BLACKSQUARE

American stock market has two main types of broker service. First one is traditional and the most well-known – so called full service brokerage. The meaning is that every client has personal broker – licensed financial consultant whose task is proper valuation of client’s financial performance, his investing goals and demads, sensitivity to risk and further development and realization of individual investing strategy that is the most appropriate to the specific customer. The second type that recently is acquiring more and more popularity is discount brokerage. Here the customer realizes what, wherе and in what amount should he buy and sell, and the broker’s mission comes only to providing the customer the maximum comfortable conditions for independent merket entry. Investing with the help of discount-brokers is also called online investing because mostly one of the main binding links of customer-broker-market chain in this case is Internet network. Today every seventh operation with stocks is made through Internet, for the first quarter 1999 online trade volume have grown by 30 percent. Investors are attracted bh the low service cost, free access to the market investigations and the convenience of working with online account.

So, one of the main online investing advantages is an essential funds economy in operations with securities. The economy is achieved first of all at the expense of the lower commission collected by the brokers company for operations fulfillment. Unlike the commission at the sum of $100-$175 that is collected by the traditional brokers companies, the amount of online brokers commissions varies from $8 for operation (Ameritrade and Suretrade) to $30 (Charles Schwab). Limit orders where the bargain execution cost is stated may cost by several dollars more. Besides the important factor is the amount of the minimal deposit on the broker’s account. Some online brokers companies, for example, DLJdirect and Suretrade, don’t require minimal deposit for account opening, at the same time the majority of online brokers require minimal deposit at the sum from $1000 to $2000 for the beginning of operation with account.

The second important advantage is the presence of twenty-four-hour online access of the customer to his account, that is updated every day (or even in the real time order). Thus you can know your portfolio exact cost any time. All account changes come at the end of the trade day according to the results of auction closing. In spite of that fact that request for sale or purchsse can be fulfilled only after exchange opening, and you can place it night and day. If the request is place after the closing it will be automatically enetered into the trade system to the moment of auction opening the next day. It is very important when you are in different time zones with New-York.

The majority of online brokers represent their users wide market investigation possibilities including reviews, quotations, diagrams and company’s news. Besides there are many sources that are specialized in such information (for example, CNET Investor, Yahoo Finance, MSN MoneyCentral Investor and CBS MarketWatch web sites). Thus the investor gets the access to the large amount of information necessary for decision making.

At last if you have online account you an effectively watch the market situation and your stocks behavior. Although you can get such information from the traditional broker by telephone, online account allows you to acquire quotation much faster and as often as it is necessary. Thus if you have to make an operation you can obtain the quotation of the stock you are interested in by the moment of request introduction that helps to valuate at what price it will be executed (in the case of the request of “buy for market cost” type).