Abstract
Many online brokers offer investors the efficient execution of security trades. Each broker has a set of costs and a bundle of features from which traders make complicated comparisons to select a broker. A way to simplify broker choice is to examine the relationship between costs and features from online brokers. If online brokers operate in an efficient market, costs should vary directly with the size and quality of features offered. And if costs vary directly with features, then the costs are a signal for features in an efficient market for online brokers. This paper compares costs and features of online brokers and finds no relationship between them, which suggests that online traders need to find other ways to simplify their choice of an online broker.
Recommended Citation
Johnson, Raymond M. PhD; Newman, Christine M.; and Newman, Joseph A. PhD
(2018)
"Online Brokers: A Comparison of Costs and Features,"
Journal of Business, Industry, and Economics: Vol. 23, Article 3.
Available at:
https://roar.una.edu/jobie/vol23/iss1/3