Online investing has taken off like a rocket on the world wide web. Despite initial doubts and scepticism by even
leading stock trade experts who predicted that it was just a passing
fad that would not last, it is now very clear that online stock trading
is here to stay.
The Internet has revolutionized stocks and trading to the extent where many
Wall Street big names have had to abandon their carefully worked out
business plans for new ones that include a central key role for the
world wide web to play. It is clear that the investing public have
warmly embraced this technology and exciting new medium as a key
investment tool and way of doing business and trading stocks.
The attraction to online investing through trading is based on many
advantages, but the most obvious has to be the fact that online trades
and brokers are so cheap. Prices of as low as $5 have been quoted for
online trades.
When online investing brokers emerged for the first time around 1996, it was
the discount brokerage invasion of the mid 1970s all over again. The
rise of discount brokers was triggered off by the decision of the
Securities and Exchange Commission to abolish fixed stock commissions.
In a way this also helped to pave way for the rise of online brokerages
later. With online brokers, the impact on Wall Street was destined to
be much bigger so that the discount brokerage revolution has paled in
comparison.
Some traditional offline brokerages whose income has been under tremendous
pressure and threat, have made an effort to point out that investors
who go online miss the valuable advice, experience and tips which only
a traditional broker can give. However this has not held much sway and
has quickly been discounted by many online investors who realize that
nobody can accurately predict the future and many times an investor
trading stocks online and using the power of the internet to get
information, can easily end up with similar results and in some cases
an even better performing portfolio.
Then there is the fact that stock brokers in general have never fully won an
image of total honesty in the eyes of the investing public. With the
persistent complaints of some brokers pushing stocks that are
underwritten by their brokerage firms at the expense of the performance
of their client's portfolio, this image has continued to suffer.
Promoters of the online trading opportunity have never missed an
opportunity to emphasize on this and to quickly point to the advantage
that online trading brings in finally ridding investors of brokers
whose honesty may be in doubt.
