| To: TFF who started this subject | 2/23/2001 3:11:04 PM | | From: TFF | | | | ATTENTION QCHART USERS - THERE IS HOPE:
groups.yahoo.com
Generation V is the code name for the fifth generation financial server written by Eric Scott Hunsader. The 4th generation was Continuum/QFeed which continues to power QCharts and Livecharts (Quote.com).
Join the group and show your support. Hopefully we can get this feed running with RavenQuote. |
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| To: LPS5 who wrote (8756) | 2/24/2001 11:02:50 AM | | From: TFF | | | | CME's GLOBEX®2 E-mini Index Extend Volume Records For Second Day
Feb. 23, 2001—For the second consecutive day, volume on Chicago Mercantile Exchange Inc.’s (CME) GLOBEX®2 electronic trading system reached record levels, with 343,193 contracts changing hands on Thursday, Feb. 22. In addition, volume in CME’s
E-mini S&P 500 and E-mini Nasdaq-100 futures contracts set new records of 160,134 and 139,943, respectively, also their second consecutive new high marks.
The records beat those set on Feb. 21, when 306,417 contracts traded on GLOBEX2, including 147,028 E-mini S&P 500 and 126,645 E-mini Nasdaq-100 contracts. Last week, records were set on Feb. 14 at 297,100 for GLOBEX2, 138,187 E-mini S&P 500 contracts and 126,045 E-mini Nasdaq-100 contracts.
As the fastest growing contracts in CME history, the E-mini index products provide customers with risk management and asset allocation choices in a broad-based market index and in the volatile technology sector. Each E-mini S&P 500 futures contract, sized at $50 times the index level, represents an underlying value of $62,875 as of yesterday’s close. For E-mini Nasdaq-100 futures, each contract is sized at $20 times the index, or an underlying value of approximately $41,000.
The electronically traded indexes are available to customers virtually around the clock from 3:45 p.m. until 3:15 p.m. the following day.
Chicago Mercantile Exchange Inc. (www.cme.com) is an international marketplace that brings together buyers and sellers on its trading floors and GLOBEX2 around-the-clock electronic trading system. CME offers futures contracts and options on futures primarily in four product areas: interest rates, stock indexes, foreign currencies and agricultural commodities. On Nov. 13, 2000, CME finalized its transformation into a for-profit, shareholder-owned corporation as it became the first U.S. financial exchange to demutualize by converting its membership interests into shares of common stock that can trade separately from exchange trading privileges. The exchange moves about $1 billion per day in settlement payments, manages $25 billion in collateral deposits and administers more than $1 billion of letters of credit.
S&P, S&P 500, Nasdaq, Nasdaq-100 and other trade names, service marks, trademarks and registered trademarks that are not proprietary to Chicago Mercantile Exchange Inc. are the property of their respective owners, and are used herein under license.
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| To: $Mogul who wrote (8773) | 2/25/2001 7:53:37 AM | | From: TFF | | | | | Nice find. I wonder if the rest of the daytrading platforms will offer globex trading access. I know that alot of the futures direct order entry platforms are adding access to equity markets. |
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| To: TFF who wrote (8774) | 2/25/2001 12:29:38 PM | | From: Jon Tara | | | | Unfortunately, you still have to trade in a separate account.
Can you at least transfer funds between accounts? |
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| To: TFF who started this subject | 2/26/2001 6:46:42 AM | | From: supertip | | | | Ameritrade to Launch Three New Online Trading Brands
ALL THINGS TO ALL PEOPLE: In efforts to tailor its products to
cover all segments of online investing, Ameritrade said it will
soon offer three new trading brands. Ameritrade Pro will be
geared towards the highly active professional and semi-
professional trader, while Ameritrade Plus will provide a higher
level of personalized investing services. The third, Freetrade,
is intended to be a virtual, commission-free transaction
platform. The regular Ameritrade brand will continue to exist as
the value-oriented approach to self-directed investing.
Ameritrade Pro, which will offer quick trading executions and
access to more advanced stock quotes, is being created to
capitalize on the firm's planned $67.3 million acquisition of
Houston-based software provider TradeCast, which offers direct-
access trading through online trading software that connects
customers to exchanges. Ameritrade Plus will be the most
expensive offering, the company said in a statement, without
mentioning what features will be the focus of the new brand. |
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| To: TFF who started this subject | 2/26/2001 7:02:21 AM | | From: supertip | | | | DOWNTURN BRINGS CHANGES TO ONLINE BROKERAGE SECTOR
FIRMS CUT BACK ON PRICEY ADS, EXPAND SERVICES
By Lisa Singhania
Associated Press
February 25, 2001
NEW YORK -- "Be your own sugar daddy," advised one humorous TV ad featuring a young man massaging a rich, elderly woman's gnarled and buniony feet. In another, a tow truck driver is shown on his own tropical island, a product of his success trading stocks on the Internet.
Online brokerages once competed fiercely to outdo each other's irreverent come-ons, but that was before the bull market fell on tougher times. Now the leading e-brokers are vying to remain viable as their customers slow down what had been a frenetic trading pace.
At the same time that they're curbing pricey ad campaigns, they're expanding their services and beefing up their technology in an effort to stand out.
"It used to be exclusively about cheap trades, but customers now want broader product offerings, advice, different access points for their money and maybe even bank branches," said Matt Vetto, an analyst with Salomon Smith Barney.
The push-the-envelope advertising has been toned down, replaced by more conventional marketing.
No middlemen, the latest technology and quicker trades at the best prices, promises an ad for Datek Online. CyBerCorp.com, a Charles Schwab & Co. subsidiary, uses black and white footage of Bruce Lee to compare trading to hand-to-hand combat.
Schwab ads also tout its Webshops--educational seminars that introduce customers to online trading. Fidelity Online Brokerage tells customers that wireless stock quotes are in their future, while an Ameritrade ad contrasts an assured young woman using its research and trading tools with a condescending, stodgy traditional brokerage client.
"They have all gone from brand awareness to brand message," said Scott Appleby, a technology analyst at Robertson Stephens. "The ads of the past were really eye-catching, but now they're moving to a message of value--why you should invest with them instead of someone else."
So far, Wall Street has struck a wait-and-see posture. The stock prices of some of the biggest e-brokerages--Schwab, E*Trade Group Inc., TD Waterhouse Group Inc. and Ameritrade Holding Corp.--have fallen 60 percent or more in the last year, and the short-term picture isn't expected to improve soon.
The market downturn has also brought cost control. Schwab recently imposed temporary salary cuts for 750 employees, including its two chief executives, and Ameritrade said it would lay off about 300 workers to cut expenses because of the drop in trading activity.
"An overall down market causes people to trade less," said Glenn Schorr, an analyst with Deutsche Banc Alex. Brown. "That means lower trading revenues, which causes online brokerages to pull in marketing expenses ... and that produces even lower growth rates for new accounts."
Still, a number of investment firms remain bullish on the industry's prospects, particularly because they don't see the supply of potential consumers running out any time soon.
"A lot of the growth in this industry is going to come from mainstream America--people who don't have brokerage accounts today or haven't done a lot of investing ... and traditional brokerages no longer have an advantage over online trading," said Greg Smith, an analyst with J.P. Morgan H&Q.
Smith's research shows that although the number of online trades dropped 12 percent between the second and third quarters of 2000, the most recent data available, they were still up 81 percent from the same time the previous year.
"Things should start to look up," he said. "The first quarter is the time of year when people invest their year-end bonuses, reposition their portfolios and open IRAs."
Debate remains about what online brokerages need to do to make money in an environment where trading volume is unpredictable.
E*Trade, for example, has rolled out a national ATM network, and plans a New York storefront with some customer service. The online brokerage also ramped up its investor research tools and has acquired a mortgage loan business.
Others, including CSFBdirect.com, are targeting more affluent accounts with promises of top-level customer service, research and access to initial public offerings. The hands-on attention mirrors what traditional brokerages have done for years to attract business.
"Today our average account size is about $60,000 per customer. Now we're targeting the higher-end investors with assets over $100,000," said Glenn Tongue, president of CSFBdirect.com.
"Many of the online brokers out there are attracting customers with very low asset levels and you can't make money off of them unless they trade a lot, which right now they aren't."
Looking overseas for new customers is another trend, although analysts aren't convinced that's a long-term solution, given currency volatility and cultural differences.
There are other niches, too. Datek has focused on technology upgrades that target the most frequent traders, including real-time trading and allowing customers to direct orders to the market maker or electronic trading network of their choice. Ameritrade boasts of low-cost and speedy trades.
Then there's competition from traditional brokerages, like Schwab and Fidelity, that already have the physical base. They are using their online offerings to hang on to customers interested in Internet trading who might otherwise go to other e-brokers.
"Our online customers are also our offline customers," said Tracey Esherick, executive vice president at Fidelity Online. "They're using the online area for some routine transactions and stock analysis, but they're still using our phone representatives and sitting down with branch representatives." |
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| To: TFF who started this subject | 2/26/2001 12:06:17 PM | | From: TFF | | | | Fortune - ETF's...ETF futures next?
Exchange-traded funds have revitalized the industry and attracted billions from investors. Which one is best for your portfolio?
Lee Clifford
ETFs can be ideal for plugging holes in your portfolio If you want to ... Then consider ...
Get broad market exposure through an index
Barclays iShares or Standard & Poor's SPDRs. Both are cheaper and more tax-efficient than traditional S&P index funds.
Diversify a portfolio and cut your exposure to tech stocks
iShares S&P Small Cap 600 or Russell 1000 Value. They have lower technology weightings than the major indexes.
Focus on a particular slice of the global market
Sector and country ETFs. They let you buy a collection of stocks, or an entire index, with one transaction.
If you've watched any non-Tivo TV lately, you have no doubt seen the omnipresent Barclays commercials for exchange-traded funds, or ETFs. In one spot a well-dressed woman prowls a high-end store and picks up a bar of Scottish Mist soap. Her eyes widen when she sees the label: made in south korea. Auntie Mae's Old American Chocolates? Also made in South Korea. Tasty Traditions Matzo Ball & Soup mix? Ditto. Then comes the tag line: "Spotted a trend? Buy it."
You might say the same thing about ETFs themselves. Traded under quirky names like Spiders, Cubes, and iShares, ETFs let you purchase baskets of stocks—meaning specific indexes, sectors, or countries—with a single transaction. In one fell swoop you can buy or sell a U.S. real estate index, an array of wireless stocks—and, yes, even the brunt of the South Korean stock market.
Since these new stock/fund hybrids were introduced on the American Stock Exchange in 1993, interest has exploded to the point where they're now giving traditional funds a run for their money—literally. Some 94 different ETFs currently trade on the Amex, totaling about $80 billion. And in December cash flowing into ETFs nearly equaled mutual fund inflows, according to the Investment Company Institute. Says Cliff Weber, senior vice president of new-product development at the Amex: "They've doubled in assets and in volume every year for the past four or five years, and we think we're still in the very early part of the growth phase." (See also "Along Came the Spiders" and "Cube Stake: Why the Nasdaq 100 Sizzles," in the fortune.com archive.)
That success stems from the major structural advantages that ETFs have over old-fashioned index funds. For starters, they trade throughout the day, just like stocks. (By comparison, you can only buy or sell mutual fund shares each afternoon at the market close, when the fund reprices its holdings.) You can also buy ETFs on margin and, in most cases, sell them short. Plus, these new entities are less expensive to run, meaning lower management fees. Barclays' S&P 500 iShares, for example, siphon off just nine basis points, or 0.09% of the value of your investment. The equivalent Vanguard 500 Index fund—one of the cheapest mutual funds around—has an annual expense ratio of twice that. But be warned: Every time you buy an ETF, you pay a trading commission. So if you're flipping them like pancakes, it will cost you.
ETFs also have a bigger advantage when it comes to tax efficiency (something you'll appreciate if any of your mutual funds lost money in 2000 and then stuck you with a taxable distribution). When investors redeem shares in a standard fund, the manager is often forced to sell stocks that have appreciated in order to raise cash. That triggers a capital gains hit for the remaining investors, even if the fund finished down in a given year. However, ETF redemptions are just like selling stock, so you won't get hit with capital gains taxes when other investors cash out. "If you're going to take a passive approach [to investing], your only alternative is an index fund," says Robert Levitt, a financial planner based in Boca Raton, Fla. "But ETFs are cheaper, easier to trade, and more tax efficient."
Having said all that, these new financial instruments are still very much a work in progress. Many of these baskets only recently began letting people reinvest their dividends, and they aren't set up for dollar-cost averaging (investing the same amount periodically), meaning investors who want to stash away $100 every two weeks would be better off in a no-load mutual fund, where they don't have to pay broker commissions. There have also been some red flags raised about liquidity for some of the newer, more sparsely traded issues, a complaint that ETF boosters are quick to contest. "People say they're illiquid because they don't see very many shares trade, but as long as they're created with underlying stocks that do trade, it's a nonissue," contends Levitt. That may be true for an S&P 500 basket, but don't count on the same liquidity with the Korean Kospi.
By their nature, we should add, some ETFs are more tax-efficient than others. You'll still have to pay taxes whenever an index is rejiggered, forcing a manager to sell stocks that have been dropped. That can lead to a distribution—and capital gains—that you can't control. While the S&P 500 is recomputed only a few times each year, stocks are constantly outgrowing small-cap and value indexes, meaning managers have to sell those companies to keep their portfolios in line.
The tax issue with foreign indexes gets even more complicated. Why? Fund administrators labor under SEC requirements that force them to sell off a company whose share of the index gets too large (for example, Nortel on the Canadian market). Several foreign iShares baskets, in fact, have already paid out unexpected capital gains distributions because of this, to predictably irate shareholders.
Finally, there is such a thing as overkill, say some financial planners, who would be loath to put their clients' money into, say, an e-commerce basket or one that tracks the Malaysian stock index. "Some of the providers are getting a little out of hand," says Chris Cordaro, a financial planner at Bugen Stuart Korn & Cordaro in Chatham, N.J. "Do we really need to segment the market that much?"
Weighing all these attributes—the good and the bad—we culled through the current ETF offerings to find those most useful to a typical portfolio. We found three specific uses for them: tracking major indexes, rebalancing your portfolio, and getting exposure to a remote corner of the market. Here are the best baskets for each.
T racking a broad index: You make no bones about it—you can't beat the market (or even stomach it), and you don't want to waste your time trying. Tracking the major indexes with an ETF, then, may well be the way to go. Financial planner Levitt, for example, simply won't put a client with a lump sum to invest in a regular index fund anymore. Which one should you buy? It depends, naturally, on how much of the market you want to cover. The broadest, and most conservative, option is the Barclays iShares Russell 3000 (Ticker: IWV), which includes the largest 3,000 U.S. companies ranked by market cap—exposing you to 98% of the investable equity market. If you'd rather stick to the heavyweight Dow Jones Industrial Average, State Street offers Diamonds (DIA). Those wishing to track the S&P 500, though, have two fairly straightforward choices: Barclays iShares (IVV) and State Street's SPDRs (SPY). Barclays' large-cap offering is slightly cheaper, but Spiders have the big plus of having paid just one tiny capital gains distribution in seven years. (The iShares hit investors with a big one right after launching last year—not an auspicious move.) In terms of popularity, however, nothing comes close to the Bank of New York's Cubes, which track the Nasdaq 100 (QQQ) and are by far the most heavily traded ETFs. The benefit is that they let you invest quickly in virtually every blue-chip tech stock around. The problem is that you still have to figure out which way—up or down—to place your bets. "Right now," says Levitt, "we're shorting them."
Incidentally, you're likely to see big fund companies fighting back in the coming months by adding cheaper share classes to their own index funds. Vanguard, for instance, is currently working to launch its brand of ETF, called Vipers, by the end of March, and the company has already added a new "Admiral" share class, offering lower expense ratios for longtime investors with hefty accounts.
To balance your portfolio: Still tech-heavy? Haven't seen a small-cap stock in years? ETFs can be a quick way to get your portfolio back into shape. Cordaro likes Barclays iShares S&P 500/BARRA Growth (IVW) and Value shares (IVE), which segment the 500 companies into those two traditional investment categories. "We'll often buy the Value shares for clients who have a ton of tech stocks," says Cordaro. For exposure to smaller companies, Barclays has products that track the small- and mid-cap S&P indexes, and State Street offers StreetTrack baskets that follow the Dow Jones Small Cap Growth and Value indexes (DSG, DSV). But as we cautioned above, don't expect the same degree of tax efficiency in this category, because of the underlying churn of fast-growing companies. Though ETFs are still better than most comparable index funds on this count, that doesn't solve the basic problem. Sure, you want each company to become a growth company, but if it does, it gets kicked out, and you'll wind up with incrementally higher taxes.
To get exposure to a fast-moving corner of the market: ETFs can also be a shot in the arm—something to buy if you want specific, concentrated exposure to a country or sector on which you feel particularly bullish. iShare varieties come in a range of flavors, from health care to real estate, and you can even buy ones that track 21 of the most popular Morgan Stanley Capital Index countries. Levitt recently bought iShares Japan (EWJ) for a client who was convinced that that country would perk up but didn't want to bet on individual companies. Overall, however, financial advisors tend to be less enthusiastic about these types of ETFs, simply because the whole point of index investing is to avoid picking stocks or sectors. "We usually don't like to get that specific," says Cordaro.
That's also why the experts we spoke to weren't too hot on HOLDRS, another type of ETF marketed by Merrill Lynch. The company took popular sectors like broadband and wireless (yes, this was 1999) and put together portfolios of 20 stocks for each. But the portfolios don't have discretionary managers at the helm, and the stocks never change. So if a stock grows or slides too fast, there's no one there to manage a reallocation. Second, HOLDRS come only in blocks of 100 shares, making them too expensive for many investors.
But perhaps the biggest buzz these days is about Barclays EAFE basket, which is expected to launch this fall and will track Morgan Stanley's Europe, Australasia, and the Far East index. "It's going to be the first way to get broad international exposure in one place," Levitt says. In other words, U.S.-based international funds are about to get a run for their money too. |
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