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Online Trading

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Abstract

The proliferation of the Internet has led to the rapid growth of online brokerage. As the Internet now allows individual investors access to information previously available only to institutional investors, individual investors are profiting in the financial markets through online trading schemes. Rock-bottom fees charged by the online brokers and the changing attitude toward risk of the Internet-literate generation prompt the practitioners to question the validity of the traditional valuation models and statistics-based portfolio formulation strategies. These tactics also induce more dramatic changes in the financial markets. Online trading, however, does involve a high degree of risk, and can cause a profitable portfolio to sour in a matter of minutes. This paper addresses the major challenges of trading stocks on the Internet, and recommends a decision support system for online traders to minimize the potential of risks.

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Author information

Authors and Affiliations

  1. University of Southern Mississippi, Hattiesburg, MS, USA

    Chang-Tseh Hsieh

Authors
  1. Chang-Tseh Hsieh
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Correspondence to Chang-Tseh Hsieh .

Editor information

Editors and Affiliations

  1. Dept. Finance, Rutgers University, Rockafeller Road 94, New Brunswick, 08854-8054, New Jersey, USA

    Cheng-Few Lee

  2. College of Business, San Francisco State University, Holloway Ave. 1600, San Fransisco, 94132, California, USA

    Alice C. Lee

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© 2013 Springer Science+Business Media New York

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Hsieh, CT. (2013). Online Trading. In: Lee, CF., Lee, A. (eds) Encyclopedia of Finance. Springer, Boston, MA. https://doi.org/10.1007/978-1-4614-5360-4_21

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  • DOI: https://doi.org/10.1007/978-1-4614-5360-4_21

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  • Publisher Name: Springer, Boston, MA

  • Print ISBN: 978-1-4614-5359-8

  • Online ISBN: 978-1-4614-5360-4

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