E*Trade is an American company that offers online stock brokerage services. It was founded in 1991 and offers a range of investment tools, including stocks, bonds, mutual funds, and stock options. The company attempted to buy out or merge with other discount brokers, but was unsuccessful. E*Trade offers access to online training resources and expert opinions, and caters to the needs of private investors. It offers both full-service and discount brokerage services.
AE*Trade is an American company specializing in stock brokerage services via the Internet. Using this company, individuals can purchase securities without using a financial broker. A financial broker acts as an intermediary, receiving funds from individuals and managing the investment portfolio for them. Stock brokerages sell stocks, bonds, mutual funds and stock options. All of these items are investment tools, used as a long-term method of increasing wealth.
William A. Porter formed E*Trade in 1991 under the name E-Trade Securities Inc. This company provided trading services using CompuServe and America Online as service providers. E-Trade Securities Inc was at the forefront of a growing demand for direct access to financial markets. The introduction of the Internet and the widespread availability of powerful computers made this transition possible.
In the mid-1990s, the company was renamed the E-Trade Group and became a publicly traded company. They joined a number of other companies offering a combination of technology and service to investors. This combination of factors allowed the initial opening price of the shares to be very high, boosting the company’s profile and revenues. After many years in the business, expanding its product offering and renaming the company, E*Trade attempted to buy out or merge with other discount brokers. This included an unsuccessful attempt to buy TD Waterhouse and Ameritrade. In 2004, E*Trade secured Harrisdirect and BrownCo.
The subprime crisis in 2007 was the driving force behind a deal with Citadel Investment Group, to buy all subprime assets held by E*Trade for $800 million. As a result of this deal, the company recorded an asset loss of $3.8 billion (USD), Citadel gained a seat on the board of directors, and the CEO of E*Trade resigned.
The products offered by E*Trade remain focused on meeting the needs of the private investor. The company offers access to online training resources, expert opinions from a wide variety of sources, and the ability for working people to manage their own retirement savings. It is important to note that all discount broker services clearly state that there is a risk of loss with any investment activity.
There are two types of broker services: full service and discount. A full-service company provides a broker, who is responsible for interacting with the client and managing his portfolio. Clients’ investments are pooled into a larger pot and professionally managed. Fees charged reflect a certain level of professional service. In a discount company, the fees are much lower as there is no broker and each individual is responsible for their own transactions.
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