EXHIBIT 10.39
                            TAX ALLOCATION AGREEMENT


     AGREEMENT dated March 27, 1997, by and among The Ashton  Technology  Group,
Inc. (Parent) and each of its undersigned subsidiaries (Subsidiaries).

                                   WITNESSETH

     WHEREAS,  the parties hereto are members of an affiliated group (Affiliated
Group) as defined in Section 1504(a); and

     WHEREAS,  such Affiliated  Group will file a U.S.  consolidated  income tax
return  for its  taxable  year  ended  March 31,  1997 and is  required  to file
consolidated tax returns for subsequent years; and

     WHEREAS, it is the intent and desire of the parties hereto that a method be
established  for  allocating  the  consolidated  tax liability of the Affiliated
Group  among its  members,  for  reimbursing  the Parent for payment of such tax
liability,  for compensating any party for use of its losses or tax credits, and
to provide for the allocation and payment of any refund arising from a carryback
of losses or tax credits from subsequent tax years.

     Now,  THEREFORE,  in  consideration  of the mutual  covenants  and promises
contained herein, the parties hereto agree as follows:

     1. A  U.S.consolidated  income tax return  shall be filed by the Parent for
the tax year ended March 31, 1997,  and for each  subsequent  taxable  period in
respect of which this Agreement is in effect and for which the Affiliated  Group
is required or  permitted to file a  consolidated  tax return.  Each  Subsidiary
shall execute and file such consent,  elections, and other documents that may be
required or appropriate for the proper filing of such returns.

     2. For each tax period,  each member of the Affiliated  Group shall compute
its tax  liability  in  accordance  with the  provisions  of  Regulation  (beta)
1.1502-33(d)(3) with a fixed percentage of 100 percent and shall pay such amount
(including any increased  liability  allocated pursuant to such regulation above
any liability  allocated  pursuant to section 1552 of the Internal Revenue Code)
to the Parent.  For purposes of this  Agreement,  any liability for  alternative
minimum tax shall be treated as a tax liability subject to this paragraph.

     3. Payment of the  consolidated  tax liability  for a taxable  period shall
include the payment of estimated tax  installments  due for such taxable period,
and each Subsidiary shall pay to the Parent its share of each payment within ten
days of receiving notice of such payment from the Parent,  but in no event later
than the due date for each such  payment.  Any amounts paid by a  Subsidiary  on
account  of a  separate  return or  separate  estimated  tax  payments  that are
credited against the consolidated tax liability of the Affiliated Group shall be
included in determining the payments due from such  Subsidiary.  Any overpayment
of estimated  tax should be refunded to the  Subsidiary.  Any payments made by a
Subsidiary  to  the  Parent  under  this  Agreement,  including  payments  by  a
Subsidiary to the Parent of any estimated tax  installments due for each taxable
period,  shall be paid to the Parent,  even if the  Affiliated  Group as a whole
does not have any consolidated estimated tax liability for such period.

     4. To the extent  payments  received in respect of a taxable year by Parent
pursuant to paragraph 2, above,  exceed the  consolidated tax liability for such
period as a result of the  absorption  or  utilization  of  losses,  deductions,
credits or similar items of certain members against other members' income,  gain
or similar items, then the Parent shall pay such excess amount received to those
members  whose items were  absorbed  or  utilized  in a manner  that  reasonably
reflects  such   utilization  or  absorption   within  10  days  of  filing  its
consolidated federal income tax return for such period.

     5. If part or all of an unused loss or tax credit is  allocated to a member
of the Affiliated Group pursuant to Regulation (beta) 1.1502-79,  and is carried
back or  forward  to a year in which such  member  filed a separate  return or a
consolidated  return with another  affiliated  group, any refund or reduction in
tax liability  arising from the carryback or carryover shall be retained by such
member.  Notwithstanding  the  above,  the  Parent  shall  determine  whether an
election  shall be made  not to carry  back  part or all of a  consolidated  net
operating loss for any tax year in accordance with Section 172(b)(3).

     6. If the  consolidated  tax liability is adjusted for any taxable  period,
whether by means of an amended return, claim for refund, or after a tax audit by
the Internal Revenue  Service,  the liability of each member shall be recomputed
to give  effect to such  adjustments,  and in the case of a refund,  the  Parent
shall make payment to each member for its share of the refund, determined in the
same manner as in paragraphs 2 and 4 above,  within ten days after the refund is
received by the Parent,  and in the case of an increase in tax  liability,  each
member  shall  pay to the  Parent  its  allocable  share of such  increased  tax
liability  within ten days after  receiving  notice of such  liability  from the
Parent.

     7. If during a  consolidated  return  period the  Parent or any  Subsidiary
acquires or organizes another corporation that is required to be included in the
consolidated  return,  then such corporation  shall join in and be bound by this
Agreement.

     8. This  Agreement  shall apply to the tax year ending March 31, 1997,  and
all subsequent  taxable periods unless the Parent and the Subsidiaries  agree to
terminate the Agreement.  Notwithstanding such termination, this Agreement shall
continue  in effect  with  respect to any payment or refunds due for all taxable
periods prior to termination.

     9.  Notwithstanding any other provisions of this Agreement,  payment of any
estimated tax installment by a Subsidiary to the Parent under this Agreement for
the tax year ending March 31, 1997 shall be made on or before March 31, 1997.

     10. This  Agreement  shall be binding  upon and inure to the benefit of any
successor,  whether by statutory merger, acquisition of assets, or otherwise, to
any of the parties  hereto,  to the same extent as if the  successor had been an
original party to the Agreement.

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
executed by their duly authorized representatives on March 27, 1997.

                                        THE ASHTON TECHNOLOGY GROUP, INC.


                                        By:   /s/ Fredric Rittereiser
                                             Name: Fredric W. Rittereiser
                                             Title: President & CEO


                                        COMPUTER SCIENCE INNOVATIONS, INC.


                                        By:   /s/ George Milligan
                                             Name: George Milligan
                                             Title: President


                                        UNIVERSAL TRADING TECHNOLOGIES
                                        CORPORATION


                                         By:   /s/ Robert Eprile
                                              Name: Robert A. Eprile
                                              Title: President