US Online Brokerage Update: The Click and Mortar Evolution Continues

December 6, 2000

Abstract

Boston, MA, USA,  December 12, 2000

Commissions for Online Trading Sharply Down  Report Published by Celent

In a new report entitled "US Online Brokerage Update: The Click-and-Mortar Evolution Continues," Celent Communications finds that commissions for online trading in Q3 2000 have dropped by over 30% compared to only 2 quarters ago. This reduction is due in part to sharply lower trading volumes, but also because of ever increasing competitive price pressure. This new report by Celent evaluates each of the major online brokerages in the US, eleven in all, and examines how they are adapting to a rapidly changing environment.

A Table of Contents for this report is available online.

Many online discount brokers, once focused on providing low commission trading and little else, are scrambling to add additional products, research and especially new channels to capture mainstream investors in the face of these quickly decreasing commissions. Without these enhanced services, these firms face a dim future: low growth and decreasing market share. Along with the online discount brokers, full-service firms are also moving online in an attempt to capture this lucrative potential customer base.

According to Fritz McCormick of Celent, "The changes taking place in the US online brokerage market represent a significant threat for those firms that do not adapt with the times. No longer focused on early-adopting online investors, the market is increasingly being comprised by mainstream investors. These are investors with an increased desire for financial advice and planning, both online and off, as well as a much higher average account balance."

The report includes a comprehensive overview of the current state of the online brokerage industry in the US. Additionally, each of the main online brokerage firms is closely evaluated, based on strategy, future prospects and current growth metrics. The firms covered in this report include:

  Ameritrade Charles Schwab Datek DLJDirect E*Trade Fidelity NDB Scottrade Suretrade TD Waterhouse Web Street

Celent is a research and advisory firm dedicated to helping financial institutions formulate comprehensive business and technology strategies. Celent publishes reports identifying trends and best practices in financial services technology and conducts consulting engagements for financial institutions looking to use technology to enhance existing business processes or launch new business strategies. With a team of internationally based analysts, Celent is uniquely positioned to offer strategic advice and market insights on a global basis. Celent is a member of the Oliver Wyman Group, which is a wholly-owned subsidiary of Marsh & McLennan Companies [NYSE: MMC].

Media Contacts

North America
Michele Pace
mpace@celent.com
Tel: +1 212 345 1366

Europe (London)
Chris Williams
cwilliams@celent.com
Tel: +44 (0)782 448 3336

Asia (Tokyo)
Yumi Nagaoka
ynagaoka@celent.com
Tel.: +81 3 3500 3023

Table of Contents

 

US Online Brokerage Update:  The Click-and-Mortar Evolution Continues

Return to report Abstract.

INTRODUCTION  3
INDUSTRY OVERVIEW  4
MARKETPLACE  5
  Industry Trends  8
  The Rise of e-brokerage  8
  Saturation of self-directed investors  9
LEADING ONLINE BROKERS  11
  Ameritrade  14
  Charles Schwab  15
  Datek  16
  DLJDirect  17
  E*Trade  18
  Fidelity  19
  NDB  20
  Scottrade  21
  Suretrade  22
  TD Waterhouse  23
  Web Street  24
CONCLUSIONS 25
 
        

Sign in to download reports and access personalized information