However with as many as 40 of all stock brokers

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and proprietary research reports. However, with as many as 40% of all stock brokers lacking much in the way of experience and with the rapid increase in the amount of investment information that could be accessed online, such arguments sounded increasingly shrill and self-serving. By early 1999, it was becoming apparent that full-service brokers needed to adapt to the new technology or risk seeing
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their client base evaporate. The landmark event occurred in June 1999 when Merrill Lynch, the world largest full-service broker, bowed to the inevitable and announced that it too would soon offer its clients the ability Toll Lynch to trade online for a fee of $29.95 for trades of up to 1000 shares. In addition, Merit changed its pricing structure for many individual clients, replaci cing structure for many individual client replacing a fee structure that was based on the number of trades with a new fat fee that allowed wlimited numbers of the suggested that more than 50% of ster owed unlimited numbers of trades. Forecasts results suggest that Merrill did the right thing. Soon after the introduction of Me stock trades by individuals would be online by 2001. The early eby individuals would be online by thading service, account transfers to rival firms dried Many of Merrill's clients en combination of its research and online trading made it a better value proposition ed. Many of Merrill's clients realized that the ng made it a better value proposition than discount online trading houses, such as E Trade, which could not offer the same depth and research ade, which could not offer the same depth and breadth of in late 2000, the online trading revolution an d to stall when the NASDAQ stock market began what would prove to be a 60% decline in value over the next twelve months. As the stock market imploded, the volume of online trading dried up. Schwab saw online trading volumes drop over 50% in the first six months of 2001, which decimated the company's
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bottom line, leading to a 60% fall in net income. The same happened at other former high-flying Internet stockbrokers, including E Trade, which lost money in 2001 on a 40% decline in online trading volume and declining revenues. It remains to be seen whether this represents nothing more than a temporary setback in the rise of online trading, or the end of the boom.
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