Online Finance -part 2-
The American online brokers should follow a business model more like that of Charles Schwab in the last quarter saw how only 43% of total sales came from stock trading commissions.
22% of its revenue came from the sale of mutual funds, investors often have much longer periods of time that the shares and are therefore less subject to cyclical swing of the bags.
Even we could venture further and say that Schwab’s model is too dependent on the volumes traded. Intuit, the U.S. company whose main source of income is the sale of financial accounting software and tax, but also has a valuable financial portal (Quicken.com) might be an example to follow.
In fiscal year 1999 ended on 31 July, Intuit generated approximately 35% of your earnings to nearly $ 850 million from the sale of products for small and medium enterprises.
These consist of financial software, but also fees for payment services providers and pay payroll via the Internet.
Moreover, the division of Intuit’s personal finance accounted for 16% of its total business. To a great extent, this division generated its revenue through the intermediation of financial products (mortgages, credit cards, bank deposits, insurance, securities transactions but not) among the sellers (banks, savings banks and insurance companies) and consumer final.
Patagon.com, a stockbroker from Argentina Latin America already has 15,000 accounts and has the support of funds from U.S. venture capital, has the ultimate objective to become a financial portal in Latin America investor to sell credit cards, mortgages, stock trading, insurance and other products financieros.Sus managers seem to intuit that the only way business will get enough volume to ensure profitability.
The online financial supermarket
Thus the concept of online broker expands to become a financial supermarket.
With compelling content (interesting articles, portfolio management software, tax advice, etc …) also increases the advertising value of the portals and with it the opportunity to capture a significant part of the emerging market for online advertising in Latin America.
E-commerce generated last year about $ 460 million in the region, according to estimates IDC, while advertising accounted for less than $ 40 million, both figures will grow to U.S. $ 8,000 million and over U.S. $ 100 million in 2003.
The current online brokerages, as embryonic financial supermarket, waiting to take an important part of the pie. A strategy based solely on generating income from securities commissions do not lead to the desired location.
credit to: Jorge E. Pereira
Source: www.gestiopolis.com/canales6/mkt/mercadeopuntocom/mercado-bursatil-en-internet.htm
image source: www.drishtieducation.com/_templates/car3/Online-Finance-Education.jpg
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