees, which is difficult because the
market for the services of such individuals is very competitive. On January 4,
2007, the Company entered into five year employment agreements, effective as of
January 1, 2007, with Mr. Martin C. Cunningham and Mr. Keith R. Knox, whereby
each will continue in their present positions, Chief Executive Officer and
President, respectively.

WE NEED TO COMPLY WITH STRINGENT CAPITAL REQUIREMENTS AND THEREFORE IF WE SUFFER
SIGNIFICANT LOSSES WE WOULD BE BELOW OUR NET CAPITAL REQUIREMENT.

Many of the regulatory agencies, securities exchanges and other industry
self-regulatory organizations that regulate us have stringent rules with respect
to the maintenance of specific levels of net capital by securities
broker-dealers. Net capital is the net worth of a broker or dealer, less
deductions for certain types of assets. Currently, we are required to maintain
net capital of at least $1,000,000. As of October 31, 2007, we had net capital
of $5,205,259 and excess net capital (that is, net capital less required net
capital) of $4,205,259. We intend to maintain such funds as are necessary to
operate our business and to maintain compliance with regulatory net capital
requirements. Changes to our business may require us to maintain higher net
capital levels than currently. If we fail to maintain the required net capital,
we may be subject to suspension or revocation of our licenses. If such net
capital rules are changed or expanded, or if there is an unusually large charge
against our net capital, we might be required to limit or discontinue those
portions of our business that require the intensive use of capital. A large
operating loss or charge against net capital could adversely affect our ability
to expand or even maintain our present levels of business.

                                      -10-
<PAGE>



WE MAY NOT BE ABLE TO GROW AS PLANNED.

As part of our long-term growth strategy, we intend to recruit individual
registered representatives and to evaluate the acquisition of other firms or
assets that would complement or expand our business in attractive service
markets or that would broaden our customer relationships. We cannot assure you
that we will be successful in our recruiting efforts or that we will be able to
identify suitable acquisition candidates available for sale at reasonable prices
or that we will be able to consummate any acquisition. Further, future
acquisitions may further increase our leverage or, if we issue equity securities
to pay for the acquisitions, our stockholders could suffer dilution of their
interests.

We also plan to expand into complementary businesses, both by developing new
product/service offerings that will be valuable to our existing customers and by
entering into strategic partnerships with related businesses that can bring new
customers. The firm now trades listed securities. In addition, we plan to
explore creating a retail brokerage division. There can be no assurance that any
of the new products or services will be developed. If we are unable to raise
adequate capital, we will not have the available funds to create new products.

OUR EXPOSURE TO POSSIBLE LITIGATION COULD ADVERSELY AFFECT OUR BUSINESS.

From time to time we are engaged in various legal and regulatory proceedings
arising in the normal course of business. Many aspects of the securities
brokerage business involve substantial risks of liability. In recent years,
there has been an increasing incidence of litigation involving the securities
brokerage industry, including class action and other suits that generally seek
substantial damages, including in some cases punitive damages. While it is not
possible to determine with certainty the outcome of these matters, we are of the
opinion that the eventual resolution of such proceedings will not have a
material adverse effect on our financial position or operating results. Any such
litigation brought in the future could have a material adverse effect on our
business, financial condition and operating results.

From time to time, we may also be engaged in various legal proceedings not
related to securities. We currently maintain various types of insurance,
including employment practices liability insurance, the proceeds of which may
help to reduce the amount we may otherwise be required to pay with respect to
certain types of claims. However, there can be no assurance that we will be able
to obtain such insurance in the future. If it can be obtained, the price for
such insurance may be unreasonable. Even if such insurance is in force, the
amount of any award may exceed the maximum coverage provided by such insurance,
in which case we will be required to pay any uncovered portion.

OUR BUSINESS RELIES HEAVILY ON COMPUTERS AND OTHER ELECTRONIC SYSTEMS AND
CAPACITY CONSTRAINTS AND FAILURES OF THESE SYSTEMS COULD HARM OUR BUSINESS.

Despite efforts to minimize the risk, system failures could negatively impact
our ability to conduct our business. Furthermore, as our business expands, we
face risks relating to the need to expand and upgrade our transaction processing
systems, network infrastructure and other aspects of our technology. While many
of our systems are designed to accommodate additional growth without redesign or
replacement, we may nevertheless need to make significant investments in
additional hardware and software to accommodate growth. We cannot assure you
that we will be able to predict accurately the timing or rate of such growth, or
expand and upgrade our systems and infrastructure on a timely basis.

RISKS ASSOCIATED WITH OUR SECURITIES

OUR COMMON STOCK IS NOT ACTIVELY TRADED, SO YOU MAY BE UNABLE TO SELL AT OR NEAR
ASK PRICES OR AT ALL IF YOU NEED TO SELL YOUR SHARES TO RAISE MONEY OR OTHERWISE
DESIRE TO LIQUIDATE YOUR SHARES.

Our Common Stock has historically been sporadically traded on the OTC Bulletin
Board, meaning that the number of persons interested in purchasing our Common
Stock at or near ask prices at any given time has been, and may continue to be,
relatively small or non-existent. This situation is attributable to a number of
factors, including the fact that we are a small company which is relatively
unknown to stock analysts, stock brokers, institutional investors and others in
the investment community that generate or influence sales volume, and that even
if we came to the attention of such persons, they tend to be risk-adverse and
would be reluctant to purchase or recommend the purchase of our shares until
such time as we became more seasoned and viable. As a consequence, there may be
periods of several days or more when trading activity in our shares is minimal
or non-existent, as compared to a seasoned issuer which has a large and steady
volume of trading activity that will generally support continuous sales without
an adverse effect on share price. We cannot assure you that a broader or more
active public trading market for our Common Stock will develop or be sustained,
or that current trading levels will be sustained or not diminish.

                                      -11-
<PAGE>


THE APPLICATION OF THE "PENNY STOCK" RULES TO OUR COMMON STOCK COULD LIMIT THE
TRADING AND LIQUIDITY OF THE COMMON STOCK, ADVERSELY AFFECT THE MARKET PRICE OF
OUR COMMON STOCK AND INCREASE YOUR TRANSACTION COSTS TO SELL THOSE SHARES.

As long as the trading price of our Common Stock is below $5.00 per share, the
open-market trading of our Common Stock will be subject to the "penny stock"
rules. The "penny stock" rules impose additional sales practice requirements on
broker-dealers who sell securities to persons other than established customers
and accredited investors (generally those with assets in excess of $1,000,000 or
annual income exceeding $200,000 or $300,000 together with their spouse). These
regulations require the delivery, prior to any transaction involving a penny
stock, of a disclosure schedule explaining the penny stock market and the
associated risks. Under these regulations, certain brokers who recommend such
securities to persons other than established customers or certain accredited
investors must make a special written suitability determination regarding such a
purchaser and receive such purchaser's written agreement to a transaction prior
to sale. These regulations have the effect of limiting the trading activity of
the Common Stock, reducing the liquidity of an investment in the Common Stock
and increasing the transaction costs for sales and purchases of our Common Stock
as compared to other securities.

THE MARKET PRICE FOR OUR COMMON STOCK IS PARTICULARLY VOLATILE GIVEN OUR STATUS
AS A RELATIVELY UNKNOWN COMPANY WITH A SMALL AND THINLY TRADED PUBLIC FLOAT,
LIMITED OPERATING HISTORY AND VARIABLE PROFITABILITY WHICH COULD LEAD TO WIDE
FLUCTUATIONS IN OUR SHARE PRICE. YOU MAY BE UNABLE TO SELL YOUR COMMON STOCK AT
OR ABOVE YOUR PURCHASE PRICE, WHICH MAY RESULT IN SUBSTANTIAL LOSSES TO YOU.

 The market for our Common Stock is characterized by significant price
volatility when compared to seasoned issuers, and we expect that our share price
will continue to be more volatile than a seasoned issuer for the indefinite
future. The volatility in our share price is attributable to a number of
factors. First, as noted above, our Common Stock is sporadically and thinly
traded. As a consequence of this lack of liquidity, the trading of relatively
small quantities of shares by our stockholders may disproportionately influence
the price of those shares in either direction. The price for our Shares could,
for example, decline precipitously in the event that a large number of shares of
our Common Stock are sold on the market without commensurate demand, as compared
to a seasoned issuer which could better absorb those sales without adverse
impact on its share price. Secondly, we are a speculative or "risky" investment
due to our limited operating history, and uncertainty of future market
acceptance for our services. As a consequence of this enhanced risk, more risk
adverse investors may, under the fear of losing all or most of their investment
in the event of negative news or lack of progress, be more inclined to sell
their shares on the market more quickly and at greater discounts than would be
the case with the stock of a seasoned issuer.

Many of these factors are beyond our control and may decrease the market price
of our Common Stock, regardless of our operating performance. We cannot make any
predictions or projections as to what the prevailing market price for our Common
Stock will be at any time, including as to whether our Common Stock will sustain
its current market price, or as to what effect that the sale of shares or the
availability of Common Stock for sale at any time will have on the prevailing
market price.

In addition, the market price of the Common Stock could be subject to wide
fluctuations in response to:

     o    quarterly variations in our revenues and operating expenses;
     o    fluctuations in interest rates;
     o    the operating and stock price performance of other companies that
          investors may deem comparable to us; and
     o    news reports relating to trends in our markets or general economic
          conditions.

The stock market in general and the market prices for brokerage-related
companies in particular, have experienced volatility that often has been
unrelated to the operating performance of such companies. These broad market and
industry fluctuations may adversely affect the price of our stock, regardless of
our operating performance.

Stockholders should be aware that, according to SEC Release No. 34-29093, the
market for penny stocks has suffered in recent years from patterns of fraud and
abuse. Such patterns include (1) control of the market for the security by one
or a few broker-dealers that are often related to the promoter or issuer; (2)
manipulation of prices through prearranged matching of purchases and sales and
false and misleading press releases; (3) boiler room practices involving
high-pressure sales tactics and unrealistic price projections by inexperienced

                                      -12-
<PAGE>

sales persons; (4) excessive and undisclosed bid-ask differential and markups by
selling broker-dealers; and (5) the wholesale dumping of the same securities by
promoters and broker-dealers after prices have been manipulated to a desired
level, along with the resulting inevitable collapse of those prices and with
consequent investor losses. The occurrence of these patterns or practices could
increase the volatility of our share price.

WE DO NOT INTEND TO PAY DIVIDENDS TO OUR STOCKHOLDERS.

We do not have any current plans to pay dividends to our stockholders. We
currently intend to retain any future earnings for funding growth and,
therefore, do not expect to pay any dividends in the foreseeable future.

FOUR EMPLOYEES CONTROL APPROXIMATELY 45% OF THE VOTING CAPITAL STOCK OF OUR
COMPANY.

Our three executive officers, plus Steven Winkler, our NASDAQ trading manager at
the Company's wholly-owned broker-dealer subsidiary, collectively own an
aggregate of 45% of our outstanding common stock. In the event that these
individuals vote together on any or all issues, you will have no effective voice
in our management. Accordingly, these four individuals could substantially
influence the outcome of any matters submitted to a vote of our stockholders and
have the ability to determine all management policy and financing decisions.

FUTURE SALES OF OUR COMMON STOCK COULD PUT DOWNWARD SELLING PRESSURE ON OUR
SHARES, AND ADVERSELY AFFECT THE STOCK PRICE. THERE IS A RISK THAT THIS DOWNWARD
PRESSURE MAY MAKE IT IMPOSSIBLE FOR A STOCKHOLDER TO SELL ITS SHARES AT ANY
REASONABLE PRICE, IF AT ALL.

Future sales of substantial amounts of our Common Stock in the public market, or
the perception that such sales could occur, could put downward selling pressure
on our shares, and adversely affect the market price of our Common Stock.

THERE ARE LIMITATIONS IN CONNECTION WITH THE AVAILABILITY OF QUOTES AND ORDER
INFORMATION ON THE OTC BULLETIN BOARD

Trades and quotations on the OTCBB involve a manual process, and the market
information for such securities cannot be guaranteed. In addition, quote
information, or even firm quotes, may not be available. The manual execution
process may delay order processing and intervening price fluctuations may result
in the failure of a limit order to execute or the execution of a market order at
a significantly different price. Execution of trades, execution reporting and
the delivery of legal trade confirmation may be delayed significantly.
Consequently, one may not be able to sell shares of our Common Stock at the
optimum trading prices.

THERE ARE DELAYS IN ORDER COMMUNICATION ON THE OTCBB.

Electronic processing of orders is not available for securities traded on the
OTCBB and high order volume and communication risks may prevent or delay the
execution of one's OTCBB trading orders. This lack of automated order processing
may affect the timeliness of order execution reporting and the availability of
firm quotes for shares of our Common Stock. Heavy market volume may lead to a
delay in the processing of OTCBB security orders for shares of our Common Stock,
due to the manual nature of the market. Consequently, one may not able to sell
shares of our Common Stock at the optimum trading prices.


THERE IS LIMITED LIQUIDITY ON THE OTCBB.

When fewer shares of a security are being traded on the OTCBB, volatility of
prices may increase and price movement may outpace the ability to deliver
accurate quote information. Due to lower trading volumes in shares of our Common
Stock, there may be a lower likelihood of one's orders for shares of our Common
Stock being executed, and current prices may differ significantly from the price
one was quoted by the OTCBB at the time of one's order entry.

THERE IS A LIMITATION IN CONNECTION WITH THE EDITING AND CANCELING OF ORDERS ON
THE OTCBB.

Orders for OTCBB securities may be canceled or edited like orders for other
securities. All requests to change or cancel an order must be submitted to,
received and processed by the OTCBB. Due to the manual order processing involved
in handling OTCBB trades, order processing and reporting may be delayed, and one
may not be able to cancel or edit one's order. Consequently, one may not able to
sell shares of our Common Stock at the optimum trading prices.

                                      -13-
<PAGE>


INCREASED DEALER COMPENSATION COULD ADVERSELY AFFECT THE STOCK PRICE.

The dealer's spread (the difference between the bid and ask prices) may be large
and may result in substantial losses to the seller of shares of our Common Stock
on the OTCBB if the stock must be sold immediately. Further, purchasers of
shares of our Common Stock may incur an immediate "paper" loss due to the price
spread. Moreover, dealers trading on the OTCBB may not have a bid price for
shares of our Common Stock on the OTCBB. Due to the foregoing, demand for shares
of our Common Stock on the OTCBB may be decreased or eliminated.

SHARES ELIGIBLE FOR FUTURE SALE MAY ADVERSELY AFFECT THE MARKET.

From time to time, certain of our stockholders may be eligible to sell all or
some of their shares of Common Stock by means of ordinary brokerage transactions
in the open market pursuant to Rule 144, promulgated under the Securities Act,
subject to certain limitations. In general, pursuant to Rule 144, a stockholder
(or stockholders whose shares are aggregated) who has satisfied a one-year
holding period may, under certain circumstances, sell within any three-month
period a number of securities which does not exceed the greater of 1% of the
then outstanding shares of Common Stock or the average weekly trading volume of
the class during the four calendar weeks prior to such sale. Rule 144 also
permits, under certain circumstances, the sale of securities, without any
limitation, by our stockholders that are non-affiliates that have satisfied a
two-year holding period. Any substantial sale, or cumulative sales, of our
Common Stock pursuant to Rule 144 or pursuant to any resale prospectus may have
a material adverse effect on the market price of our securities.



                                      -14-
<PAGE>

                                 USE OF PROCEEDS

      The shares which may be sold under this prospectus will be sold for the
respective accounts of each of the selling stockholders. Accordingly, we will
not realize any proceeds from the sale of the shares. We will receive proceeds
from the exercise of the options; however, no assurance can be given as to when
or if any or all of the options will be exercised. If any options are exercised,
the proceeds derived therefrom will be used for working capital and general
corporate purposes. All expenses of the registration of the shares will be paid
by us. See "Selling Stockholders" and "Plan of Distribution."

                              SELLING STOCKHOLDERS

      This prospectus relates to the shares of our common stock that are being
registered for reoffers and resales by selling stockholders who have acquired or
may acquire shares pursuant to the Plans. Offers and sales by selling
stockholders who are our "affiliates" (as such term is defined in Rule 405 under
the Securities Act) are also covered by this prospectus.

      The selling stockholders are our prior, current and future officers,
directors, employees and consultants (or any of their respective assigns) who
have acquired or may acquire in the future shares of our common stock under the
Plan. The selling stockholders may, from time to time, resell all, a portion or
none of the shares of our common stock covered by this prospectus. The following
table sets forth information as of November 30, 2007 with respect to
"beneficial" ownership (within the meaning of Rule 13d-3 under the Exchange Act)
of our common stock by each selling stockholder whose identity is known as of
the date of this prospectus. There is no assurance that any of the selling
stockholders will sell any or all of the shares offered by them under this
registration statement. The address for each executive officer, director,
employee, consultant and other selling stockholders listed below is c/o 111 Town
Square Place, Suite 1500A, Jersey City, New Jersey 07310

Any changed information will be set forth in an amendment to the registration
statement or supplement to this prospectus, to the extent required by law.


<TABLE>
<CAPTION>
                                                                                 NUMBER OF
                                                                                SHARES TO BE     NUMBER OF
                                                 NUMBER OF                       OFFERED FOR     SHARES TO   PERCENTAGE TO
                                POSITION,          SHARES        PERCENTAGE    THE ACCOUNT OF    BE OWNED          BE
                             OFFICE OR OTHER    BENEFICIALLY    BENEFICIALLY    THE SELLING        AFTER      BENEFICIALLY
                                 MATERIAL          OWNED       OWNED BEFORE      STOCKHOLDER     OFFERING     OWNED AFTER
NAME                           RELATIONSHIP       (1) (2)         OFFERING           (3)            (4)         OFFERING
----
<S>                            <C>               <C>               <C>          <C>               <C>               <C>
Agnihotri, Pankaj                  ***                 16,667        *                  16,667            0        *
Altman, Randy                       **                      0        *                  10,000            0        *
Aprigliano, Paul                    **                  8,334        *                 100,000            0        *
Bouwmans, Gregg                     **                  8,334        *                 100,000            0        *
Bianchi, Dolores                    **                108,334        *                 125,000      100,000        *
Bisker, Mark                       (5)                      0        *                 250,000            0        *
Chicoli, Raymond                    **                  5,000        *                  15,000            0        *
Chiusano, Carmine                  (6)                 35,000        *               35,000(9)            0        *
Clarke, Patrick                     **                 16,667        *                 150,000            0        *
Cohen, Robert                       **                  5,000        *                  15,000            0        *
Conti, Albert                       **                      0        *                  10,000            0        *
Dudzinski, Gregg                    **                      0        *                  30,000            0        *
Ferrante, Frank                     **                  5,000        *                  15,000            0        *
Genovesi, Arthur                    **                 43,593        *                  75,000       35,259        *
Giordano, Andrew                    **                      0        *                  15,000            0        *
Harper, David                       **                      0        *                  25,000            0        *
Hechler, Randy                      **                      0        *                  35,000            0        *
Ju, Peter                           **                 10,000        *                  30,000            0        *
Kessler, Steven                     **                381,667        *                 150,000      365,000        *

                                      -15-
<PAGE>

Landau, Joanne                     (7)                 35,000        *               35,000(9)            0        *
Lobretto, Anthony                   **                      0        *                  15,000            0        *
Minott, Daisy                       **                  9,334        *                  25,000        1,000        *
Murray, Scott                       **                 58,333        *                  25,000       50,000        *
Pasternak, Ronald                   **              1,491,666      4.00%               500,000    1,325,000      3.57%
Perez, John                         **                  2,000        *                  15,000        2,000        *
Polt, Eugene                        **                  8,334        *                 100,000            0        *
Santangelo, Mary Gurnee             **                      0        *                  35,000            0        *
Scheer, Jared                       **                      0        *                  35,000            0        *
Schmuckler, John                    **                      0        *                 250,000            0        *
Schwartz, Ronald                    **                180,000        *                 250,000      180,000        *
Schweitzer, Keith                   **                  8,333        *                  25,000            0        *
Schweitzer, Kevin                   **                 90,333        *                  25,000       82,000        *
Shelley, Jonathan                   **                  8,333        *                  25,000            0        *
Szambel, Rick                       **                  8,333        *                  25,000            0        *
Van Tongeren, Ron                   **                  5,000        *                  25,000            0        *
Vollaro, Jamie                      **                      0        *                  35,000            0        *
Weisberg, Dave                      **                263,333        *                 250,000      180,000        *
Zugschwert, Peter                  (8)                249,356        *               35,000(9)      214,356        *
</TABLE>

* Less than 1%.
** The selling stockholder is an employee or consultant of the company. *** The
selling stockholder is a former employee of the company.
(1) Represents common stock owned, vested options, and options to vest within 60
days of the date hereof.
(2) The amounts and percentages of common stock beneficially owned are reported
on the basis of regulations of the SEC governing the determination of beneficial
ownership of securities. Under the Rules of the SEC, a person is deemed to be a
"beneficial owner" of a security if that person has or shares "voting power",
which included the power to vote or direct the voting of such security, or
"investment power" which includes the power to dispose of or to direct the
disposition of such security. A person is also deemed to be a beneficial owner
of any securities of which that person as a right to acquire beneficial
ownership within 60 days, including through the exercise of options or warrants.
Under these rules, more than one person may be deemed a beneficial owner of the
same securities and a person may be deemed the beneficial owner of securities as
to which he or she has no economic interest.
(3) Includes shares underlying vested and unvested options and unvested common
stock.
(4) Represents shares of our common stock acquired by means other than through
the Plan.
(5) Mark Bisker is a member of our Board of Directors.
(6) Carmine Chiusano is a member of our Board of Directors.
(7) Joanne Landau is a member of our Board of Directors.
(8) Peter Zugschwert is a member of our board of directors
(9) These shares constitute "control securities" as such term is defined in
General Instruction C to Form S-8.


                                      -16-
<PAGE>


PLAN OF DISTRIBUTION

      In this section of the prospectus, the term "selling stockholder" means
and includes:

     o    the persons identified in the table above as the selling stockholders;

     o    those persons whose identities are not known as of the date hereof but
          may in the future be eligible to receive stock or options under the
          Plans; and any of the donees, pledgees, distributees, transferees or
          other successors in interest of those persons

     o    referenced above who may: (a) receive any of the shares of our common
          stock offered hereby after the date of this prospectus and (b) offer
          or sell those shares hereunder.

      The shares of our common stock offered by this prospectus may be sold from
time to time directly by the selling stockholders. Alternatively, the selling
stockholders may from time to time offer such shares through underwriters,
brokers, dealers, agents or other intermediaries. The selling stockholders as of
the date of this prospectus have advised us that there were no underwriting or
distribution arrangements entered into with respect to the common stock offered
hereby. The distribution of the common stock by the selling stockholders may be
effected: in one or more transactions that may take place on the OTCBB through
customary brokerage channels, either through brokers acting as agents for the
selling stockholders, or through market makers, dealers or underwriters acting
as principals who may resell these shares on the OTCBB; in privately-negotiated
sales; by a combination of such methods; or by other means. These transactions
may be effected at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at other negotiated prices. Usual
and customary or specifically negotiated brokerage fees or commissions may be
paid by the selling stockholders in connection with sales of our common stock.

      The selling stockholders may enter into hedging transactions with
broker-dealers in connection with distributions of the shares or otherwise. In
such transactions, broker-dealers may engage in short sales of the shares of our
common stock in the course of hedging the positions they assume with the selling
stockholders. The selling stockholders also may sell shares short and redeliver
the shares to close out such short positions. The selling stockholders may enter
into option or other transactions with broker-dealers which require the delivery
to the broker-dealer of shares of our common stock. The broker-dealer may then
resell or otherwise transfer such shares of common stock pursuant to this
prospectus.

      The selling stockholders also may lend or pledge shares of our common
stock to a broker-dealer. The broker-dealer may sell the shares of common stock
so lent, or upon a default the broker-dealer may sell the pledged shares of
common stock pursuant to this prospectus. Any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 may be sold under Rule
144 rather than pursuant to this prospectus.

      The selling stockholders have advised us that they have not entered into
any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their securities. There is no underwriter
or coordinating broker acting in connection with the proposed sale of shares of
common stock the selling stockholders.

      Although the shares of common stock covered by this prospectus are not
currently being underwritten, the selling stockholders or their underwriters,
brokers, dealers or other agents or other intermediaries, if any, that may
participate with the selling security holders in any offering or distribution of
common stock may be deemed "underwriters" within the meaning of the Act and any
profits realized or commissions received by them maybe deemed underwriting
compensation thereunder.

      Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of shares of the common stock offered hereby may not
simultaneously engage in market making activities with respect to the common
stock for a period of up to five days preceding such distribution. The selling
stockholders will be subject to the applicable provisions of the Exchange Act
and the rules and regulations promulgated thereunder, including without
limitation Regulation M, which provisions may limit the timing of purchases and
sales by the selling stockholders.

                                      -17-
<PAGE>


      In order to comply with certain state securities or blue sky laws and
regulations, if applicable, the common stock offered hereby will be sold in such
jurisdictions only through registered or licensed brokers or dealers. In certain
states, the common stock may not be sold unless they are registered or qualified
for sale in such state, or unless an exemption from registration or
qualification is available and is obtained.

      We will bear all costs, expenses and fees in connection with the
registration of the common stock offered hereby. However, the selling
stockholders will bear any brokerage or underwriting commissions and similar
selling expenses, if any, attributable to the sale of the shares of common stock
offered pursuant to this prospectus. We have agreed to indemnify certain of the
selling security holders against certain liabilities, including liabilities
under the Act, or to contribute to payments to which any of those security
holders may be required to make in respect thereof.

      There can be no assurance that the selling stockholders will sell any or
all of the securities offered by them hereby.

                                  LEGAL MATTERS

The Company has been named as a defendant in various routine actions that are
incidental to its activities as a broker-dealer including civil actions and
arbitration. From time to time, the Company is also involved in proceedings and
investigations by self-regulatory organizations. Although the ultimate outcome
of these matters involving the Company cannot be predicted with certainty,
management believes it has meritorious defenses to all such actions and intends
to defend each of these actions vigorously. Although there can be no assurances
that such matters will not have a material adverse effect on the results of
operations or financial condition of the Company in any future period, depending
in part on the results for such period, in the opinion of the Company's
management the ultimate resolution of such actions against the Company will have
no material adverse effect on the Company's financial condition. The validity of
the shares of our common stock being offered herein has been passed upon for us
by Ellenoff Grossman & Schole LLP of New York, New York.

                                     EXPERTS

      The financial statements as of and for each of the two years in the period
ended March 31, 2007, incorporated in this prospectus by reference from our
Annual Report on Form 10-KSB for the year ended March, 31 2007 have been audited
by Eisner LLP independent registered public accounting firm, as stated in their
report incorporated herein by reference, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.




                                      -18-
<PAGE>

                       WHERE YOU CAN FIND MORE INFORMATION

      We have filed a registration statement with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to the
shares of our common stock offered by this prospectus. This prospectus is part
of that registration statement and does not contain all the information included
in the registration statement. For further information with respect to our
common stock and us, you should refer to the registration statement, its
exhibits and the material incorporated by reference therein. Portions of the
exhibits have been omitted as permitted by the rules and regulations of the
Securities and Exchange Commission. Statements made in this prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete. In each instance, we refer you to the copy of the
contracts or other documents filed as an exhibit to the registration statement,
and these statements are hereby qualified in their entirety by reference to the
contract or document. The registration statement may be inspected and copied at
the public reference facilities maintained by the Securities and Exchange
Commission at Room 1024, Judiciary Plaza, 100 F Street, N.E., Washington, D.C.
20549 and the Regional Offices at the Commission located in the Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and at 233
Broadway, New York, New York 10279. Copies of those filings can be obtained from
the Commission's Public Reference Section, Judiciary Plaza, 100 F Fifth Street,
N.E., Washington, D.C. 20549 at prescribed rates and may also be obtained from
the web site that the Securities and Exchange Commission maintains at
http://www.sec.gov. You may also call the Commission at 1-800-SEC-0330 for more
information. We file annual, quarterly and current reports and other information
with the Securities and Exchange Commission. You may read and copy any reports,
statements or other information on file at the Commission's public reference
room in Washington, D.C. You can request copies of those documents upon payment
of a duplicating fee, by writing to the Securities and Exchange Commission.

                      DISCLOSURE OF COMMISSION POSITION ON
                  INDEMNIFICATION FOR SECURITIES LAW VIOLATIONS

      Our certificate of incorporation provides that all our directors,
officers, employees and agents shall be entitled to be indemnified by us to the
fullest extent permitted under the Delaware General Corporation Law, provided
that they acted in good faith and that they reasoned their conduct or action was
in, or not opposed to, the best interest of our company. Our Bylaws provide for
indemnification of our officers, directors and others who become a party to an
action on our behalf by us to the fullest extent not prohibited under the
Delaware General Corporation Law. Further, we maintain officer and director
liability insurance. However, insofar as indemnification for liabilities arising
under the Securities Act may be permitted to our directors, officers, and
controlling persons pursuant to the foregoing provisions or otherwise, we have
been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment of expenses incurred or paid by a director,
officer or controlling person in a successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, we will, unless in the opinion
of our counsel the matter has been settled by controlling precedent, submit to
the court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.



      YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT.
THIS DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE
INFORMATION IN THIS DOCUMENT MAY ONLY BE ACCURATE ON THE DATE OF THIS DOCUMENT.

      ADDITIONAL RISKS AND UNCERTAINTIES NOT PRESENTLY KNOWN OR THAT ARE
CURRENTLY DEEMED IMMATERIAL MAY ALSO IMPAIR OUR BUSINESS OPERATIONS. THE RISKS
AND UNCERTAINTIES DESCRIBED IN THIS DOCUMENT AND OTHER RISKS AND UNCERTAINTIES
WHICH WE MAY FACE IN THE FUTURE WILL HAVE A GREATE IMPACT ON THOSE WHO PURCHASE
OUR COMMON STOCK. THESE PURCHASERS WILL PURCHASE OUR COMMON STOCK AT THE MARKET
PRICE OR AT A PRIVATELY NEGOTIATED PRICE AND WILL RUN THE RISK OF LOSING THEIR
ENTIRE INVESTMENT.


                                      -19-
<PAGE>





                           HUDSON HOLDING CORPORATION

                                12,000,000 SHARES
                                  COMMON STOCK


--------------------------------------------------------------------------------




                                   PROSPECTUS


--------------------------------------------------------------------------------




                                DECEMBER 3, 2007

<PAGE>


--------------------------------------------------------------------------------



                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 3.     INCORPORATION OF DOCUMENTS BY REFERENCE

      Included in the prospectus which is part of this registration statement.

ITEM 4.     DESCRIPTION OF SECURITIES

      Included in the prospectus which is part of this registration statement.

ITEM 5.     INTERESTS OF NAMED EXPERTS AND COUNSEL.

      N/A.

ITEM 6.     INDEMNIFICATION OF OFFICERS AND DIRECTORS.

      Our certificate of incorporation provides that all our directors,
officers, employees and agents shall be entitled to be indemnified by us to the
fullest extent permitted under the Delaware General Corporation Law, provided
that they acted in good faith and that they reasoned their conduct or action was
in, or not opposed to, the best interest of our company.

      Our Bylaws provide for indemnification of our officers, directors and
others who become a party to an action on our behalf by us to the fullest extent
not prohibited under the Delaware General Corporation Law. Further, we maintain
officer and director liability insurance.

      Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us pursuant
to the foregoing provisions, we have been informed that in the opinion of the
Commission such indemnification is against public policy as expressed in the Act
and is therefore unenforceable.

ITEM 7.     EXEMPTION FROM REGISTRATION CLAIMED.

      All shares of common stock registered hereunder for reoffer or resale will
be granted, or issued upon exercise of options granted or to be granted,
pursuant to the Plans. The options are non-transferable. Options granted as of
the date hereof as well as shares of common stock issued upon the exercise of
such options were granted or issued in transactions not involving a public
offering. Upon exercise of an option, the optionee was required to execute an
undertaking not to resell such shares except pursuant to an effective
registration statement or other exemption under the Securities Act, a
restrictive legend is placed on the certificates for the shares of common stock
purchased and transfer stops are placed against such certificates. Such shares
may only be reoffered and sold pursuant to registration under the Act or
pursuant to an applicable exemption under the Act. As a result, such offers and
sales are exempt from the registration requirements of the Act pursuant to the
provisions of Section 4(2) of the Act.

ITEM 8.     EXHIBITS.

      The following exhibits are filed with this Registration statement.

NUMBER       DESCRIPTION
--------     -------------------------------------------------------------------
  4.1        Registrant's 2005 Stock Option Plan(1)
  4.2        Registrant's 2007 Long-Term Incentive Compensation Plan(2)
  5.1        Opinion of Ellenoff Grossman & Schole LLP*
 23.1        Consent of Ellenoff Grossman & Schole LLP (contained in
             Exhibit 5.1)*
 23.2        Consent of Eisner, LLP*

(1) Filed as part of the Company's 2005 Schedule 14A.
(2) Filed as part of the Company's 2007 Schedule 14A.
*   Filed herewith.

                                      -21-
<PAGE>



ITEM 9. UNDERTAKINGS.

(a) The undersigned registrant hereby undertakes:

       (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement.

            (i) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.

      (2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
anew registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bonafide offering thereof.

      (3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

      (4) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within the
meaning of Rule 145(c), such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.

      (5) That every prospectus (i) that is filed pursuant to paragraph (4)
immediately preceding, or (ii) that purports to meet the requirements of Section
10(a)(3) of the Securities Act of 1933 and is used in connection with an
offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

      (6) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bonafide offering thereof.

      (7) To respond to requests for information that is incorporated by
reference into the joint proxy statement/prospectus pursuant to Item 4, 10(b),
11or 13 of this form, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to the
effective date of the registration statement through the date of responding to
the request.

      (8) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective.

(b) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

(c) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.



                                      -22-
<PAGE>

                                   SIGNATURES


THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, there unto
duly authorized, in the City of Jersey City, State of New Jersey, on December 3,
2007.


                                     HUDSON HOLDING CORPORATION

                                     By: /s/ Martin C. Cunningham
                                     ----------------------------
                                     Name:  Martin C. Cunningham
                                     Title: Chairman and Chief Executive Officer

      Hudson Holding Corporation and each of the undersigned do hereby appoint
Marty Cunningham and Keith Knox and each of them severally, its or his true and
lawful attorney to execute on behalf of Hudson Holding Corp. and the undersigned
any and all amendments to this Registration Statement on Form S-8 and to file
the same with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission; each of such persons shall have the
power to act hereunder with or without the other.

      In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates stated.

 Signatures                       Title                              Date
 ----------                       -----                              ----

                           Chairman of the Board,               December 3, 2007
/s/ Martin C. Cunningham   Chief Executive Officer and
------------------------   Director (principal executive officer)
Martin C. Cunningham

/s/ Keith R. Knox          President, Secretary and Director    December 3, 2007
-----------------------    (principal financial and accounting
Keith R. Knox              officer)

/s/ Mark Leventhal         Executive Vice President             December 3, 2007
-----------------------    and Director
Mark Leventhal

/s/ Peter J. Zugschwert    Director                             December 3, 2007
------------------------
Peter J. Zugschwert

/s/ Joanne V. Landau       Director                             December 3, 2007
------------------------
Joanne V. Landau

/s/ Carmine V. Chiusano    Director                             December 3, 2007
------------------------
Carmine V. Chiusano

                           Director                             December 3, 2007
------------------------
Mark Bisker




                                      S-1
[{"type": "S-8", "sequence": "1", "filename": "t303861.txt", "secsgml_size_bytes": 110131}]
{"company-data": {"conformed-name": "HUDSON HOLDING CORP", "cik": "0000804157", "assigned-sic": "6211", "irs-number": "411546471", "state-of-incorporation": "DE", "fiscal-year-end": "0331"}, "filing-values": {"form-type": "S-8", "act": "33", "file-number": "333-147795", "film-number": "071281202"}, "business-address": {"street1": "111 TOWN SQUARE PLACE,", "street2": "SUITE 1500A", "city": "JERSEY CITY", "state": "NJ", "zip": "07310", "phone": "201-216-0100"}, "mail-address": {"street1": "111 TOWN SQUARE PLACE,", "street2": "SUITE 1500A", "city": "JERSEY CITY", "state": "NJ", "zip": "07310"}, "former-company": [{"former-conformed-name": "HEALTH OUTCOMES MANAGEMENT INC", "date-changed": "19951116"}, {"former-conformed-name": "DATA MED CLINICAL SUPPORT SERVICES INC /MN/", "date-changed": "19920703"}]}
AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON DECEMBER 3, 2007

                                                           REGISTRATION NO. 333-

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    FORM S-8
                          REGISTRATION STATEMENT UNDER
                           THE SECURITIES ACT OF 1933

                           HUDSON HOLDING CORPORATION
               (EXACT NAME OF REGISTRANT AS SPECIFIED IN CHARTER)

                                    Delaware
            (STATE OR JURISDICTION OF INCORPORATION OR ORGANIZATION)

                                   20-3766053
                      (I.R.S. EMPLOYER IDENTIFICATION NO.)

                       111 Town Square Place, Suite 1500A
                          Jersey City, New Jersey 07310
                                 (201) 216-0100
               (ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
        INCLUDING AREA CODE, OF REGISTRANT'S PRINCIPAL EXECUTIVE OFFICES)

                             2005 Stock Option Plan
                   2007 Long-Term Incentive Compensation Plan
                             (FULL TITLES OF PLANS)

                                Martin Cunningham
                       111 Town Square Place, Suite 1500A
                          Jersey City, New Jersey 07310
                                 (201) 216-0100
            (NAME, ADDRESS, INCLUDING ZIP CODE, AND TELEPHONE NUMBER,
                   INCLUDING AREA CODE, OF AGENT FOR SERVICE)

                                   COPIES TO:

                              David Selengut, Esq.
                         Ellenoff Grossman & Schole LLP
                        370 Lexington Avenue, 19th Floor
                            New York, New York 10017
                                 (212) 370-1300
                               Fax: (212) 370-7889
CALCULATION OF REGISTRATION FEE

---------------------------------------------------------------------------------------------------------------------
                                                                      PROPOSED
                                                                      MAXIMUM    PROPOSED MAXIMUM
             TITLE OF EACH CLASS                                      OFFERING       AGGREGATE
                OF SECURITIES                     AMOUNT TO BE         PRICE         OFFERING          AMOUNT OF
              TO BE REGISTERED                    REGISTERED(1)     PER UNIT(2)        PRICE       REGISTRATION FEE
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,        110,000 shares     $0.35(2)(a)     $38,500.00           $1.51
underlying options...........................
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     75,000 shares     $0.40(2)(a)     $30,000.00           $1.18
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    305,000 shares     $0.49(2)(a)     $149,450.00          $5.87
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    250,000 shares     $0.80(2)(a)     $200,000.00          $7.86
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    475,000 shares     $0.90(2)(a)     $427,500.00         $16.80
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................    725,000 shares     $1.00(2)(a)     $725,000.00         $28.49
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     30,000 shares     $1.15(2)(a)     $34,500.00           $1.36
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share,
underlying options...........................     66,667 shares     $1.46(2)(a)     $97,333.82           $3.83
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
common stock, par value $0.001 per share.....   9,963,333 shares    $0.28(2)(b)    $2,789,733.20        $109.64
---------------------------------------------------------------------------------------------------------------------
---------------------------------------------------------------------------------------------------------------------
Total                                           12,000,000 shares       n/a        $4,492,017.02        $176.54
---------------------------------------------------------------------------------------------------------------------
(1)  The aggregate amount of securities registered hereunder is 12,000,000
     shares of common stock issuable upon the exercise of options which may be
     granted or common stock otherwise grantable pursuant to our 2005 Stock
     Option Plan (2,000,000 shares of common stock authorized) and our 2007
     Long-Term Incentive Compensation Plan (10,000,000 shares of common stock
     authorized). Pursuant to Rule 416 promulgated under the Securities Act of
     1933, as amended, this Registration Statement covers such indeterminate
     additional shares of common stock to be offered or issued to prevent
     dilution as a result of future stock splits, stock dividends, or other
     similar transactions.

(2)  The offering price has been estimated solely for the purposes of the
     calculation of the registration fee. The offering price has been calculated
     in accordance with the manner described in paragraphs (h) and (c) of Rule
     457 in the following manner:

         (a)      to the extent the exercise price of the options for which the
                  underlying shares reoffered by this prospectus is known, the
                  offering price is based upon the applicable exercise price; or

         (b)      to the extent the exercise price of the options for which the
                  underlying shares, or the grant price of the shares, reoffered
                  by this prospectus is unknown, the offering price is based
                  upon the average of high and low prices reported by the OTC
                  Bulletin Board on November 27, 2007 a date within five (5)
                  business days prior to the date of the filing of this
                  registration statement.

                                       i
EXPLANATORY NOTE

      This registration statement on Form S-8 of Hudson Holding Corporation
(this "Registration Statement") has been prepared in accordance with the
requirements of Form S-8 under the Securities Act of 1933, as amended (the
"Securities Act") to register up to 12,000,000 shares of our common stock, par
value $0.001 per share (the "Common Stock"), to be issued to participants in
each of our 2005 Stock Option Plan and our 2007 Long-Term Incentive Compensation
Plan (collectively, the "Plans").

      This Registration Statement includes the registration for reoffer and
resale of up to 9,963,333 shares of our Common Stock that may be acquired in the
future under this Registration Statement by participants in the Plans who are
our "affiliates" as such term is defined in Rule 405 under the Securities Act of
1933, which shares constitute "control securities" as such term is defined in
General Instruction C to Form S-8.

      The materials that follow Part I and precede Part II of this Registration
Statement constitute a reoffer prospectus. The reoffer prospectus filed as part
of this Registration Statement on Form S-8 has been prepared in accordance with
the requirements of Part I of Form S-3 and in accordance with General
Instruction C of Form S-8.

                                     PART I

              INFORMATION REQUIRED IN THE SECTION 10(A) PROSPECTUS

ITEM 1. PLAN INFORMATION.*

ITEM 2. REGISTRANT INFORMATION AND EMPLOYEE PLAN ANNUAL INFORMATION.*

* Information required by Part I to be contained in the Section 10(a) Prospectus
is omitted from the Registration Statement in accordance with Rule 428 under the
Securities Act of 1933, as amended.

                                       ii
REOFFER PROSPECTUS

                           HUDSON HOLDING CORPORATION

                                12,000,000 SHARES
                                  COMMON STOCK

      This prospectus is being used in connection with the offering from time to
time by certain selling stockholders of our company or their successors in
interest of shares of the common stock issued or to be issued, or which may be
acquired upon the exercise of stock options issued or to be issued, pursuant to
our 2005 Stock Option Plan and our 2007 Long-Term Incentive Compensation Plan,
which we refer to herein collectively as the Plans.

      The common stock may be sold from time to time by the selling stockholders
or by their pledgees, donees, transferees or other successors in interest. Such
sales may be made in the over-the-counter market or otherwise at prices and at
terms then prevailing or at prices related to the then current market price, or
in negotiated transactions. The common stock may be sold by one or more of the
following: (a) block trades in which the broker or dealer so engaged will
attempt to sell the shares as agent but may position and resell portions of the
block as principal to facilitate the transaction; (b) purchases by a broker or
dealer as principal and resale by such broker or dealer for its account pursuant
to this prospectus; (c) an exchange distribution in accordance with the rules of
such exchange; and (d) ordinary brokerage transactions and transactions in which
the broker solicits purchases. In effecting sales, brokers or dealers engaged by
the selling stockholders may arrange for other brokers or dealers to
participate. Brokers or dealers may receive commissions or discounts from
selling stockholders in amounts to be negotiated immediately prior to the sale.
Such brokers or dealers and any other participating brokers or dealers may be
deemed to be "underwriters" within the meaning of the Securities Act of 1933, as
amended, or the Act, in connection with such sales. In addition, any securities
covered by this prospectus which qualify for sale pursuant to Rule 144 may be
sold under Rule 144 rather than pursuant to this prospectus. We will not receive
any of the proceeds from the sale of these shares; however, we will receive
proceeds from the exercise of our options. There is no guarantee that our
options will be exercised, but any proceeds received therefrom will be used for
general corporate purposes. We will pay the expenses of preparing this
prospectus and the related registration statement.

      Our common stock is quoted on the Over the Counter Bulletin Board
("OTCBB") under the symbol "HDHL.OB". On November 27, 2007, the closing sales
price for the common stock on the OTCBB was $0.28 per share.

Our principal executive offices are located at 111 Town Square Place, Suite
1500A, Jersey City, New Jersey 07310; Attention: Marty Cunningham. Our telephone
number is (201) 216-0100

      AN INVESTMENT IN THE SHARES OF OUR COMMON STOCK BEING OFFERED BY THIS
PROSPECTUS INVOLVES A HIGH DEGREE OF RISK. YOU SHOULD READ THE "RISK FACTORS"
SECTION BEGINNING ON PAGE 8 BEFORE YOU DECIDE TO PURCHASE ANY SHARES OF OUR
COMMON STOCK.

      NEITHER THE SECURITIES AND EXCHANGE COMMISSION NOR ANY STATE SECURITIES
COMMISSION HAS APPROVED OR DISAPPROVED OF THESE SECURITIES OR PASSED UPON THE
ADEQUACY OR ACCURACY OF THE PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A
CRIMINAL OFFENSE.

                THE DATE OF THIS PROSPECTUS IS DECEMBER 3, 2007.

                                      iii
--------------------------------------------------------------------------------

                                TABLE OF CONTENTS

NOTE ON FORWARD LOOKING STATEMENTS.............................................1
INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE................................1
PROSPECTUS SUMMARY.............................................................2
THE OFFERING...................................................................7
RISK FACTORS...................................................................8
USE OF PROCEEDS...............................................................15
SELLING STOCKHOLDERS..........................................................15
PLAN OF DISTRIBUTION..........................................................17
LEGAL MATTERS.................................................................18
EXPERTS.......................................................................18
WHERE YOU CAN FIND MORE INFORMATION...........................................19
DISCLOSURE OF COMMISSION POSITION ON INDEMNIFICATION
  FOR SECURITIES LAW VIOLATIONS...............................................19

      You should rely only upon the information contained in this prospectus and
the registration statement of which this prospectus is a part. We have not
authorized any other person to provide you with different information. If anyone
provides you with different or inconsistent information, you should not rely on
it. We are not making an offer to sell these securities in any jurisdiction
where the offer or sale is not permitted. You should assume the information
appearing in this prospectus is accurate only as of the date on the front cover
of this prospectus. Our business, financial condition, results of operations and
prospects may have changed since that date. This prospectus is based on
information provided by us and other sources that we believe are reliable. We
have summarized certain documents and other information in a manner we believe
to be accurate, but we refer you to the actual documents for a more complete
understanding of what we discuss in this prospectus. In making an investment
decision, you must rely on your own examination of our business and the terms of
the offering, including the merits and risks involved.

      We obtained statistical data, market data and other industry data and
forecasts used throughout, or incorporated by reference in, this prospectus from
market research, publicly available information and industry publications.
Industry publications generally state that they obtain their information from
sources that they believe to be reliable, but they do not guarantee the accuracy
and completeness of the information. Similarly, while we believe that the
statistical data, industry data and forecasts and market research are reliable,
we have not independently verified the data, and we do not make any
representation as to the accuracy of the information. We have not sought the
consent of the sources to refer to their reports appearing or incorporated by
reference in this prospectus.

      This prospectus contains, or incorporates by reference, trademarks,
tradenames, service marks and service names of Hudson Holding Corporation and
other companies.

                                       iv
NOTE ON FORWARD LOOKING STATEMENTS

         Certain statements contained in this prospectus constitute
"forward-looking statements" as that term is defined under the Private
Securities Litigation Reform Act of 1995 and releases issued by the SEC and
within the meaning of Section 27A of the Securities Act and Section 21E of the
Securities Exchange Act of 1934, as amended, (the "Exchange Act"). The words
"believe," "expect," "anticipate," "intend," "estimate," "plan" and other
expressions which are predictions of or indicate future events and trends and
which do not relate to historical matters identify forward-looking statements.
Reliance should not be placed on forward-looking statements because they involve
known and unknown risks, uncertainties and other factors, which may cause our
actual results, performance or achievements to differ materially from
anticipated future results, performance or achievements expressed or implied by
such forward-looking statements. Factors that could cause actual results to
differ materially from those expressed or implied by such forward-looking
statements include, but are not limited to: (a) our projected revenues and
profitability, (b) our growth strategies, (c) anticipated trends in our
industry, (d) our future financing plans and (e) our anticipated needs for
working capital.

         The foregoing does not represent an exhaustive list of risks. Please
see "Risk Factors" for additional risks which could adversely impact our
business and financial performance. Moreover, new risks emerge from time to time
and it is not possible for our management to predict all risks, nor can we
assess the impact of all risks on our business or the extent to which any risk,
or combination of risks, may cause actual results to differ from those contained
in any forward-looking statements. All forward-looking statements included in
this prospectus are based on information available to us on the date of this
prospectus. Except to the extent required by applicable laws or rules, we
undertake no obligation to publicly update or revise any forward-looking
statement, whether as a result of new information, future events or otherwise.
All subsequent written and oral forward-looking statements attributable to us or
persons acting on our behalf are expressly qualified in their entirety by the
cautionary statements contained throughout this prospectus.

                 INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

         The following documents, heretofore filed by us with the U.S.
Securities and Exchange Commission pursuant to the Securities Exchange Act of
1934, as amended, are hereby incorporated by reference, except as superseded or
modified herein:

     1    Our Annual Report on Form 10-KSB for the fiscal year ended March 31,
          2007, filed on June 29, 2007;
     2.   Our Definitive Proxy Statement on Form 14A, filed on July 20, 2007;
     3.   Our Quarterly Report on Form 10-QSB for the quarterly period ended
          June 30, 2007, filed on August 13, 2007;
     4.   Our Current Report on Form 8-K, filed on October 3, 2007;
     5.   Our Quarterly Report on Form 10-QSB for the quarterly period ended
          September 30, 2007, filed on November 14, 2007.
     6.   The description of our common stock contained in our Registration
          Statement on Form SB-2 filed on March 28, 2007.

         All documents filed by the registrant after the date of filing the
initial registration statement on Form S-8 of which this prospectus forms a part
and prior to the effectiveness of such registration statement pursuant to
Section 13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934 shall
be deemed to be incorporated by reference into this prospectus and to be part
hereof from the date of filing of such documents.

         We will provide without charge to each person to whom a copy of this
prospectus is delivered, upon the written or oral request of any such person, a
copy of any document described above (other than exhibits). Requests for such
copies should be directed to Hudson Holding Corporation, 111 Town Square Place,
Suite 1500A, Jersey City, New Jersey 07310; Attention: Marty Cunningham.

         You should rely only on the information incorporated by reference or
provided in this prospectus or any prospectus supplement. We have not authorized
anyone else to provide you with different information. You should not assume
that the information in this prospectus or any prospectus supplement is accurate
as of any date other than the date on the front page of those documents.

                                      -1-
PROSPECTUS SUMMARY

      THE FOLLOWING SUMMARY HIGHLIGHTS SELECTED INFORMATION CONTAINED IN THIS
PROSPECTUS. THIS SUMMARY DOES NOT CONTAIN ALL OF THE INFORMATION YOU SHOULD
CONSIDER BEFORE INVESTING IN THE SECURITIES. BEFORE MAKING AN INVESTMENT
DECISION, YOU SHOULD READ THE ENTIRE PROSPECTUS CAREFULLY, INCLUDING THE RISK
FACTORS SECTION AS WELL AS THE FINANCIAL STATEMENTS AND THE NOTES TO THE
FINANCIAL STATEMENTS INCORPORATED HEREIN BY REFERENCE. IN THIS PROSPECTUS AND
ANY AMENDMENT OR SUPPLEMENT HERETO, UNLESS OTHERWISE INDICATED, THE TERMS
"HUDSON HOLDING CORPORATION", THE "COMPANY", "WE", "US", AND "OUR" REFER AND
RELATE TO HUDSON HOLDING CORPORATION AND ITS CONSOLIDATED SUBSIDIARIES.

GENERAL

Hudson Holding Corporation ("Holding") is a holding company and is the parent of
its wholly owned subsidiaries, namely Hudson Securities, Inc. ("Hudson") and
Hudson Technologies, Inc. ("HTI"), (collectively the "Company"). Hudson is a
registered broker-dealer under the Securities Exchange Act of 1934 and is a
member of the Financial Industry Regulatory Authority ("FINRA"). The Company has
offices in New Jersey and Florida. HTI was formed for the purpose of providing
software development and technology services for Hudson and for third parties.

On June 30, 2004, Hudson's current management team consummated the purchase of
all of the outstanding shares of the predecessor broker-dealer's common stock.
Subsequently, on July 21, 2004, the predecessor broker-dealer formed a wholly
owned subsidiary named Hudson Capital Markets, Inc. ("HCMI"), which was
organized in the state of Delaware. On July 31, 2004, the predecessor
broker-dealer was merged into HCMI, with HCMI becoming the survivor ("HCMI
Merger") and the name was changed to Hudson Securities, Inc.

In December 2004, Hudson entered into an Agreement and Plan of Merger (the
"Agreement") with Health Outcomes Management, Inc. ("HOM"), a non-operating
public company. On May 3, 2005, under the terms of the Agreement, Hudson's
stockholders exchanged all of their shares of common stock and warrants for
shares of HOM common stock (the "Exchange"). The HOM shares that were issued to
Hudson stockholders in the merger represented 94% of HOM's outstanding interest
at the time of this exchange. In connection with the legal form of this
transaction, Hudson became a wholly owned subsidiary of HOM. On September 6,
2005, HOM changed its name to Hudson Holding Corporation and effectuated a one
for eight reverse stock split for all stockholders of record as of the close of
business on June 13, 2005. For financial reporting purposes, the Exchange
represents a capital transaction of Hudson or a "reverse merger" rather than a
business combination.

OPERATIONS

Hudson is a member of FINRA and is insured by the Securities Investor Protection
Corporation. Hudson is a market maker trading more than 9,000 NASDAQ, non-NASDAQ
OTC, listed and foreign securities, and specializes in providing liquidity in
less liquid, difficult to trade stocks. Hudson has been in business since 1984.

As a market maker, Hudson provides its customers with order executions. When
customers come to Hudson seeking to buy or sell securities, the firm works to
satisfy the customers' needs, either by finding counterparties willing to trade
with the customers (obtaining liquidity) or, where appropriate, by taking the
other side of the trades, thereby providing liquidity for its customers by
purchasing or selling the securities itself. In a sense, liquidity is the
product that Hudson sells to its customers.

Hudson's customers are firms that require liquidity to complete stock trades,
funds whose investment decisions call for shifts into or out of certain stocks,
retail customers, professional traders who want to establish or liquidate their
positions, and other retail brokerage firms whose individual investor clients
wish to buy or sell securities. By trading with Hudson, its customers are able
to obtain liquidity.

Providing trade executions generates two types of revenue for Hudson, commission
revenue and trading revenue.

Commission revenue comes from the fees that Hudson charges its customers for
executing their orders, generally a fixed price per share traded. Revenue may
vary with the number and size of Hudson's customers and with their level of
trading activity. Commission revenue is free of market risk for Hudson since
Hudson acts as an agent and does not take any proprietary security positions.

                                      -2-
Trading revenue is derived from the profit and loss associated with purchases
and sales of securities for Hudson's trading account, for securities in which
Hudson makes markets. In doing so, the firm itself is at risk to changes in
stock prices. Trading profits are obtained by paying less to buy shares for its
own account than the firm receives for selling those shares. Because the price
for which the firm is willing to purchase shares (its "bid" price) is always
less than the price at which it would then sell those shares (its "ask" price),
trading with a customer presents a market maker with an opportunity to capture
the difference between these prices (the "bid-ask spread") provided it can find
a contra-party with whom to trade in the same security before the stock price
moves against the trader. Finding a counter party to take the other side of a
trade can be challenging, and failure to find a counter party at the right price
or time can lead to a loss.

COMPETITIVE ADVANTAGES

Hudson believes that it differentiates itself by the stocks it trades and by the
customers it serves. While many of the firm's competitors emphasize NASDAQ
National Market stocks, Hudson focuses on providing liquidity in
difficult-to-trade stocks, including shares quoted on the OTC Bulletin Board and
Pink Sheets and second tier and Small-Cap NASDAQ stocks. Hudson's strategy is to
maintain and grow existing relationships with retail firms while seeking to
attract new customers from among other retailers that the firm's competitors
neglect as well as targeted insitutions.

TECHNOLOGY

Hudson maintains a multi-tier connectivity network to receive customers' orders,
to monitor the markets, and to communicate with trading partners. Hudson's
traders have the ability to trade all U.S. equities, using Sungard's BRASS order
management system to process incoming orders and its UMA market access system
and the NASDAQ Level III system to enter orders. These systems interface with
Goldman Sachs Execution & Clearing, L.P. (Hudson's clearing broker) to ensure
trades are processed. The firm's Jersey City, Tinton Falls and Boca Raton
offices are in constant communication and can serve as back-up for one another
in case of system failures.

Hudson has migrated to Sungard's "dedicated complex" on which Hudson can run its
BRASS servers. The facility is capable of executing trades at peak rates of
approximately triple the previous average rate. Its complete implementation has
allowed Sungard to be more responsive to Hudson's needs, provided the ability to
make changes to the system during trading hours, and facilitated the addition of
a dedicated FIX-protocol communications server, which simplified the setup of
new customer connections.

HTI is a hardware and software technology division of Hudson Holding
Corporation. HTI creates and develops software to enhance the trading
environment of Hudson Securities and to meet customers' needs for customized
services. To date, HTI has created applications that advance the base
functionality of BRASS, a Sungard Order Management System. The profit and loss
system developed by HTI is a tool for equities sales traders of Hudson
Securities which on a nightly basis calculates what they have earned based on
their customer order flow. The system also creates a management report, as well
as several other customer reports to enhance the value of Hudson Securities to
its clients. To the extent that these programs may be useful for other brokerage
firms, HTI may sell or license these programs to others.

HTI, through its value added vendor relationships, has created several modules
using the BRASS OAPI, (an open OPI which allows Hudson to write code to the
application) which will be able to provide added functionality for the traders
of Hudson Securities. HTI also operates a carrier neutral co-location data
center where customers can rent cabinets, paying HTI a monthly fee. HTI also
generates revenues by providing co-location customers with remote hands support.

                                      -3-
FUTURE PRODUCTS AND SERVICES

Hudson is actively seeking to expand into complementary businesses, both by
developing new product/service offerings that will be valuable to the firm's
existing customers and by entering into strategic partnerships with related
businesses that can increase its number of new customers. There can be no
assurance that we will meet our goal. Strategic partnership candidates include
boutique investment banking and money management firms. It may be necessary to
acquire new businesses or hire experienced personnel to effectuate expansion
plans in these areas.

THE MARKET

Hudson focuses on attracting orders from retail brokerage firms and buy-side
institutions, such as mutual funds, hedge funds and trusts.

Market makers' main customers are retail brokers and institutions that require
order executions for varieties of stocks, from widely traded issues, like those
of S&P 500 and NASDAQ 100 companies, to less liquid securities such as NASDAQ
Small-Cap, Bulletin Board, and Pink Sheet stocks.

While offering liquidity across a broad range of stocks to both institutional
and retail brokerage customers, Hudson intends to focus its resources on
increasing the firm's market share as a liquidity provider to retail brokerage
firms and institutions, plus on specializing in less liquid issues.

Management believes that retail order-entry firms are being neglected in the
increasing competition among market makers for institutional customers, offering
the firm an opportunity to increase its presence in that segment. Meanwhile,
particularly as large competitors decrease their commitment to the market making
business in light of recent "lean years," lucrative retail brokerage customers
may be interested in investigating alternative relationships, presenting Hudson
with an opportunity to attract such customers. By establishing a large pool of
retail orders, management believes that the firm will ultimately be better
positioned to attract buy-side institutional firms in search of liquidity.

By focusing on less liquid stocks, the firm avoids some of the fiercest
competition among market makers and other liquidity providers such as Electronic
Crossing/Communication Networks (ECN's). At the same time, Hudson provides a
less available service, finding a firm willing to fill an order for little-known
pink sheet stocks. However, trading less liquid issues exposes firms to greater
price volatility and thus greater risk. There is less investor interest in
trading such securities, but the wider spreads have greater profit potential.
Hudson trades many of the most active NASDAQ National Market stocks, and by
focusing on smaller issues management hopes to appeal to retail brokers in need
of liquidity while maximizing the firm's profit potential.

INDUSTRY ANALYSIS

Historically, a handful of market makers have accounted for most of the shares
traded on the NASDAQ, OTC Bulletin Board and Pink Sheets. Retail brokers and
institutions prefer to have relationships with (and communication links to) more
than one market-maker. This engenders competition among market makers, inducing
them to offer fast executions, favorable prices, payment for order flow,
liquidity, research, convenience, and trustworthiness.

INDUSTRY PARTICIPANTS

Over the last several years there has been a rapid consolidation in the market
making industry, as global financial corporations that entered the business near
the height of the market in the late 1990's subsequently scaled back, as the
market (and trading volumes and profits) retreated. While 200+ "market makers"
are currently registered to trade bulletin board stocks*, we believe that many
choose to register as market makers for technical reasons, and only a handful of
these firms (including Hudson) actively compete to fill orders from retail
brokers' customers. Historically, two of the largest market makers, Knight
Equity Markets and UBS Securities, dominate the market, accounting for a
majority of NASDAQ, OTC Bulletin Board and Pink Sheet volume.

*according to http://www.otcbb.com/dynamic/tradingdata/MarketMakersPositions/
MMakersdata.htm

                                      -4-
COMPETITION

Market making can be viewed by some as a commodity business, with participants
all offering prompt executions of customer orders. But in an industry where
everyone sells (or buys) identical shares of stock, there are criteria whereby
market makers manage to distinguish themselves from their competition. Factors
on which market makers compete include execution quality (speed and price),
payment for orderflow, securities traded and available liquidity, research,
service, ease of use and relationships.

Many of our competitors have greater financial, technical and personnel
resources than Hudson. We compete with over 200 market makers, and specifically
with Knight Trading Group and UBS Securities, two of the largest market makers.
Our ability to continue to compete with other market makers will depend on our
financial resources, trading ability, and our ability to provide other
complementary services to our clients.

To help attract new customers, the firm is striving to increase the list of
securities available for trading. Since the beginning of 2003, Hudson began
making markets in additional NASDAQ stocks. In addition, the firm now trades
securities which are listed on certain US and foreign exchanges. Management is
committed to expanding the list even more going forward, particularly with the
future deployment of the firm's automated trading system.

FUTURE GROWTH

In addition to growing its market making business, the firm also intends to
enter other (related) business lines, as discussed below. Management believes
that entering other related businesses will help reduce earnings fluctuations.
In addition, management hopes that the introduction of related business lines
will help the firm to attract new customers to its market making business. The
firm intends to pursue both organic growth and acquisitions to meet this goal,
although there can be no assurance that management will meet these goals.

Furthermore, management is considering building a retail brokerage business
driven by independent sales representatives. The firm would offer brokerage
business necessities (office space, trading and clearing systems, statement
generation) to retail brokers who prefer not to work in the traditional
brokerage environment. Brokers would be allowed wide latitude in deciding how to
best service their customers (subject to relevant industry rules). With such a
division, in addition to adding a potentially profitable business, Hudson
believes it would effectively create a new customer for its market making
services.

GOVERNMENT REGULATION

The securities industry in the United States is subject to extensive regulation
under both federal and state laws. Hudson is registered as a broker-dealer with
the SEC and certain state securities divisions. Much of the regulation of
broker-dealers has been delegated to self-regulated organizations, principally
FINRA, Nasdaq and national securities exchanges. These self-regulatory
organizations adopt rules (subject to approval by the SEC) that govern the
industry and conduct regular and periodic examinations of our operations.
Securities firms are also subject to regulation by state securities
administrators in those states in which they conduct business. The Company is
also subject to oversight by the U.S. Department of Labor in connection with our
benefit plans.

Significant legislation, rule-making and market structure changes have occurred
over the last five years that have had an impact on the Company. First,
decimalization was introduced in January 2001 in NYSE and AMEX listed
securities, and in Nasdaq markets in April 2001. Decimalization, combined with
the one-penny minimum price increment, has had a dramatic reduction in average
spreads, which in turn has had a profound effect on our profitability. Second,
in 2002 Nasdaq launched SuperMontage, a Nasdaq routing and execution system.
SuperMontage transformed Nasdaq from a quote-driven market to a
full-order-driven market as quotes and orders are treated the same. Under
SuperMontage, market makers and ECNs are able to show trading interest at five
different price levels, allowing investors to see individual and aggregated
interest across all market participants at the National Best Bid or Offer
("NBBO") and four additional layers above or below the NBBO. Third, the
introduction of SuperMontage, which is not used by all market participants, and
the increase in trading of Nasdaq-listed securities by other exchanges has
created market fragmentation. This lack of linkage between market centers has
resulted in an increase in locked and crossed markets, fragmented liquidity
pools and different market centers using different sets of regulatory rules and
regulations. Fourth, the U.S. Patriot Act of 2001, enacted in response to the
terrorist attacks on September 11, 2001, contains anti-money laundering and
financial transparency laws and mandates the implementation of various new
regulations applicable to broker-dealers and other financial services companies,
including standards for verifying client identification at account opening, and
obligations to monitor client transactions and report suspicious activities. The
increased obligations of financial institutions to identify their customers,

                                      -5-
watch for and report suspicious transactions, respond to requests for
information by regulatory authorities and law enforcement agencies, and to share
information with other financial institutions, requires the implementation and
maintenance of internal practices, procedures and controls which will increase
our costs and may subject us to regulatory inquiries, claims or penalties.
Lastly, the Sarbanes-Oxley Act of 2002 has led to sweeping changes in corporate
governance. This far reaching legislation has significantly affected public
companies by enacting provisions covering corporate governance, board of
directors and audit committee structure, management and control structure, new
disclosure requirements, oversight of the accounting profession and auditor
independence. The SEC also responded by, among other things, requiring chief
executive officers and chief financial officers of public companies to certify
the accuracy of certain financial reports and certain other SEC filings.

The regulatory environment in which we operate is subject to constant change.
Our business, financial condition and operating results may be adversely
affected as a result of new or revised legislation or regulations imposed by the
U.S. Congress, the SEC, other U.S. and state governmental regulatory
authorities, or FINRA. Our business, financial condition and operating results
also may be adversely affected by changes in the interpretation or enforcement
of existing laws and rules by these governmental authorities.

Additional regulation, changes in existing laws and rules, or changes in
interpretations or enforcement of existing laws and rules often directly affect
the method of operation and profitability of regulated broker-dealers.

FINRA AND NET CAPITAL REQUIREMENTS

Regulatory bodies, including FINRA, are charged with safeguarding the integrity
of the securities industry and with protecting the interests of investors
participating in those markets. Broker-dealers are subject to regulations
covering all aspects of the securities business, including sales methods, trade
practices among broker-dealers, use and safekeeping of clients' funds and
securities, capital structure, record keeping and the conduct of directors,
officers and employees.

The SEC, FINRA and various other regulatory agencies have rigid rules, including
the maintenance of specific levels of net capital by securities brokers and
dealers pursuant to the SEC's Uniform Net Capital Rule 15c3-1 with which the
Company must comply. As of October 31, 2007, the Company had total net capital
of $5,205,259, which is $4,205,259 in excess of the Company's minimum net
capital requirement of $1,000,000.

Additionally, the Company is subject to periodic, routine finance and operations
reviews by FINRA staff and state securities divisions. It should be noted that
the Company has a disciplinary record with FINRA and fines have been levied
against the Company for violations that occurred during the tenure of the prior
management. Given FINRA's policy of progressive disciplinary actions, this prior
record could adversely impact the Company if we are cited for additional
violations.

EMPLOYEES

As of November 30, 2007, we employed 86 individuals. Of the 86 employees, 7 are
in management, 26 are in trading, 31 are in sales, 2 are in compliance, 7 are in
technology and 13 are in administration. We believe that our relations with our
employees are good. None of our employees are represented by a union or any
collective bargaining agreement.

CORPORATE INFORMATION

Our principal offices are located at 111 Pavonia Avenue, Suite 1500A, Jersey
City, New Jersey 07310 and our telephone number is (201) 216-0100. Our corporate
website is http://www.hudsonholdingcorp.com. The information on our website is
not incorporated by reference to this annual report.

We file reports and other information with the SEC. The SEC maintains an
internet site that contains reports, proxy, information statements and other
information at http://www.sec.gov.

                                      -6-
THE OFFERING

OUTSTANDING COMMON               36,725,185 shares of our common stock issued
                                 and outstanding as of November 30, 2007

COMMON STOCK OFFERED             Up to 12,000,000 shares.

USE                              OF PROCEEDS We will not receive any proceeds
                                 from the sale of our common stock by the
                                 selling stockholders. We would, however,
                                 receive proceeds upon the exercise of options
                                 received under the Plans. Any cash proceeds
                                 will be used by us for general corporate
                                 purposes.

RISK FACTORS                     The securities offered hereby involve a high
                                 degree of risk.  See "Risk Factors".

OTCBB SYMBOL                     HDHL OB

                  [remainder of page intentionally left blank]

                                      -7-
RISK FACTORS

      AN INVESTMENT IN OUR COMPANY IS EXTREMELY RISKY. YOU SHOULD CAREFULLY
CONSIDER THE FOLLOWING RISKS, IN ADDITION TO THE OTHER INFORMATION PRESENTED IN
THIS PROSPECTUS BEFORE DECIDING TO BUY OR EXERCISE OUR SECURITIES. IF ANY OF THE
FOLLOWING RISKS ACTUALLY MATERIALIZE, OUR BUSINESS AND PROSPECTS COULD BE
SERIOUSLY HARMED, THE PRICE AND VALUE OF OUR SECURITIES COULD DECLINE AND YOU
COULD LOSE ALL OR PART OF YOUR INVESTMENT.

RISKS RELATED TO OUR BUSINESS

STOCK MARKET VOLATILITY AND OTHER SECURITIES INDUSTRY RISKS COULD ADVERSELY
AFFECT OUR BUSINESS.

Substantially all of our revenues are derived from securities market activities.
As a result, we are directly affected by economic and political conditions,
broad trends in business and finance and changes in volume and price levels of
securities transactions. In recent years, the U.S. securities markets have been
very volatile, which has reduced trading volume and net revenues. The tightening
of credit, the terrorist attacks in the United States on September 11, 2001, the
invasion of lraq in 2003 and other events have also resulted in substantial
market volatility and accompanying reductions in trading volume and net
revenues. In addition, any general economic downturn would adversely affect
trading volumes and net revenues. Severe market fluctuations or weak economic
conditions could reduce our trading volume and net revenues and adversely affect
our profitability.

WE ARE SUBJECT TO MARKET EXPOSURE AND COULD BE ADVERSELY AFFECTED BY A DECREASE
IN THE PRICE OF SECURITIES WHICH WE HOLD IN OUR TRADING ACCOUNTS.

We conduct our market-making activities predominantly as principal, which
subjects our capital to significant risks. These activities involve the
purchase, sale or short sale of securities for our own account and, accordingly,
involve risks of price fluctuations and illiquidity, or rapid changes in the
liquidity of markets that may limit or restrict our ability to either resell
securities we purchase or to repurchase securities we sell in such transactions.
From time to time, we may have large position concentrations in securities of a
single issuer or issuers engaged in a specific industry, which might result in
higher trading losses than would occur if our positions and activities were less
concentrated. The success of our market-making activities primarily depends upon
our ability to attract order flow, the skill of our personnel, general market
conditions, the amount of, and volatility in, our quantitative market-making and
program trading portfolios, effective hedging strategies, the price volatility
of specific securities and the availability of capital. To attract order flow,
we must be competitive on price, size of securities positions traded, liquidity,
order execution, technology, reputation and client relationships and service. In
our role as a market maker, we attempt to derive a profit from the difference
between the prices at which we buy and sell securities. However, competitive
forces often require us to match the quotes other market makers display and to
hold varying amounts of securities in inventory. By having to maintain inventory
positions, we are subject to a high degree of risk. There can be no assurance
that we will be able to manage such risk successfully or that we will not
experience significant losses from such activities.

THERE IS A RISK THAT OUR FUTURE OPERATING RESULTS MAY FLUCTUATE SIGNIFICANTLY.

We may experience significant variation in our future results of operations.
These fluctuations may result from, among other things:

o    introductions of or enhancements to market-making services by us or our
     competitors;
o    the value of our securities positions and our ability to manage the risks
     attendant thereto;
o    the volume of our market-making activities;
o    the dollar value of securities traded;
o    volatility in the securities markets;
o    our market share with institutional clients;
o    our ability to manage personnel, overhead and other expenses, including our
     occupancy expenses under our office leases and legal fees relating to legal
     and regulatory proceedings;
o    the strength of our client relationships; the amount of, and volatility in,
     our quantitative market-making and program trading portfolios;
o    changes in payments for order flow and clearing costs;
o    the addition or loss of executive management and sales, trading and
     technology professionals;
o    legislative, legal and regulatory changes;
o    legal and regulatory matters;

                                      -8-
o    geopolitical risk;
o    the amount and timing of capital expenditures and divestitures;
o    the incurrence of costs associated with acquisitions and dispositions;
o    investor sentiment;
o    technological changes and events;
o    seasonality; and
o    competition and market and economic conditions.

If demand for our services declines due to any of the above factors, and we are
unable to timely adjust our cost structure, our operating results could be
materially and adversely affected.

OUR TRADERS MAY TAKE LARGER RISKS THAN PERMITTED WHICH COULD RESULT IN LARGE
LOSSES.

Although we require our traders to adhere to certain position limits (generally
no more than $500,000 in total positions for the most experienced traders,
without managerial approval), sometimes a trader takes a position beyond these
limits and subjects our company to greater risks. We have established procedures
to guard against this, including real-time position monitoring which should
promptly alert management to any excessive risks. However, there can be no
assurance that management will be able to guard against all risks taken by each
employee.

WE ARE DEPENDENT ON OUR CLEARING BROKER, WHICH MAY GO OUT OF BUSINESS OR CHARGE
US FOR A DEFAULT BY A COUNTER PARTY TO A TRADE.

As a market maker, the majority of our securities transactions are conducted as
principal with broker-dealer and institutional counterparties located in the
United States. We clear our securities transactions through an unaffiliated
clearing broker. Under the terms of the agreement between us and our clearing
broker, the clearing broker has the right to charge us for losses that result
from a counterparty's failure to fulfill its contractual obligations. No
assurance can be given that any such counterparty will not default on its
obligations, which default could have a material adverse effect on our business,
financial condition and operating results. In addition, at any time, a
substantial portion of our assets are held by our clearing broker and,
accordingly, we are subject to credit risk with respect to such clearing broker.
Consequently, we are reliant on the ability of our clearing broker to adequately
discharge its obligations on a timely basis. We are also dependent on the
solvency of such clearing broker. Any failure by the clearing broker to
adequately discharge its obligations on a timely basis, or failure by the
clearing broker to remain solvent, or any event adversely affecting the clearing
broker, could have a material adverse effect on our business, financial
condition and operating results. If our clearing broker was to go out of
business or decide not to continue to act as our clearing broker, our operating
results would be adversely effected until we could replace them.

REDUCED MARKET VOLUME, PRICE AND LIQUIDITY CAN IMPACT OUR REVENUES.

Our revenues may decrease in the event of a decline in market volume, prices or
liquidity. Declines in the volume of securities transactions and in market
liquidity generally result in lower revenues from market-making activities.
Lower price levels of securities may also result in reduced revenue capture, and
thereby reduced revenues from market-making transactions, as well as result in
losses from declines in the market value of securities held in inventory. Sudden
sharp declines in market values of securities can result in illiquid markets,
declines in the market values of securities held in inventory, the failure of
buyers and sellers of securities to fulfill their obligations and settle their
trades, and increases in claims and litigation. Any decline in market volume,
price or liquidity or any other of these factors could have a material adverse
effect on our business, financial condition and operating results.

WE OPERATE IN A HIGHLY REGULATED INDUSTRY AND COMPLIANCE FAILURES COULD
ADVERSELY AFFECT OUR BUSINESS.

The securities industry is subject to extensive regulation covering all aspects
of the securities business. The various governmental authorities and industry
self-regulatory organizations that supervise and regulate us generally have
broad enforcement powers to censure, fine, issue cease-and-desist orders or
suspend or expel us or any of our officers or employees who violate applicable
laws or regulations. We may also be subject to an enforcement action for failure
to supervise if any of our employees or traders violate applicable laws or
regulations. Our ability to comply with all applicable laws and rules is largely
dependent on our establishment and maintenance of compliance and reporting
systems, as well as our ability to attract and retain qualified compliance and
other personnel. If we do not comply with the rules and regulations established,
we could be subject to disciplinary or other regulatory or legal actions in the
future. In addition, it is possible that any past noncompliance could subject us
to future civil lawsuits, the outcome of which could have a material adverse
effect on our financial condition and operating results.

                                      -9-
We are required to keep accurate books and records. There is considerable
fluctuation during any year and from year-to-year in the volume of transactions
we must process. We record transactions and post our books daily. Operations
personnel monitor operations to determine compliance with applicable laws, rules
and regulations. Failure to keep current and accurate books and records can
render us liable to disciplinary action by governmental and self-regulatory
authorities, as well as to claims by our clients.

WE HAVE A PRIOR DISCIPLINARY RECORD WITH FINRA, WHICH COULD HAVE AN ADVERSE
EFFECT ON OUR ABILITY TO OPERATE IF WE BECOME SUBJECT TO ADDITIONAL FINRA
DISCIPLINARY ACTION.

During the period from approximately 1990 through July 31, 2004, primarily while
our operating subsidiary Hudson Securities was owned by and supervised by the
prior management of the prior owners and operating under a different name, we
were cited by the NASD (now known as FINRA) for violations of the NASD's Rules
of Fair Practice and Marketplace Rules on at least 20 occasions and were fined
amounts ranging from $250 to $82,500. The total amount of such fines was
approximately $405,000. The existence of such prior violations could have an
adverse effect on us should such violations recur under the supervision of
current management.

WE FACE SUBSTANTIAL COMPETITION THAT COULD REDUCE OUR MARKET SHARE AND HARM OUR
FINANCIAL PERFORMANCE.

All aspects of our business are highly competitive. We compete directly with
national and regional full service broker-dealers and, to a lesser extent, with
discount brokers, investment advisors and certain commercial banks. The
financial services industry has become considerably more concentrated as
numerous securities firms have either ceased operations or have been acquired by
or merged into other firms. These mergers and acquisitions have increased
competition from these firms, many of which have significantly greater capital
and financial and other resources than we have. With respect to retail brokerage
activities, certain regional firms with which we compete have operated in
certain markets longer than we have and have established long-standing client
relationships. We also compete with others in the financial services industry in
recruiting registered representatives and new employees as well as retaining
current personnel, and we could be adversely affected in the event we were to
lose registered representatives who either individually or in the aggregate
accounted for a significant percentage of our revenues.

IF WE LOSE SENIOR MANAGEMENT AND KEY PERSONNEL OR ARE UNABLE TO ATTRACT AND
RETAIN SKILLED EMPLOYEES WHEN NEEDED, WE MAY NOT BE ABLE TO OPERATE OUR BUSINESS
SUCCESSFULLY.

We are particularly dependent on the services of Mark Leventhal, Martin
Cunningham and Keith Knox. The loss of any of these individuals would have a
significant negative effect on our business. In addition, we believe that our
success will depend in large part upon our continued ability to attract and
retain skilled traders and other employees, which is difficult because the
market for the services of such individuals is very competitive. On January 4,
2007, the Company entered into five year employment agreements, effective as of
January 1, 2007, with Mr. Martin C. Cunningham and Mr. Keith R. Knox, whereby
each will continue in their present positions, Chief Executive Officer and
President, respectively.

WE NEED TO COMPLY WITH STRINGENT CAPITAL REQUIREMENTS AND THEREFORE IF WE SUFFER
SIGNIFICANT LOSSES WE WOULD BE BELOW OUR NET CAPITAL REQUIREMENT.

Many of the regulatory agencies, securities exchanges and other industry
self-regulatory organizations that regulate us have stringent rules with respect
to the maintenance of specific levels of net capital by securities
broker-dealers. Net capital is the net worth of a broker or dealer, less
deductions for certain types of assets. Currently, we are required to maintain
net capital of at least $1,000,000. As of October 31, 2007, we had net capital
of $5,205,259 and excess net capital (that is, net capital less required net
capital) of $4,205,259. We intend to maintain such funds as are necessary to
operate our business and to maintain compliance with regulatory net capital
requirements. Changes to our business may require us to maintain higher net
capital levels than currently. If we fail to maintain the required net capital,
we may be subject to suspension or revocation of our licenses. If such net
capital rules are changed or expanded, or if there is an unusually large charge
against our net capital, we might be required to limit or discontinue those
portions of our business that require the intensive use of capital. A large
operating loss or charge against net capital could adversely affect our ability
to expand or even maintain our present levels of business.

                                      -10-
WE MAY NOT BE ABLE TO GROW AS PLANNED.

As part of our long-term growth strategy, we intend to recruit individual
registered representatives and to evaluate the acquisition of other firms or
assets that would complement or expand our business in attractive service
markets or that would broaden our customer relationships. We cannot assure you
that we will be successful in our recruiting efforts or that we will be able to
identify suitable acquisition candidates available for sale at reasonable prices
or that we will be able to consummate any acquisition. Further, future
acquisitions may further increase our leverage or, if we issue equity securities
to pay for the acquisitions, our stockholders could suffer dilution of their
interests.

We also plan to expand into complementary businesses, both by developing new
product/service offerings that will be valuable to our existing customers and by
entering into strategic partnerships with related businesses that can bring new
customers. The firm now trades listed securities. In addition, we plan to
explore creating a retail brokerage division. There can be no assurance that any
of the new products or services will be developed. If we are unable to raise
adequate capital, we will not have the available funds to create new products.

OUR EXPOSURE TO POSSIBLE LITIGATION COULD ADVERSELY AFFECT OUR BUSINESS.

From time to time we are engaged in various legal and regulatory proceedings
arising in the normal course of business. Many aspects of the securities
brokerage business involve substantial risks of liability. In recent years,
there has been an increasing incidence of litigation involving the securities
brokerage industry, including class action and other suits that generally seek
substantial damages, including in some cases punitive damages. While it is not
possible to determine with certainty the outcome of these matters, we are of the
opinion that the eventual resolution of such proceedings will not have a
material adverse effect on our financial position or operating results. Any such
litigation brought in the future could have a material adverse effect on our
business, financial condition and operating results.

From time to time, we may also be engaged in various legal proceedings not
related to securities. We currently maintain various types of insurance,
including employment practices liability insurance, the proceeds of which may
help to reduce the amount we may otherwise be required to pay with respect to
certain types of claims. However, there can be no assurance that we will be able
to obtain such insurance in the future. If it can be obtained, the price for
such insurance may be unreasonable. Even if such insurance is in force, the
amount of any award may exceed the maximum coverage provided by such insurance,
in which case we will be required to pay any uncovered portion.

OUR BUSINESS RELIES HEAVILY ON COMPUTERS AND OTHER ELECTRONIC SYSTEMS AND
CAPACITY CONSTRAINTS AND FAILURES OF THESE SYSTEMS COULD HARM OUR BUSINESS.

Despite efforts to minimize the risk, system failures could negatively impact
our ability to conduct our business. Furthermore, as our business expands, we
face risks relating to the need to expand and upgrade our transaction processing
systems, network infrastructure and other aspects of our technology. While many
of our systems are designed to accommodate additional growth without redesign or
replacement, we may nevertheless need to make significant investments in
additional hardware and software to accommodate growth. We cannot assure you
that we will be able to predict accurately the timing or rate of such growth, or
expand and upgrade our systems and infrastructure on a timely basis.

RISKS ASSOCIATED WITH OUR SECURITIES

OUR COMMON STOCK IS NOT ACTIVELY TRADED, SO YOU MAY BE UNABLE TO SELL AT OR NEAR
ASK PRICES OR AT ALL IF YOU NEED TO SELL YOUR SHARES TO RAISE MONEY OR OTHERWISE
DESIRE TO LIQUIDATE YOUR SHARES.

Our Common Stock has historically been sporadically traded on the OTC Bulletin
Board, meaning that the number of persons interested in purchasing our Common
Stock at or near ask prices at any given time has been, and may continue to be,
relatively small or non-existent. This situation is attributable to a number of
factors, including the fact that we are a small company which is relatively
unknown to stock analysts, stock brokers, institutional investors and others in
the investment community that generate or influence sales volume, and that even
if we came to the attention of such persons, they tend to be risk-adverse and
would be reluctant to purchase or recommend the purchase of our shares until
such time as we became more seasoned and viable. As a consequence, there may be
periods of several days or more when trading activity in our shares is minimal
or non-existent, as compared to a seasoned issuer which has a large and steady
volume of trading activity that will generally support continuous sales without
an adverse effect on share price. We cannot assure you that a broader or more
active public trading market for our Common Stock will develop or be sustained,
or that current trading levels will be sustained or not diminish.

                                      -11-
THE APPLICATION OF THE "PENNY STOCK" RULES TO OUR COMMON STOCK COULD LIMIT THE
TRADING AND LIQUIDITY OF THE COMMON STOCK, ADVERSELY AFFECT THE MARKET PRICE OF
OUR COMMON STOCK AND INCREASE YOUR TRANSACTION COSTS TO SELL THOSE SHARES.

As long as the trading price of our Common Stock is below $5.00 per share, the
open-market trading of our Common Stock will be subject to the "penny stock"
rules. The "penny stock" rules impose additional sales practice requirements on
broker-dealers who sell securities to persons other than established customers
and accredited investors (generally those with assets in excess of $1,000,000 or
annual income exceeding $200,000 or $300,000 together with their spouse). These
regulations require the delivery, prior to any transaction involving a penny
stock, of a disclosure schedule explaining the penny stock market and the
associated risks. Under these regulations, certain brokers who recommend such
securities to persons other than established customers or certain accredited
investors must make a special written suitability determination regarding such a
purchaser and receive such purchaser's written agreement to a transaction prior
to sale. These regulations have the effect of limiting the trading activity of
the Common Stock, reducing the liquidity of an investment in the Common Stock
and increasing the transaction costs for sales and purchases of our Common Stock
as compared to other securities.

THE MARKET PRICE FOR OUR COMMON STOCK IS PARTICULARLY VOLATILE GIVEN OUR STATUS
AS A RELATIVELY UNKNOWN COMPANY WITH A SMALL AND THINLY TRADED PUBLIC FLOAT,
LIMITED OPERATING HISTORY AND VARIABLE PROFITABILITY WHICH COULD LEAD TO WIDE
FLUCTUATIONS IN OUR SHARE PRICE. YOU MAY BE UNABLE TO SELL YOUR COMMON STOCK AT
OR ABOVE YOUR PURCHASE PRICE, WHICH MAY RESULT IN SUBSTANTIAL LOSSES TO YOU.

 The market for our Common Stock is characterized by significant price
volatility when compared to seasoned issuers, and we expect that our share price
will continue to be more volatile than a seasoned issuer for the indefinite
future. The volatility in our share price is attributable to a number of
factors. First, as noted above, our Common Stock is sporadically and thinly
traded. As a consequence of this lack of liquidity, the trading of relatively
small quantities of shares by our stockholders may disproportionately influence
the price of those shares in either direction. The price for our Shares could,
for example, decline precipitously in the event that a large number of shares of
our Common Stock are sold on the market without commensurate demand, as compared
to a seasoned issuer which could better absorb those sales without adverse
impact on its share price. Secondly, we are a speculative or "risky" investment
due to our limited operating history, and uncertainty of future market
acceptance for our services. As a consequence of this enhanced risk, more risk
adverse investors may, under the fear of losing all or most of their investment
in the event of negative news or lack of progress, be more inclined to sell
their shares on the market more quickly and at greater discounts than would be
the case with the stock of a seasoned issuer.

Many of these factors are beyond our control and may decrease the market price
of our Common Stock, regardless of our operating performance. We cannot make any
predictions or projections as to what the prevailing market price for our Common
Stock will be at any time, including as to whether our Common Stock will sustain
its current market price, or as to what effect that the sale of shares or the
availability of Common Stock for sale at any time will have on the prevailing
market price.

In addition, the market price of the Common Stock could be subject to wide
fluctuations in response to:

     o    quarterly variations in our revenues and operating expenses;
     o    fluctuations in interest rates;
     o    the operating and stock price performance of other companies that
          investors may deem comparable to us; and
     o    news reports relating to trends in our markets or general economic
          conditions.

The stock market in general and the market prices for brokerage-related
companies in particular, have experienced volatility that often has been
unrelated to the operating performance of such companies. These broad market and
industry fluctuations may adversely affect the price of our stock, regardless of
our operating performance.

Stockholders should be aware that, according to SEC Release No. 34-29093, the
market for penny stocks has suffered in recent years from patterns of fraud and
abuse. Such patterns include (1) control of the market for the security by one
or a few broker-dealers that are often related to the promoter or issuer; (2)
manipulation of prices through prearranged matching of purchases and sales and
false and misleading press releases; (3) boiler room practices involving
high-pressure sales tactics and unrealistic price projections by inexperienced

                                      -12-
sales persons; (4) excessive and undisclosed bid-ask differential and markups by
selling broker-dealers; and (5) the wholesale dumping of the same securities by
promoters and broker-dealers after prices have been manipulated to a desired
level, along with the resulting inevitable collapse of those prices and with
consequent investor losses. The occurrence of these patterns or practices could
increase the volatility of our share price.

WE DO NOT INTEND TO PAY DIVIDENDS TO OUR STOCKHOLDERS.

We do not have any current plans to pay dividends to our stockholders. We
currently intend to retain any future earnings for funding growth and,
therefore, do not expect to pay any dividends in the foreseeable future.

FOUR EMPLOYEES CONTROL APPROXIMATELY 45% OF THE VOTING CAPITAL STOCK OF OUR
COMPANY.

Our three executive officers, plus Steven Winkler, our NASDAQ trading manager at
the Company's wholly-owned broker-dealer subsidiary, collectively own an
aggregate of 45% of our outstanding common stock. In the event that these
individuals vote together on any or all issues, you will have no effective voice
in our management. Accordingly, these four individuals could substantially
influence the outcome of any matters submitted to a vote of our stockholders and
have the ability to determine all management policy and financing decisions.

FUTURE SALES OF OUR COMMON STOCK COULD PUT DOWNWARD SELLING PRESSURE ON OUR
SHARES, AND ADVERSELY AFFECT THE STOCK PRICE. THERE IS A RISK THAT THIS DOWNWARD
PRESSURE MAY MAKE IT IMPOSSIBLE FOR A STOCKHOLDER TO SELL ITS SHARES AT ANY
REASONABLE PRICE, IF AT ALL.

Future sales of substantial amounts of our Common Stock in the public market, or
the perception that such sales could occur, could put downward selling pressure
on our shares, and adversely affect the market price of our Common Stock.

THERE ARE LIMITATIONS IN CONNECTION WITH THE AVAILABILITY OF QUOTES AND ORDER
INFORMATION ON THE OTC BULLETIN BOARD

Trades and quotations on the OTCBB involve a manual process, and the market
information for such securities cannot be guaranteed. In addition, quote
information, or even firm quotes, may not be available. The manual execution
process may delay order processing and intervening price fluctuations may result
in the failure of a limit order to execute or the execution of a market order at
a significantly different price. Execution of trades, execution reporting and
the delivery of legal trade confirmation may be delayed significantly.
Consequently, one may not be able to sell shares of our Common Stock at the
optimum trading prices.

THERE ARE DELAYS IN ORDER COMMUNICATION ON THE OTCBB.

Electronic processing of orders is not available for securities traded on the
OTCBB and high order volume and communication risks may prevent or delay the
execution of one's OTCBB trading orders. This lack of automated order processing
may affect the timeliness of order execution reporting and the availability of
firm quotes for shares of our Common Stock. Heavy market volume may lead to a
delay in the processing of OTCBB security orders for shares of our Common Stock,
due to the manual nature of the market. Consequently, one may not able to sell
shares of our Common Stock at the optimum trading prices.

THERE IS LIMITED LIQUIDITY ON THE OTCBB.

When fewer shares of a security are being traded on the OTCBB, volatility of
prices may increase and price movement may outpace the ability to deliver
accurate quote information. Due to lower trading volumes in shares of our Common
Stock, there may be a lower likelihood of one's orders for shares of our Common
Stock being executed, and current prices may differ significantly from the price
one was quoted by the OTCBB at the time of one's order entry.

THERE IS A LIMITATION IN CONNECTION WITH THE EDITING AND CANCELING OF ORDERS ON
THE OTCBB.

Orders for OTCBB securities may be canceled or edited like orders for other
securities. All requests to change or cancel an order must be submitted to,
received and processed by the OTCBB. Due to the manual order processing involved
in handling OTCBB trades, order processing and reporting may be delayed, and one
may not be able to cancel or edit one's order. Consequently, one may not able to
sell shares of our Common Stock at the optimum trading prices.

                                      -13-
INCREASED DEALER COMPENSATION COULD ADVERSELY AFFECT THE STOCK PRICE.

The dealer's spread (the difference between the bid and ask prices) may be large
and may result in substantial losses to the seller of shares of our Common Stock
on the OTCBB if the stock must be sold immediately. Further, purchasers of
shares of our Common Stock may incur an immediate "paper" loss due to the price
spread. Moreover, dealers trading on the OTCBB may not have a bid price for
shares of our Common Stock on the OTCBB. Due to the foregoing, demand for shares
of our Common Stock on the OTCBB may be decreased or eliminated.

SHARES ELIGIBLE FOR FUTURE SALE MAY ADVERSELY AFFECT THE MARKET.

From time to time, certain of our stockholders may be eligible to sell all or
some of their shares of Common Stock by means of ordinary brokerage transactions
in the open market pursuant to Rule 144, promulgated under the Securities Act,
subject to certain limitations. In general, pursuant to Rule 144, a stockholder
(or stockholders whose shares are aggregated) who has satisfied a one-year
holding period may, under certain circumstances, sell within any three-month
period a number of securities which does not exceed the greater of 1% of the
then outstanding shares of Common Stock or the average weekly trading volume of
the class during the four calendar weeks prior to such sale. Rule 144 also
permits, under certain circumstances, the sale of securities, without any
limitation, by our stockholders that are non-affiliates that have satisfied a
two-year holding period. Any substantial sale, or cumulative sales, of our
Common Stock pursuant to Rule 144 or pursuant to any resale prospectus may have
a material adverse effect on the market price of our securities.

                                      -14-
USE OF PROCEEDS

      The shares which may be sold under this prospectus will be sold for the
respective accounts of each of the selling stockholders. Accordingly, we will
not realize any proceeds from the sale of the shares. We will receive proceeds
from the exercise of the options; however, no assurance can be given as to when
or if any or all of the options will be exercised. If any options are exercised,
the proceeds derived therefrom will be used for working capital and general
corporate purposes. All expenses of the registration of the shares will be paid
by us. See "Selling Stockholders" and "Plan of Distribution."

                              SELLING STOCKHOLDERS

      This prospectus relates to the shares of our common stock that are being
registered for reoffers and resales by selling stockholders who have acquired or
may acquire shares pursuant to the Plans. Offers and sales by selling
stockholders who are our "affiliates" (as such term is defined in Rule 405 under
the Securities Act) are also covered by this prospectus.

      The selling stockholders are our prior, current and future officers,
directors, employees and consultants (or any of their respective assigns) who
have acquired or may acquire in the future shares of our common stock under the
Plan. The selling stockholders may, from time to time, resell all, a portion or
none of the shares of our common stock covered by this prospectus. The following
table sets forth information as of November 30, 2007 with respect to
"beneficial" ownership (within the meaning of Rule 13d-3 under the Exchange Act)
of our common stock by each selling stockholder whose identity is known as of
the date of this prospectus. There is no assurance that any of the selling
stockholders will sell any or all of the shares offered by them under this
registration statement. The address for each executive officer, director,
employee, consultant and other selling stockholders listed below is c/o 111 Town
Square Place, Suite 1500A, Jersey City, New Jersey 07310

Any changed information will be set forth in an amendment to the registration
statement or supplement to this prospectus, to the extent required by law.
NUMBER OF
                                                                                SHARES TO BE     NUMBER OF
                                                 NUMBER OF                       OFFERED FOR     SHARES TO   PERCENTAGE TO
                                POSITION,          SHARES        PERCENTAGE    THE ACCOUNT OF    BE OWNED          BE
                             OFFICE OR OTHER    BENEFICIALLY    BENEFICIALLY    THE SELLING        AFTER      BENEFICIALLY
                                 MATERIAL          OWNED       OWNED BEFORE      STOCKHOLDER     OFFERING     OWNED AFTER
NAME                           RELATIONSHIP       (1) (2)         OFFERING           (3)            (4)         OFFERING
----
Agnihotri, Pankaj                  ***                 16,667        *                  16,667            0        *
Altman, Randy                       **                      0        *                  10,000            0        *
Aprigliano, Paul                    **                  8,334        *                 100,000            0        *
Bouwmans, Gregg                     **                  8,334        *                 100,000            0        *
Bianchi, Dolores                    **                108,334        *                 125,000      100,000        *
Bisker, Mark                       (5)                      0        *                 250,000            0        *
Chicoli, Raymond                    **                  5,000        *                  15,000            0        *
Chiusano, Carmine                  (6)                 35,000        *               35,000(9)            0        *
Clarke, Patrick                     **                 16,667        *                 150,000            0        *
Cohen, Robert                       **                  5,000        *                  15,000            0        *
Conti, Albert                       **                      0        *                  10,000            0        *
Dudzinski, Gregg                    **                      0        *                  30,000            0        *
Ferrante, Frank                     **                  5,000        *                  15,000            0        *
Genovesi, Arthur                    **                 43,593        *                  75,000       35,259        *
Giordano, Andrew                    **                      0        *                  15,000            0        *
Harper, David                       **                      0        *                  25,000            0        *
Hechler, Randy                      **                      0        *                  35,000            0        *
Ju, Peter                           **                 10,000        *                  30,000            0        *
Kessler, Steven                     **                381,667        *                 150,000      365,000        *

                                      -15-
Landau, Joanne                     (7)                 35,000        *               35,000(9)            0        *
Lobretto, Anthony                   **                      0        *                  15,000            0        *
Minott, Daisy                       **                  9,334        *                  25,000        1,000        *
Murray, Scott                       **                 58,333        *                  25,000       50,000        *
Pasternak, Ronald                   **              1,491,666      4.00%               500,000    1,325,000      3.57%
Perez, John                         **                  2,000        *                  15,000        2,000        *
Polt, Eugene                        **                  8,334        *                 100,000            0        *
Santangelo, Mary Gurnee             **                      0        *                  35,000            0        *
Scheer, Jared                       **                      0        *                  35,000            0        *
Schmuckler, John                    **                      0        *                 250,000            0        *
Schwartz, Ronald                    **                180,000        *                 250,000      180,000        *
Schweitzer, Keith                   **                  8,333        *                  25,000            0        *
Schweitzer, Kevin                   **                 90,333        *                  25,000       82,000        *
Shelley, Jonathan                   **                  8,333        *                  25,000            0        *
Szambel, Rick                       **                  8,333        *                  25,000            0        *
Van Tongeren, Ron                   **                  5,000        *                  25,000            0        *
Vollaro, Jamie                      **                      0        *                  35,000            0        *
Weisberg, Dave                      **                263,333        *                 250,000      180,000        *
Zugschwert, Peter                  (8)                249,356        *               35,000(9)      214,356        *
* Less than 1%.
** The selling stockholder is an employee or consultant of the company. *** The
selling stockholder is a former employee of the company.
(1) Represents common stock owned, vested options, and options to vest within 60
days of the date hereof.
(2) The amounts and percentages of common stock beneficially owned are reported
on the basis of regulations of the SEC governing the determination of beneficial
ownership of securities. Under the Rules of the SEC, a person is deemed to be a
"beneficial owner" of a security if that person has or shares "voting power",
which included the power to vote or direct the voting of such security, or
"investment power" which includes the power to dispose of or to direct the
disposition of such security. A person is also deemed to be a beneficial owner
of any securities of which that person as a right to acquire beneficial
ownership within 60 days, including through the exercise of options or warrants.
Under these rules, more than one person may be deemed a beneficial owner of the
same securities and a person may be deemed the beneficial owner of securities as
to which he or she has no economic interest.
(3) Includes shares underlying vested and unvested options and unvested common
stock.
(4) Represents shares of our common stock acquired by means other than through
the Plan.
(5) Mark Bisker is a member of our Board of Directors.
(6) Carmine Chiusano is a member of our Board of Directors.
(7) Joanne Landau is a member of our Board of Directors.
(8) Peter Zugschwert is a member of our board of directors
(9) These shares constitute "control securities" as such term is defined in
General Instruction C to Form S-8.

                                      -16-
PLAN OF DISTRIBUTION

      In this section of the prospectus, the term "selling stockholder" means
and includes:

     o    the persons identified in the table above as the selling stockholders;

     o    those persons whose identities are not known as of the date hereof but
          may in the future be eligible to receive stock or options under the
          Plans; and any of the donees, pledgees, distributees, transferees or
          other successors in interest of those persons

     o    referenced above who may: (a) receive any of the shares of our common
          stock offered hereby after the date of this prospectus and (b) offer
          or sell those shares hereunder.

      The shares of our common stock offered by this prospectus may be sold from
time to time directly by the selling stockholders. Alternatively, the selling
stockholders may from time to time offer such shares through underwriters,
brokers, dealers, agents or other intermediaries. The selling stockholders as of
the date of this prospectus have advised us that there were no underwriting or
distribution arrangements entered into with respect to the common stock offered
hereby. The distribution of the common stock by the selling stockholders may be
effected: in one or more transactions that may take place on the OTCBB through
customary brokerage channels, either through brokers acting as agents for the
selling stockholders, or through market makers, dealers or underwriters acting
as principals who may resell these shares on the OTCBB; in privately-negotiated
sales; by a combination of such methods; or by other means. These transactions
may be effected at market prices prevailing at the time of sale, at prices
related to such prevailing market prices or at other negotiated prices. Usual
and customary or specifically negotiated brokerage fees or commissions may be
paid by the selling stockholders in connection with sales of our common stock.

      The selling stockholders may enter into hedging transactions with
broker-dealers in connection with distributions of the shares or otherwise. In
such transactions, broker-dealers may engage in short sales of the shares of our
common stock in the course of hedging the positions they assume with the selling
stockholders. The selling stockholders also may sell shares short and redeliver
the shares to close out such short positions. The selling stockholders may enter
into option or other transactions with broker-dealers which require the delivery
to the broker-dealer of shares of our common stock. The broker-dealer may then
resell or otherwise transfer such shares of common stock pursuant to this
prospectus.

      The selling stockholders also may lend or pledge shares of our common
stock to a broker-dealer. The broker-dealer may sell the shares of common stock
so lent, or upon a default the broker-dealer may sell the pledged shares of
common stock pursuant to this prospectus. Any securities covered by this
prospectus which qualify for sale pursuant to Rule 144 may be sold under Rule
144 rather than pursuant to this prospectus.

      The selling stockholders have advised us that they have not entered into
any agreements, understandings or arrangements with any underwriters or
broker-dealers regarding the sale of their securities. There is no underwriter
or coordinating broker acting in connection with the proposed sale of shares of
common stock the selling stockholders.

      Although the shares of common stock covered by this prospectus are not
currently being underwritten, the selling stockholders or their underwriters,
brokers, dealers or other agents or other intermediaries, if any, that may
participate with the selling security holders in any offering or distribution of
common stock may be deemed "underwriters" within the meaning of the Act and any
profits realized or commissions received by them maybe deemed underwriting
compensation thereunder.

      Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of shares of the common stock offered hereby may not
simultaneously engage in market making activities with respect to the common
stock for a period of up to five days preceding such distribution. The selling
stockholders will be subject to the applicable provisions of the Exchange Act
and the rules and regulations promulgated thereunder, including without
limitation Regulation M, which provisions may limit the timing of purchases and
sales by the selling stockholders.

                                      -17-
In order to comply with certain state securities or blue sky laws and
regulations, if applicable, the common stock offered hereby will be sold in such
jurisdictions only through registered or licensed brokers or dealers. In certain
states, the common stock may not be sold unless they are registered or qualified
for sale in such state, or unless an exemption from registration or
qualification is available and is obtained.

      We will bear all costs, expenses and fees in connection with the
registration of the common stock offered hereby. However, the selling
stockholders will bear any brokerage or underwriting commissions and similar
selling expenses, if any, attributable to the sale of the shares of common stock
offered pursuant to this prospectus. We have agreed to indemnify certain of the
selling security holders against certain liabilities, including liabilities
under the Act, or to contribute to payments to which any of those security
holders may be required to make in respect thereof.

      There can be no assurance that the selling stockholders will sell any or
all of the securities offered by them hereby.

                                  LEGAL MATTERS

The Company has been named as a defendant in various routine actions that are
incidental to its activities as a broker-dealer including civil actions and
arbitration. From time to time, the Company is also involved in proceedings and
investigations by self-regulatory organizations. Although the ultimate outcome
of these matters involving the Company cannot be predicted with certainty,
management believes it has meritorious defenses to all such actions and intends
to defend each of these actions vigorously. Although there can be no assurances
that such matters will not have a material adverse effect on the results of
operations or financial condition of the Company in any future period, depending
in part on the results for such period, in the opinion of the Company's
management the ultimate resolution of such actions against the Company will have
no material adverse effect on the Company's financial condition. The validity of
the shares of our common stock being offered herein has been passed upon for us
by Ellenoff Grossman & Schole LLP of New York, New York.

                                     EXPERTS

      The financial statements as of and for each of the two years in the period
ended March 31, 2007, incorporated in this prospectus by reference from our
Annual Report on Form 10-KSB for the year ended March, 31 2007 have been audited
by Eisner LLP independent registered public accounting firm, as stated in their
report incorporated herein by reference, and have been so incorporated in
reliance upon the report of such firm given upon their authority as experts in
accounting and auditing.

                                      -18-
WHERE YOU CAN FIND MORE INFORMATION

      We have filed a registration statement with the Securities and Exchange
Commission under the Securities Act of 1933, as amended, with respect to the
shares of our common stock offered by this prospectus. This prospectus is part
of that registration statement and does not contain all the information included
in the registration statement. For further information with respect to our
common stock and us, you should refer to the registration statement, its
exhibits and the material incorporated by reference therein. Portions of the
exhibits have been omitted as permitted by the rules and regulations of the
Securities and Exchange Commission. Statements made in this prospectus as to the
contents of any contract, agreement or other document referred to are not
necessarily complete. In each instance, we refer you to the copy of the
contracts or other documents filed as an exhibit to the registration statement,
and these statements are hereby qualified in their entirety by reference to the
contract or document. The registration statement may be inspected and copied at
the public reference facilities maintained by the Securities and Exchange
Commission at Room 1024, Judiciary Plaza, 100 F Street, N.E., Washington, D.C.
20549 and the Regional Offices at the Commission located in the Citicorp Center,
500 West Madison Street, Suite 1400, Chicago, Illinois 60661, and at 233
Broadway, New York, New York 10279. Copies of those filings can be obtained from
the Commission's Public Reference Section, Judiciary Plaza, 100 F Fifth Street,
N.E., Washington, D.C. 20549 at prescribed rates and may also be obtained from
the web site that the Securities and Exchange Commission maintains at
http://www.sec.gov. You may also call the Commission at 1-800-SEC-0330 for more
information. We file annual, quarterly and current reports and other information
with the Securities and Exchange Commission. You may read and copy any reports,
statements or other information on file at the Commission's public reference
room in Washington, D.C. You can request copies of those documents upon payment
of a duplicating fee, by writing to the Securities and Exchange Commission.

                      DISCLOSURE OF COMMISSION POSITION ON
                  INDEMNIFICATION FOR SECURITIES LAW VIOLATIONS

      Our certificate of incorporation provides that all our directors,
officers, employees and agents shall be entitled to be indemnified by us to the
fullest extent permitted under the Delaware General Corporation Law, provided
that they acted in good faith and that they reasoned their conduct or action was
in, or not opposed to, the best interest of our company. Our Bylaws provide for
indemnification of our officers, directors and others who become a party to an
action on our behalf by us to the fullest extent not prohibited under the
Delaware General Corporation Law. Further, we maintain officer and director
liability insurance. However, insofar as indemnification for liabilities arising
under the Securities Act may be permitted to our directors, officers, and
controlling persons pursuant to the foregoing provisions or otherwise, we have
been advised that in the opinion of the SEC such indemnification is against
public policy as expressed in the Securities Act and is, therefore,
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment of expenses incurred or paid by a director,
officer or controlling person in a successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, we will, unless in the opinion
of our counsel the matter has been settled by controlling precedent, submit to
the court of appropriate jurisdiction the question whether such indemnification
by it is against public policy as expressed in the Securities Act and will be
governed by the final adjudication of such issue.

      YOU SHOULD RELY ONLY ON THE INFORMATION CONTAINED IN THIS DOCUMENT. WE
HAVE NOT AUTHORIZED ANYONE TO PROVIDE YOU WITH INFORMATION THAT IS DIFFERENT.
THIS DOCUMENT MAY ONLY BE USED WHERE IT IS LEGAL TO SELL THESE SECURITIES. THE
INFORMATION IN THIS DOCUMENT MAY ONLY BE ACCURATE ON THE DATE OF THIS DOCUMENT.

      ADDITIONAL RISKS AND UNCERTAINTIES NOT PRESENTLY KNOWN OR THAT ARE
CURRENTLY DEEMED IMMATERIAL MAY ALSO IMPAIR OUR BUSINESS OPERATIONS. THE RISKS
AND UNCERTAINTIES DESCRIBED IN THIS DOCUMENT AND OTHER RISKS AND UNCERTAINTIES
WHICH WE MAY FACE IN THE FUTURE WILL HAVE A GREATE IMPACT ON THOSE WHO PURCHASE
OUR COMMON STOCK. THESE PURCHASERS WILL PURCHASE OUR COMMON STOCK AT THE MARKET
PRICE OR AT A PRIVATELY NEGOTIATED PRICE AND WILL RUN THE RISK OF LOSING THEIR
ENTIRE INVESTMENT.

                                      -19-
HUDSON HOLDING CORPORATION

                                12,000,000 SHARES
                                  COMMON STOCK

--------------------------------------------------------------------------------

                                   PROSPECTUS

--------------------------------------------------------------------------------

                                DECEMBER 3, 2007
--------------------------------------------------------------------------------

                                     PART II

                     INFORMATION NOT REQUIRED IN PROSPECTUS

ITEM 3.     INCORPORATION OF DOCUMENTS BY REFERENCE

      Included in the prospectus which is part of this registration statement.

ITEM 4.     DESCRIPTION OF SECURITIES

      Included in the prospectus which is part of this registration statement.

ITEM 5.     INTERESTS OF NAMED EXPERTS AND COUNSEL.

      N/A.

ITEM 6.     INDEMNIFICATION OF OFFICERS AND DIRECTORS.

      Our certificate of incorporation provides that all our directors,
officers, employees and agents shall be entitled to be indemnified by us to the
fullest extent permitted under the Delaware General Corporation Law, provided
that they acted in good faith and that they reasoned their conduct or action was
in, or not opposed to, the best interest of our company.

      Our Bylaws provide for indemnification of our officers, directors and
others who become a party to an action on our behalf by us to the fullest extent
not prohibited under the Delaware General Corporation Law. Further, we maintain
officer and director liability insurance.

      Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers or persons controlling us pursuant
to the foregoing provisions, we have been informed that in the opinion of the
Commission such indemnification is against public policy as expressed in the Act
and is therefore unenforceable.

ITEM 7.     EXEMPTION FROM REGISTRATION CLAIMED.

      All shares of common stock registered hereunder for reoffer or resale will
be granted, or issued upon exercise of options granted or to be granted,
pursuant to the Plans. The options are non-transferable. Options granted as of
the date hereof as well as shares of common stock issued upon the exercise of
such options were granted or issued in transactions not involving a public
offering. Upon exercise of an option, the optionee was required to execute an
undertaking not to resell such shares except pursuant to an effective
registration statement or other exemption under the Securities Act, a
restrictive legend is placed on the certificates for the shares of common stock
purchased and transfer stops are placed against such certificates. Such shares
may only be reoffered and sold pursuant to registration under the Act or
pursuant to an applicable exemption under the Act. As a result, such offers and
sales are exempt from the registration requirements of the Act pursuant to the
provisions of Section 4(2) of the Act.

ITEM 8.     EXHIBITS.

      The following exhibits are filed with this Registration statement.

NUMBER       DESCRIPTION
--------     -------------------------------------------------------------------
  4.1        Registrant's 2005 Stock Option Plan(1)
  4.2        Registrant's 2007 Long-Term Incentive Compensation Plan(2)
  5.1        Opinion of Ellenoff Grossman & Schole LLP*
 23.1        Consent of Ellenoff Grossman & Schole LLP (contained in
             Exhibit 5.1)*
 23.2        Consent of Eisner, LLP*

(1) Filed as part of the Company's 2005 Schedule 14A.
(2) Filed as part of the Company's 2007 Schedule 14A.
*   Filed herewith.

                                      -21-
ITEM 9. UNDERTAKINGS.

(a) The undersigned registrant hereby undertakes:

       (1) To file, during any period in which offers or sales are being made, a
post-effective amendment to this registration statement.

            (i) To include any material information with respect to the plan of
distribution not previously disclosed in the registration statement or any
material change to such information in the registration statement.

      (2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to be
anew registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial
bonafide offering thereof.

      (3) To remove from registration by means of a post-effective amendment any
of the securities being registered which remain unsold at the termination of the
offering.

      (4) That prior to any public reoffering of the securities registered
hereunder through use of a prospectus which is a part of this registration
statement, by any person or party who is deemed to be an underwriter within the
meaning of Rule 145(c), such reoffering prospectus will contain the information
called for by the applicable registration form with respect to reofferings by
persons who may be deemed underwriters, in addition to the information called
for by the other items of the applicable form.

      (5) That every prospectus (i) that is filed pursuant to paragraph (4)
immediately preceding, or (ii) that purports to meet the requirements of Section
10(a)(3) of the Securities Act of 1933 and is used in connection with an
offering of securities subject to Rule 415, will be filed as a part of an
amendment to the registration statement and will not be used until such
amendment is effective, and that, for purposes of determining any liability
under the Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed to be
the initial bona fide offering thereof.

      (6) That, for purposes of determining any liability under the Securities
Act of 1933, each filing of the registrant's annual report pursuant to Section
13(a) or 15(d) of the Securities Exchange Act of 1934 (and, where applicable,
each filing of an employee benefit plan's annual report pursuant to Section
15(d) of the Securities Exchange Act of 1934) that is incorporated by reference
in the registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bonafide offering thereof.

      (7) To respond to requests for information that is incorporated by
reference into the joint proxy statement/prospectus pursuant to Item 4, 10(b),
11or 13 of this form, within one business day of receipt of such request, and to
send the incorporated documents by first class mail or other equally prompt
means. This includes information contained in documents filed subsequent to the
effective date of the registration statement through the date of responding to
the request.

      (8) To supply by means of a post-effective amendment all information
concerning a transaction, and the company being acquired involved therein, that
was not the subject of and included in the registration statement when it became
effective.

(b) Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers and controlling persons of the
registrant pursuant to the foregoing provisions, or otherwise, the registrant
has been advised that in the opinion of the Securities and Exchange Commission
such indemnification is against public policy as expressed in the Act and is,
therefore, unenforceable. In the event that a claim for indemnification against
such liabilities (other than the payment by the registrant of expenses incurred
or paid by a director, officer or controlling person of the registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrant will, unless in the opinion of its counsel the matter
has been settled by controlling precedent, submit to a court of appropriate
jurisdiction the question whether such indemnification by it is against public
policy as expressed in the Act and will be governed by the final adjudication of
such issue.

(c) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.

                                      -22-
SIGNATURES

THE REGISTRANT. Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, there unto
duly authorized, in the City of Jersey City, State of New Jersey, on December 3,
2007.

                                     HUDSON HOLDING CORPORATION

                                     By: /s/ Martin C. Cunningham
                                     ----------------------------
                                     Name:  Martin C. Cunningham
                                     Title: Chairman and Chief Executive Officer

      Hudson Holding Corporation and each of the undersigned do hereby appoint
Marty Cunningham and Keith Knox and each of them severally, its or his true and
lawful attorney to execute on behalf of Hudson Holding Corp. and the undersigned
any and all amendments to this Registration Statement on Form S-8 and to file
the same with all exhibits thereto and other documents in connection therewith,
with the Securities and Exchange Commission; each of such persons shall have the
power to act hereunder with or without the other.

      In accordance with the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons in the
capacities and on the dates stated.

 Signatures                       Title                              Date
 ----------                       -----                              ----

                           Chairman of the Board,               December 3, 2007
/s/ Martin C. Cunningham   Chief Executive Officer and
------------------------   Director (principal executive officer)
Martin C. Cunningham

/s/ Keith R. Knox          President, Secretary and Director    December 3, 2007
-----------------------    (principal financial and accounting
Keith R. Knox              officer)

/s/ Mark Leventhal         Executive Vice President             December 3, 2007
-----------------------    and Director
Mark Leventhal

/s/ Peter J. Zugschwert    Director                             December 3, 2007
------------------------
Peter J. Zugschwert

/s/ Joanne V. Landau       Director                             December 3, 2007
------------------------
Joanne V. Landau

/s/ Carmine V. Chiusano    Director                             December 3, 2007
------------------------
Carmine V. Chiusano

                           Director                             December 3, 2007
------------------------
Mark Bisker

                                      S-1