Electronic Trading Consumer Confidence

During a recent interview with Barbara Walters, entertainer Barbra Streisand revealed her enthusiasm and love of online trading. She admitted she spends a majority of her free time making money, and, when asked by Walters about a rumor that designer Donna Karin had entrusted money to Streisand to trade for her, Streisand admitted the successful designer has given her $1 million, an amount she had doubled in six months. Streisand's enjoyment of electronic trading is symbolic of the growing popularity of electronic trading from everyone to the most savvy Wall Street broker to the most inexperience, first-time, investor. However, there have been many barriers preventing electronic trading from becoming more established than it has by now, including fear, and a lack of investor confidence as well as worries over transacting financial trades electronically. This analysis will discuss the phenomenon of electronic trading, while reviewing some of the barriers that have prevented it from becoming more established than it has up to now. A conclusion will address the life-cycle stage of the electronic trading industry as being partly responsible for its slow establishment.

Electronic trading is an idea whose time has come. A booming economy, tales of overnight success in the roaring stock market, and the advent of more secure and reliable forms of technology have prompted thousands of individuals to open electro

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explains how online brokers function and how to choose one. He shows how to open an account, how to fund it, and how to understand account balances and margin basics. He also compares the way the different exchanges execute trades and walks readers through the process of making a trade" (Rouse 1). As one can see from this description, electronic trading is in such an infancy stage that many people are completely unaware of how to trade this way even when they want to. The future economic success of online trading requires that more potential investors are culled from the ranks of those who are willing but unaware of how to go about investing electronically. Wary investors remain suspect of adopting electronic trading for many of the above reasons. However, this fear and lack of information on behalf of potential investors is compounded by regulatory agencies like the Securities and Exchange Commission (SEC) which remain suspect of electronic trading. The SEC was originally as uneducated about electronic trading as the majority of the public. However, electronic trading has been slowed because of regulatory concerns, monitoring, and new laws that are enacted as the industry continues to grow. Recently, the SEC enacted two

Category: Business - E