Online brokers welcome low volatility

“The smaller firms are not as driven by turnover as they are by asset level values,” says Portales Partners analyst Charles Peabody, trying to explain why low volatility - hitting hard the revenues of the trading departments of the big banks - is helpful to online players like Schwab (SCHW -0.7%), E*Trade (ETFC +0.1%), and Ameritrade (AMTD +0.4%).

"Volatility terrifies retail investors," says fund manager Chad Morganlander. It all adds up to earnings growth, with E*Trade's adjusted profit expected to grow 55% this year and Schwab's 24%. This compares to projected declines at the big banks.

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  • doughave
    , contributor
    Comments (84) | Send Message
    ETFC also has $7B in legacy mortgage loans that made it through the Great Recession.


    Anyone out there interested in doing an updated analysis of the loan portfolio?
    30 Jun 2014, 11:39 AM Reply Like
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