Execution-only share trades conducted by private investors increased by 13% in the first three mo...
Execution-only share trades conducted by private investors increased by 13% in the first three months of this year, despite the downturn in investor sentiment towards the stockmarkets, the latest ComPeer survey of private client activity suggests.
Published by Association of Private Client and Investment Management Services, the report says around 60,000 trades per day were transacted for private investors during Q1 2001, with the number of trades conducted over the internet also increasing by 13 per cent, according to the quarterly survey.
Key findings of the survey suggest the APCIMS/ComPeer quarterly index of private client activity rose from 244 in Q4 2000 to 276 in Q1 2001, even though markets were falling, and the number of online clients increased once again, from 287,000 in Q4 to 305,000 in Q1 2001.
Internet-based investors are now said to account for 29 per cent of all execution-only trades, according to the ComPeer report, as the number of online trades rose from 684,600 in the last quarter of 2000 to 776,600 in the first quarter of 2001.
Once again, use of the internet as a trading platform increased at a slower rate of 4% from £2.45bn to 2.54bn, reducing the level of increased trading for the second quarter running, according to APCIMS.
However, recent new entrants into the market - including internet-based trading houses such as E-trade - are still nibbling away at the business of established players, keeping the business highly competitive by offering investors good deals on trades.
Around 28 firms are now offering online trading services, with no indication that this number is likely to level off, says APCIMS.
APCIMS Chief Executive Angela Knight said:
"These figures show a return to steady trading after last year's dotcom frenzy. The first quarter is always the busiest of the year and these figures show a sustainable increase.
"The downside is that in this bear market investors are selling more than they are buying. Although there are buying opportunities out there, confidence has been shaken and we do not expect them to become net buyers again until the market has turned around and is steadily rising again."
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