Online Trading: Part II

Abstract

The history of online trading began in the 1960s with the emergence of electronic communication networks, which allowed the electronic execution of trades outside traditional exchanges. The internet revolution led to the development of online brokerage platforms such as E*Trade and Schwab, enabling non-institutional investors to participate in the digital trading revolution. These platforms have evolved to serve the retail investor market, eventually adapting to mobile-first and commission-free models, significantly lowering the barriers to entry for financial markets. Platforms like Robinhood and other fintech firms have rapidly gained market share by offering services and products previously unavailable, such as commission-free trades, mobile trading, and novel products such as fractional shares and cryptocurrency investing. This chapter provides an overview of the history of online trading. It also introduces several new developments in fintech and the online trading industry and discusses various controversies and future implications of new technologies.

Citation

Martinez, A., Proulx, K. and Spieler, A.C. (2024), "Online Trading: Part II", Baker, H.K., Filbeck, G. and Black, K. (Ed.) The Emerald Handbook of Fintech, Emerald Publishing Limited, Leeds, pp. 221-234. https://doi.org/10.1108/978-1-83753-608-520241026