Online trading companies logged an average of 340,000
stock and mutual fund
trades a day in the fourth quarter of 1998, up 34 percent from the second
quarter, according to published reports.
Toronto-Dominion Bank’s Waterhouse Investor Services had the biggest increase
in market share for the second consecutive quarter, according to a report from
Credit Suisse First Boston Corp.
Waterhouse passed E*Trade Group Inc. to
move into second place, adding 1.9
percentage points to reach 12.4 percent of average daily trades, Bill Burnham,
an electronic commerce analyst at Credit Suisse and the report’s author, told
Bloomberg News.
Charles Schwab Corp., the biggest online
brokerage, lost 2.9 percentage points
in the quarter, finishing with a 27.4 percent share based on 93,000 daily
trades, Burnham was quoted as saying.
E*Trade gained share, adding 0.9 percentage points to reach 11.7
percent. Datek Online Brokerage Services
Inc. added 1.6 percentage points to
reach a 10
percent share, passing Fidelity
Investments to move into the No. 4 spot.
The continued growth in U.S. online trading volume, from a 253,000 daily
average in the third quarter, came as investors snapped up Internet stocks,
with the Inter@ctive Week index of 50 Internet stocks rising 71 percent during
the three months. Burnham’s report is said to be a benchmark for the online
trading industry,.
“The close correlation between online trading growth and Internet stock volume
growth is really not surprising given that online traders are, by definition,
Internet users and therefore much more likely to be aware of and interested in
Internet stocks,” Burnham said. Online trades accounted for
almost one in seven U.S. stock trades in the fourth quarter.
