Online Brokers Absorb Flood
The Age
Tuesday April 18, 2000
Online stockbroking firms had their resources stretched to breaking point yesterday as investors flocked to financial websites to check plummeting share prices and place orders.
But early indications are that most of Australia's leading Internet and discount brokers handled the surge in demand without any big glitches or breakdowns, and with only a few complaints from users about waiting times for phone orders.
Australia's most popular online firm, Commonwealth Securities, recorded a 60per cent increase in trading volumes compared with a normal Monday's session, while E*Trade said its volumes were only slightly higher than usual.
Online brokers had used the weekend to prepare for a rush of orders from investors yesterday, with many firms boosting Internet bandwidth and employing extra staff to take phone trades.
ComSec chief marketing manager Stephen Mildred said it had ``borrowed" extra mainframe capacity from its parent company Commonwealth Bank, increasing the handling capacity of its website.
``This was a deliberate action to help us cope with the trades, while we also dropped our watchlist service so that our customers could more quickly check the prices of individual stocks."
E*Trade chief Kerry Roxburgh said it handled 6500 Internet trades, with its site flooded by investors within the first 30 minutes of the ASX opening. ``After about 11am, the traffic started to slow down a bit as clients checked stock prices and changed orders, and we were also helped by throwing extra bandwidth at our site at 11.30am."
He added that E*Trade telephone operators had their lunch cancelled, as staff were offered meals at their desks.
``We arranged extra staff over the weekend and are now prepared for the worst if Wall Street suffers again."
Sanford Securities general manager Duncan Stone said many users placed orders over the weekend, with much of the early volumes yesterday triggered by people amending their positions.
It is estimated that online brokers accounted for nearly 30 per cent of all trades yesterday, led by ComSec, which handled more than $100 million worth of orders.
© 2000 The Age