CyberCorp, Online Broker, Says 4th-Qtr Trades Up 54%
Austin, Texas, Jan. 10 (Bloomberg) -- CyberCorp, an Internet
brokerage serving frequent traders, said transactions rose 54
percent in the fourth quarter to 14,213 daily, likely keeping the
18-month-old company in the industry's top 10.
Austin, Texas-based CyberCorp, which began taking stock
trades over the Web in mid-1998, said assets rose 80 percent to
$202.3 million during the quarter from $112.4 million, while
accounts rose 850 to 2,500.
Those figures pale in comparison to rivals like No. 2
Internet broker E*Trade Group Inc., which has 1.55 million
accounts and assets of $28 billion.
Still, CyberCorp clients made an average of about seven
trades a day in the fourth quarter, more than the average E*Trade
client makes in six months, while CyberCorp's assets per account
of $80,000 are quadruple E*Trade's average.
``We're not in the business of opening $2,000 and $5,000
accounts,' Philip R. Berber, CyberCorp chairman, said. ``We
target active traders and do suitability screening,' resulting
in average new account sizes of $25,000 to $50,000, more than the
firm's $10,000 minimum.
Online brokerage trades surged 45 percent to 50 percent in
the fourth quarter as shares of the Internet companies favored by
their clients surged, analysts said. In late December, Charles
Schwab Corp., the biggest Internet brokerage, said trades were
running at a record monthly pace of 236,000, translating into a
growth rate of about 44 percent in the quarter.
Schwab, E*Trade and other large brokerages will formally
report fourth quarter results in the next week.
In the third quarter, CyberCorp was, for the first time,
ranked in the top 10, based on client trades, in two widely
watched industry surveys. The company was ranked ninth by U.S.
Bancorp Piper Jaffray and tenth by Hambrecht & Quist Group.
Aiming to capitalize on that status, CyberCorp has hired
Morgan Stanley Dean Witter & Co. to seek a buyer or merger
partner, though Berber said there was ``nothing material' to
report.
Berber said he hopes his company, formed in 1995, can
overtake FleetBoston Financial Corp.'s Suretrade and Morgan
Stanley's online brokerage business and move into the eighth spot
in both the H&Q and Piper Jaffray rankings for the latest
quarter.
The company, which airs its first national television
advertisement this week, will introduce options trading by the
end of the month, said Berber.
CyberCorp will earn $4 million to $5 million this year,
Berger has said, as revenue almost quadruples to $20 million from
$5.5 million in 1998.
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