Capital Alliance Group - CPT (CDNX) Message Board

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Gold/Mining/Energy : Capital Alliance Group - CPT (CDNX)

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To: keith massey who wrote (13)	3/13/2000 3:34:00 PM
From: keith massey	Read Replies (2) of 960

It is not surprising to see other companies trying to grab a piece of this huge, relatively untapped market. I have done some research and already understand that Etrade and Paribas E-Cortal have expanded into Europe and that TD Waterhouse is presently attempting to expand into the Asian and India markets. I guess we can now add Charles Schwab to that list. Presently SEG has no direct competitor in that no other company is functioning as a portal business with stockbrokers. Emerging countries are very restrictive to foreign trade competition; therefore, there is no incentive for local brokers to partner up with newcomers in the same industry. A similar structure has been attempted with broker networks and referral programs but none have worked because each broker was afraid of having their clientele stolen away from them. Because SEG is partnering up and have non-competition agreements in the brokerage business, brokers welcome them with opens arms. TD Waterhouse, ETrade and now Schwab are trying to expand to foreign countries by attempting to partner with local brokers in joint ventures. However, since these joint ventures are still functioning as brokerages, they are limited to their respective markets. There are miles of red tape to do a single joint venture in a single country and it will be a very time consuming and costly venture for these groups to expand all the various countries that SEG is has already targeted. The beautiful thing about SEG?s business plan is that they are not doing a joint venture but instead are becoming a portal for the trade which means they can by-pass the miles of red tape and be the first to market. In addition, SEG is presently building strategic relationships and executing binding memorandum of understanding with leading brokers throughout in the Asian market place, which will also provide them with a competitive edge. Not only with SEG?s clients have access to the partners brokers trading facility, but they will also have access to the various trading and research reports offered by the various firms. Since these firms are already the leading brokers in their respective country these reports will be a valuable asset that likely cannot be provided right away by the competition. You may have noticed in the Charles Schwab news release that they will not have the basic facility operational until the fourth quarter of 2000 and then will roll out different countries in stages. You can expect similar delays with the other groups as they attempt to cut through the red tape. A little competition is good but in this case I think SEG has a competitive advantage and has the chance to become one of the major players in the foreign market service game. Best Regards KEITH

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