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1/25/2013 10:33:00 PM
Investors of a certain age recall a time when you checked your portfolio by picking up the morning newspaper and rummaging through the stock tables in the back of the business section to see how you did the day before.
If you wanted to figure your portfolio's value, you did the math yourself. Or you called your broker, who was glad to take your call since you were paying him $100 a trade.
The revolution in computers, the Internet, trading algorithms, market structure, broadband, smartphones and tablets have brought that day happily to an end. Not only are commissions at rock bottom compared with the bad old days, but also most active traders carry around streaming real-time quotes, charts and news in their pockets, unless they're in the middle of the ocean or on the summit of Mount Everest. Even then, they can access the market, although it might cost them a bit.
In Your Hands
The battle of the brokers today is fought fiercely on the iPhone, iPad and on Android devices. Thanks to the relentless march of technology, you can dump yourApple ( AAPL ) shares while waiting in line at the grocery store.
E-Trade ( ETFC ) boasts of being a pioneer in online and mobile trading. It introduced an application for the BlackBerry way back in June 2008.
E-Trade also claims to be the first with an iPad app, live CNBC feeds, push notifications and an Android widget. It appears to be the only broker that provides voice recognition to navigate the app, look up quotes and news or even enter a stock order. It uses the Nuance voice-recognition software that is said to power Apple's Siri.
"Many people want the ability to regularly check their accounts, track their performance and review the latest quotes and news," said E-Trade's Eric Johnson. "People also frequently use our bar-code scanning feature to identify a product's parent company and get information, such as a company's news and performance."
Charles Schwab ( SCHW ) has long offered its StreetSmart Edge desktop software that's gone through many refinements.
From that, it's developed a suite of apps for iPhone and iPad and Android devices. Like most of its competitors, Schwab offers a host of charting options.
A feature of Schwab's iPad app is a Quick Quote bar that allows trades to be entered from almost anywhere in the app.
Interactive Brokers ( IBKR ) is no beginner in the field of handheld trading. It claims to be the first to build a processor that could be carried around on trading floors in the 1980s. Yet the 35-year-old brokerage might not be the right choice for a novice.
"We're aimed more at the professional, semiprofessional or institutional investor," said Steven Sanders, who oversees product development and marketing for Interactive Brokers. "We're the largest electronic broker in terms of number of trades. If you're somebody that does their homework, does a lot of trades, wants the lowest price and the best execution, we're the right place for you. If you're somebody who makes an occasional trade and needs some hand-holding, then you're probably better off somewhere else."
Interactive goes way beyond tools for successful investing in stocks on a mobile device. It offers access to global markets, bonds, options, options chains, forex and futures with real-time news and sophisticated tools. Only 0.7% of Interactive's trades are made using an iPhone and only 0.3% using an iPad, Sanders says.
Sanders suspects many customers are set up at home or in an office, but need a mobile app for those occasions when they are out and about during market hours.
With 6 million account holders,TD Ameritrade ( AMTD ) has two tracks for desktop and mobile platforms.
Thinkorswim, another favorite in the Best Online Brokers survey, works on the desktop, be it a Windows machine or a Mac, and has equivalents on the smartphone and tablet. It's more sophisticated, has a learning curve and is aimed at the technically oriented trader.
A few years ago, TD Ameritrade bought Thinkorswim and made it part of its offerings.
Trade Architect, another TD Ameritrade platform, is simpler and is aimed at the fundamental investor, says Nicole Sherrod, the parent firm's managing director of trading. Mobile trading is trying to catch on at TD Ameritrade, where only 8% of daily trades are made through a handheld device.
"I was on maternity leave recently, and I used the iPad app, and I just loved it," Sherrod told IBD.
TD Ameritrade's trading platforms are continuously upgraded. Thinkorswim rolls out a new version each month. A cool feature is that watch lists saved on Thinkorswim sync with the iPad app.
Ready For Battle
USAA is a late entry in the mobile field. The general-purpose financial firm launched its iPhone and Android apps in mid-August and released its iPad app in mid-October.
USAA caters mainly to members of the military and their families. It was founded in 1922 for men in uniform, but its brokerage business is now open to all comers. As a result of that focus, it has fewer active traders than some other brokers.
Art Garcia, who oversees USAA's product development, says only 6% of self-service trades are made from a mobile device.
"It's low at this point, but it's picking up steam," he said. In fact, the company decided to upgrade its mobile apps before tackling its desktop experience.
Garcia concedes USAA has a lot of catching up to do in the mobile field. For his company, he says, mobile trading is more about accommodation of customers than about generating tons of trading volume.
The mobile apps integrate customers with other parts of USAA's business, like insurance and banking. Garcia says it's particularly easy to transfer money between brokerage and bank accounts.