By Quentin Fottrell
On a morning when markets seemed destined for tumult yet again, Pay Dirt called eight of the biggest brokerages to see whether they could assuage our concerns. We clocked their response time, asked them a series of questions, including “why is the market falling so quickly?” and “should I go to cash?” Then we checked out their web sites for additional help. Here’s how they stacked up:
1 E-Trade Response time: 10 seconds. The E-Trade rep said he would prefer to give advice based on an individual’s account, considering that investor style differs. “It’s better for everybody if the market goes up certainly,” he said. “I like to remain bullish at all times.” For investors who aren’t logged in, the E-Trade home page appears to be more of a window display for their accounts and products than a place to get information. However, there are real-time stock charts and news feed from several third-party sources, free webcasts and an online portfolio advisor. Spokeswoman Susan Hickey said customer service typically works with prospective clients “to help assess his/her current financial situation and define goals to establish a plan.”
2 TradeKing Response time: 16 seconds. TradeKing wouldn’t give any specific advice, but said, “We do have an online community where users can share opinions and information.” They include traders, bloggers and investors. It also has an online “education center” with market commentary, videos and web seminars. TradeKing spokeswoman Sue Parente said the average hold time is 15 seconds. “TradeKing does not provide investment advice,” she said, “however it does provide an education center to learn about investing.”
3 Vanguard Response time: 25 seconds. The customer service rep told us that investment decisions depend on a person’s risk tolerance and highlighted the need for a diversified portfolio. “Individual bonds or bond mutual funds tend are less volatile,” he said. For un-logged in visitors, the site also offers some commentary on current market events and news (currently: What a potential Greek default means to you and how labor costs in emerging markets will have a modest impact on U.S. consumer prices.) Spokesman John S. Woerth said the pick-up time is “modestly” shorter than 25 seconds.
4 Scottrade Response time: 28 seconds. The rep at Scottrade said the market is spooked by European debt worries and suggested “traditional investments like gold and defense companies” would be less risky. Then he recommended speaking to a registered investment advisor. The site offers market data on its home page and investing tips via its Knowledge Center, plus “news and commentary” to both account holders and non-account holders. Spokeswoman Carrie Hibbs said pick-up times rarely go beyond 30 seconds.
5 Fidelity Response time: 31 seconds. The Fidelity rep tried to talk us out of going into cash. “You’re going to miss out on the upswing,” he said. “At this point it’s a waiting game.” He blamed the Greek debt crisis and uncertain U.S. economy for the market volatility. For a more detailed picture, the Fidelity.com home page offers a real-time news feed and market data, along with broader personal finance stories (full disclosure: Some of those come from Dow Jones publications, including SmartMoney and the Wall Street Journal). The company did not respond to a request for comment.
6 Merrill Edge Response time: 35 seconds. Buy, the rep told us: “When there market is this volatile there are a lot of opportunities.” He said there were some defense stocks that could weather the storm, but declined to make any public recommendations. The site provides a daily market commentary and online chat services, and reports from Bank of America/Merrill Lynch Global Research 800 analysts for clients who are logged on and frequently asked questions on the European debt crisis. Spokesman Donald Vecchiarello says a 35-second pick-up time is typical for the company.
7 TD Ameritrade Response time: 40 seconds, plus a follow-up phone call and email. Unlike other firms that pinned the blame on overseas woes, the TD Ameritrade rep placed the market slide firmly on this side of the Atlantic. “The main reason is the general economic uncertainty with the lack of jobs being created,” he said. “Some businesses are making money, but many are questioning whether this is sustainable because of the lack of jobs.” Like most sites, it has online chat service for clients and news from MarketWatch.com and reprints of articles from Barron’s, both of which are part of the WSJ.com Digital Network. Spokeswoman Christina Goethe said 40 seconds is longer than usual and said the average pick-up time Monday was 6 seconds.
8 Charles Schwab Response time: 1 minute. The rep said brokers are no oracles: “Unfortunately, we don’t ever really know what’s going to happen in the market.” But he warned against moving into cash: “Definitely going to cash is reacting on emotion.” Spokesman Michael Cianfrocca says the usual pick-up time is around 20 seconds. “These answers are a good representation of what we are telling people,” he said, “focusing on diversification and having a long term plan.” The site has a daily market update under its “Research and Ideas” tab on the home page and an extensive “advice and retirement” section.
Pay Dirt readers, how does this tally with your experiences?