Abstract
Despite the fact that the use of e-brokers has grown exponentially, the authors note that a number of investors still prefer using the services of traditional full-service and discount brokers. The article focuses on the preferences of and problems faced by investors in their selection and usage of brokers, using a survey conducted on a sample of Florida residents. Analyzing the results of the survey, the authors find no significant relationship between usage of either discount or full-service brokerages and investments in either stocks, bonds, or mutual funds. However, significant relationships are found between usage of Internet brokerages and investments in bonds as well as mutual funds. In addition, no relationship is found between access to the Internet and investments in various securities. Furthermore, no relationship is detected between various levels of income of the investors and investments in stocks. However, as income levels of investors decrease below certain levels, respondents are found to invest significantly less in bonds and mutual funds than the hypothesis of independence predicts. The authors conclude that full-service and discount brokers still occupy market niches, though on-line brokerages are in a growth stage.
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