"If people really knew what went on inside the brokerage firms, everybody would trade on-line."
Yes, but then again, there is plenty of downside to this as well.
In my career, I met many, many full service brokers who made their clients money, year in, year out. The problem is that the clients are very greedy. When they saw this market take off, they began to think that they could outperform their broker, and they did, because they cast caution to the wind, dispensing of risk and money management.
When they got to the online brokers, they found out about selling order flow to market makers; they found out what a market order will get them, too. Without the guidance of a seasoned investment professional, many of them began to look all over the Internet, falling victim to message board gossip, chat room charlatans, and ended up holding the bag on pump and dump schemes. Most of all, they also found out the they didn't know much about trading...
So all in all, it's a circle, and the bottom line is that people who are greedy will find themselves exploited by everyone in the industry, because they want to believe that the money is easy.
Teresa |
