Market frenzy boosts e-trades
With the stock market in significant decline, nervous investors appear to be trading via the Internet more than ever before.
Brokerage Charles Schwab said the total volume of its electronic trades was up about 10 percent yesterday when the Dow fell 299 points--its biggest drop of the year. A spokesman for the company said that final numbers for today's trading activity have not yet been tabulated, but that they look the same, if not a little busier.
"Across the board, we saw about a 10 percent increase in hits and an even greater increase in the number of orders placed [online yesterday]," said Vincent Phillips, Schwab's vice president of Web systems.
The Internet has spawned numerous sites dedicated to real-time financial information and stock market research, allowing anxious investors easy access to stock quotes. Some brokerage sites now offer trades for as little as $7.95, and recent days have seen an increasing number of investors rushing to take advantage of their instant access.
"In times of volatility, the online channel is the easiest, quickest, and most effective way to go," Phillips said. "When things start to get hot, like yesterday, the Internet is the place people go."
More than half of Schwab's business now comes from online traders, the company recently revealed.
Meanwhile E*Trade, another leading online brokerage, averages about 29,000 trades a day, according to spokeswoman Elisabeth Weiner.
"In recent weeks volume has been something north of that," Weiner said. "Generally, there's been more activity, but it's still in the range that we consider normal."
E*Trade is on an ambitious plan to add 1 million new customers within the next eight months, a company executive said recently.
The company is busy rolling out a new portal-like financial site called Destination E*Trade in an attempt to get an edge in a competitive field that includes SURETRADE, Ameritrade, DLJdirect, Fidelity.com, Datek, and the new WellsTrade, among others.