ONLINE STOCK TRADING

A brief thesis on Online Stock Trading
Online traders can become too aggressive, and it can be very easy to lose one's shirt. It is not uncommon for avid traders to roll over their 401k funds or other investments -- only to lose everything in the stock market. It's "a double-edged sword," said Kenneth Prather, owner of Prather Investment Management.Online securities trading was a big fad a few years ago, but some of the major players disappeared from the scene after the dot-com fallout. However, many do-it-from-home traders cannot resist the Internet's speed and convenience, and there are still plenty of firms to accommodate them.

Although some major brokerage companies swore they would never offer access to electronic trading tools, many quickly learned that customers were eager to trade via the Internet, and realized they would need to provide services or lose them to the competition.Currently, online trading is gaining credibility.Electronic storefronts offer consumers dedicated Web sites, software and online trading tools to help them go it alone. Some online investing firms have begun offering limited to full professional investment consulting services for a fee.

"Online trading is more than a passing fad. Many individual investors are using online brokers today," Fred Ruffy, an analyst at Optionetics, told TechNewsWorld.

The cost of trading online is generally lower than at brick-and-mortar brokerage houses. In addition, improvements in technology and security have made online trading an efficient and safe experience. In fact, some online brokers, such as E-Trade and TD Ameritrade, offer more than just trading. They also provide credit cards, mortgages, bonds and mutual funds, for example.Stiff CompetitionOnline trading has rendered phone brokers obsolete. Before the dot-com bubble burst, a phone trader working late at night at a big-name brokerage firm would fieldroughly 300 calls per shift.When online trading began to gain popularity, many phone traders were laid off, due in part to a decline in sales Email Marketing Software - Free Demo volume. The interest in online trading is even more intense now."We see a burst of activity. It's going up and down, but always there are those investors who want to do it themselves," said Andy Rolfe, CTO of Authentify.

The number of online traders has been increasing, apparently in spite of scams -- or the fear of scams. "People believe in the institutions that exist online," said Rolfe.