They are right. Trading online drives down costs for customers and profit margins for brokers. But not trading online is likely to drive such firms out of business in the long term, because they will lose market share to invaders from the US and their more nimble-footed domestic competition.
New portfolio management tools, such as those offered by Moneyworld and Compuserve, threaten many a mediocre stockbroker. Compuserve Portfolio, launching this month, is available free from Compuserve's Money Channel.
You don't have to be a Compuserve subscriber to use it, since the portfolio is available on the Web. But use a Netscape browser and you may have difficulties. Compuserve admits the site has been "optimised" for use with Compuserve's own browser or Microsoft's Internet Explorer.
The Compuserve Portfolio includes coverage of six major stockmarkets: London, NYSE, Nasdaq-Amex, Frankfurt, Amsterdam and Paris. There is no limit to the number of elements you have in a portfolio and it offers charting functions and technology to inform you when prices move outside your set parameters.
Nick Saalfeld, senior producer at Compuserve's Money Channel, says the service will not stand still. "We will be rolling out additional functions, such as alerts by phone, news management, dealing and personalisation."
The world of personal finance on the Internet is a a small one. Before Nick Saalfeld joined Compuserve last year, he was with Moneyworld, which rolled out its own portfolio management offering back in June.
Moneyworld's Portfolio has unique features, including the ability to calculate the percentage change in the investments held in the portfolio since you bought them. Moneyworld allows you to list assets other than shares within its portfolio tool. It also offers a free company annual reports service at the click of a mouse button.
The Moneyworld and Compuserve offerings are powerful tools for the personal investor. Nearly all other portfolio management services available on the Internet require you to pay for information. Using one or the other of these services with cheaper online execution-only brokerages will put the private investor on an equal footing with most so-called market professionals.
Another recent addition to the Web is the AA Insurance online quote. It offers a 10 per cent discount on motor insurance policies, and the AA claims to be offering 400 car insurance quotes every day over its website. Once you enter your details, a quote appears on screen. If you wish to buy the policy, you click on the "Call Me" button and specify when you want the AA to phone you to conclude the transaction.
Compuserve Portfolio: www.compuserve.co.uk/ portfolio
AA Insurance: www.theaa.co.uk
Robin can be reached at RobinAmlot@aol.comReuse content