Online Stock Trading..


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Online Stock Trading..

  1. 1. Online Stock Trading By: Jennifer Albanese
  2. 2. Overview of Online Trading <ul><li>The days of keeping in constant contact with a broker and paying a fortune for stock trades are over. Today, more then half a million trades are made everyday online. Thanks to the internet, people can now make trades just about anywhere from their couch, their lunch break or on the go. </li></ul>
  3. 3. Overview of Online Trading <ul><li>Customers can now buy and sell stocks, options, bonds, and other financial instruments using online broker’s web sites and systems </li></ul><ul><li>There are so many broker’s to choose from. Some of the most popular ones are </li></ul><ul><ul><li>Charles Schwab </li></ul></ul><ul><ul><li>Etrade </li></ul></ul><ul><ul><li>Ameritrade </li></ul></ul><ul><ul><li>Datek Online </li></ul></ul>
  4. 4. Advantages of Online Trading <ul><li>Extended hours of trading </li></ul><ul><li>Several forms of online research (public and exclusive) </li></ul><ul><li>Cheaper trades </li></ul><ul><li>Complete control of your investing decisions </li></ul>
  5. 5. Top Websites- E*Trade <ul><li>Costs </li></ul><ul><ul><li>$15 per trade </li></ul></ul><ul><ul><li>$15-$35 for broker assisted trades </li></ul></ul><ul><li>Key Benefits </li></ul><ul><ul><li>Chat rooms, message boards, real-time account information, automates performance reporting </li></ul></ul><ul><li>Downfalls </li></ul><ul><ul><li>Three tier membership makes website difficult </li></ul></ul><ul><li>Recommendations </li></ul><ul><ul><li>Traders who focus on long-term returns </li></ul></ul><ul><ul><li>Traders who buy stocks and hold them for years </li></ul></ul><ul><ul><li>Users who are looking for services and research </li></ul></ul>
  6. 6. Top Websites- Ameritrade <ul><li>Costs </li></ul><ul><ul><li>$8 per trade </li></ul></ul><ul><ul><li>$12-$18 for broker assisted trades </li></ul></ul><ul><li>Key Benefits </li></ul><ul><ul><li>Customized email alerts, very good customer service </li></ul></ul><ul><li>Downfalls </li></ul><ul><ul><li>Does not provide streaming data or Nasdaq level II quotes </li></ul></ul><ul><li>Recommendations </li></ul><ul><ul><li>Investors who buy and sell stocks frequently </li></ul></ul><ul><ul><li>Investors who are looking for cheap trades and prompt executions </li></ul></ul>
  7. 7. Top Websites- Charles Schwab <ul><li>Costs </li></ul><ul><ul><li>$29.95 or $14.95(for active traders) per trade </li></ul></ul><ul><ul><li>$35-$39 for broker assisted trades </li></ul></ul><ul><li>Key Benefits </li></ul><ul><ul><li>Real-time account information, easily navigable website, excellent research </li></ul></ul><ul><li>Downfalls </li></ul><ul><ul><li>Fairly expensive trades </li></ul></ul><ul><li>Recommendations </li></ul><ul><ul><li>Traders who focus on long-term returns </li></ul></ul><ul><ul><li>Traders who buy stocks and hold them for years </li></ul></ul><ul><ul><li>Users who are looking for services and research </li></ul></ul>
  8. 8. Top Websites- Fidelity <ul><li>Cost </li></ul><ul><ul><li>$15 per trade </li></ul></ul><ul><li>Key Benefits </li></ul><ul><ul><li>Extensive email and wireless alert capabilities such as price triggers and new issue offerings </li></ul></ul><ul><li>Downfalls </li></ul><ul><ul><li>Less then average customer service, limited online transaction history </li></ul></ul><ul><li>Recommendations </li></ul><ul><ul><li>New online investors </li></ul></ul><ul><ul><li>Investors who desire a physical branch to visit </li></ul></ul>
  9. 9. Wireless Technology &Trading <ul><li>Trades stocks anytime, anywhere just by tapping your PDA, phone or pager. </li></ul><ul><li>Designed for very active traders </li></ul><ul><ul><li>Those who place over 20 trades a month </li></ul></ul><ul><li>Advantages </li></ul><ul><ul><li>Receive alerts </li></ul></ul><ul><ul><li>Data access </li></ul></ul><ul><ul><li>Often a more secure network then general internet (Sprint PCS) </li></ul></ul>
  10. 10. Services Provided $30 and up, plus $55 monthly service fee Quotes, alerts, trades. account information, and news from Palm IIIx and Vx devices (RIM pagers and web enabled phone to follow) Charles Schwab $8 Quotes and trades from Palm wireless devices and Sprint PCS Web phones Ameritrade COST OF TRADES ACTIVITIES/ PLATFORMS BROKER
  11. 11. Services Provided $15 updates, and news from Palm devices, AT&T PocketNet, Verizon and GTE wireless phones E*Trade $14 and up Trades and information from Palm wireless devices two-way pagers and web-enabled phones Suretrade COST OF TRADES ACTIVITIES/ PLATFORMS BROKER
  12. 12. Other Brokers Providing Wireless Services <ul><li>DJLDirect </li></ul><ul><li>Fidelity </li></ul><ul><li>Morgan Stanley Dean Witter Online </li></ul><ul><li>TD Waterhouse </li></ul>
  13. 13. Problems Online <ul><li>Broker’s site goes down </li></ul><ul><ul><li>What do you do? </li></ul></ul><ul><ul><ul><li>Call Broker and talk to a live person or use tuch-tone service </li></ul></ul></ul><ul><ul><ul><li>If available, visit a physical office nearby </li></ul></ul></ul><ul><ul><li>How do you prevent it? </li></ul></ul><ul><ul><ul><li>Not much you can really do </li></ul></ul></ul><ul><ul><ul><li>Have accounts at several firms </li></ul></ul></ul>
  14. 14. Problems Online <ul><li>Double orders or no cancellation </li></ul><ul><ul><li>What do you do? </li></ul></ul><ul><ul><ul><li>Do not trust email notifications- your order may not have actually been reversed </li></ul></ul></ul><ul><ul><ul><li>Phone your broker and have someone check for you </li></ul></ul></ul><ul><ul><ul><li>Attempt to call and beg to have the order cancelled if it has gone through, doesn’t work very often </li></ul></ul></ul>
  15. 15. Problems Online <ul><li>Bad customer service </li></ul><ul><ul><li>How do you prevent this? </li></ul></ul><ul><ul><ul><li>Thorough research of companies </li></ul></ul></ul><ul><ul><ul><li>Keep a close eye on all monthly statements, trade reports or electric confirmations </li></ul></ul></ul><ul><ul><ul><li>If you call customer service, take notes and get support agent’s name. </li></ul></ul></ul>
  16. 16. What’s in the future <ul><li>All brokers offer online trading? </li></ul><ul><li>Online trading mostly wireless? </li></ul><ul><li>Even cheaper trades? </li></ul>