Word: trading
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Dates: during 1990-1999
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...allure of do-it-yourself trading is transforming both Wall Street and Main Street. Traditional brokerages, whose lock on vital information made them the market's gatekeepers, are changing their approach, and their fees. Meanwhile, a frenzied mob of e-traders has linked itself to a rapidly growing number of web trading sites. Today there are over 60 e-brokers, more than twice the number of a year ago. Many are electronic branches of such giants as Charles Schwab and Fidelity Investments, but others, like E*Trade and Datek Online, dwell mainly in cyberspace. The e-brokerages themselves have been...
Buying and selling securities have never been cheaper. Price wars last year slashed the average commission at the 10 largest e-firms from $34.65 to $15.95 a trade. (A trade now costs more than $50 at standard off-line discounters and at least twice as much at full-service firms.) Aggressive discounters on the Internet charge less than $10, and cutthroats such as Web Street Securities charge nothing--that's zilch--to handle trades of more than 1,000 shares of NASDAQ stocks. This rock-bottom pricing reflects the lower costs of e-trading--look, Ma, no broker...
...biggest hazard of e-trading is trading. The ability to buy and sell stock instantly should not be confused with the word investing. Hooked hackers often trade many times a day in the hope of profiting from fractional changes in the price of a stock--a risky practice called "day trading" that can swell commissions while shrinking portfolios. "The easier it becomes to trade, the greater the danger that you'll trade too much or make poor decisions," Burnham says...
...market leader has been Charles Schwab, which commands nearly a third of the online trade business--or 1.5 million accounts--despite a $29.95 commission, which is three times higher than the deep discounters charge (see chart). Schwab's secret has been to knock down the wall between its online business and its 5 million regular account holders, giving everyone access to the entire range of products and services available at the firm. These include round-the-clock, dial-up brokers and technical support, and a financial supermarket that offers 1,500 different mutual funds...
Meanwhile, Schwab's rivals are rolling out some fancy features of their own. E*Trade, which has more than 400,000 accounts with $10.2 billion in assets, last year acquired OptionsLink, an electronic service that helps companies manage employee stock-option plans. Datek offers free real-time stock quotes--a service that most brokers charge for--and promises to execute trades within one minute or refund the commission. That has helped make two-year-old Datek, which has 80,000 active accounts, the fastest growing e-broker, measured by daily transactions...