According to a report on the online investment market, 16.28 million investors, more than three times the number of current online investors, are poised to begin online trading.
The report “The State of Online Investing” by Gomez Advisors and Harris Interactive found that once these investors go online, the value of the assets held in online investment accounts will increase to more than $1.1 trillion.
According to the report, the average online investor has 2.2 online trading accounts and an average of $35,000 in assets invested in them.
The survey tracked the attitudes and activities of online investors into three distinct pools; with indicators suggesting that they are waiting for the right offering to begin trading online. The three groups are:
- 2.85 million investors with offline brokerage accounts, who indicate that they are “likely” or “extremely likely” to open an online brokerage account in the next six months
- 660,000 offline investors with no brokerage account (mutual funds, etc.) who indicate that they are “likely” or “extremely likely” to open an online brokerage account in the next six months
- 12.77 million offline investors at the frontier of online investing, who are defined as those who demonstrate behavioral and demographic patterns similar to investors who currently trade online (e.g., research investing online, purchasing patterns, income, education).
According to the online survey of 20,119 adults, Gomez Advisors and Harris Interactive estimate that 5.1 million online investors have traded at least once during the past six months.
“Our analysis shows online investing has the opportunity to explode with a pool of investors waiting in the wings that is almost four times the current number,” said Alex Stein of Gomez Advisors. “The spoils will go to those brokers who really listen to the customer and answer their wants and needs. It’s clear those customers haven’t heard what they want to hear from the online brokers yet.”
The potential online investors who are looking to enter the market are “life-goal planners” who are seeking a more interactive experience with their broker and desire online advice with higher service levels.