I've been following the launch late last year of the first free stock trading site on the web -- www.zecco.com -- and have wanted to see how the company was doing pitching its "commission-free stock trades" to a public that's already swimming in low-cost trading companies like Scottrade, TD Ameritrade and Schwab.
With stock trading becoming a commodity business, the typical strategy of discount brokerages that have built an entire business on cheap trades is to now offer "financial guidance and investing services." Charles Schwab has done this as it saw the prices of stock trading plummet (thanks, Internet). With it went margins and employee commissions as well.
Some bloggers that have had bad experiences with Zecco.com are pretty adamant about the initial issues the company has regarding its communications and what it really ads to the equation besides making money on advertising on its website (how it can trade for 'free"?).
Will this business model stand the test of time? Or do most customers need that extra hand-holding they perceive to get by paying for trades?
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Reader Comments (Page 1 of 1)
2-25-2009 @ 11:52PM
john sloan said...
I researched Zecco as well and i put my money
it it to really check it out and decided it
was a bait and switch. It took over a month
before I could take my money out, so before
you decide to deposit money remember this
old saying (If It Sounds Too Good To Be True
-thats right) so I took a good advice and
signed up with scottrade.com and got 3 free
trades with this promo code: YWEU0574
1-31-2007 @ 9:15PM
allard luchsinger said...
Hi Brian, I'm the COO of Zecco and I'm happy to tell you that Zecco is doing very well. Free stock trading has proven to be a very attractive offer judging from the thousands and thousands of people who have flocked to Zecco since our October launch. Our customers tell us they truly appreciate our service and offering (0 dollar commissions, fast executions and full customer support). Yes, we had some start-up issues and of course we have work to do. But as you'll see on our forums the period of the start-up issues has passed. And we've just started. Over the coming months we'll introduce products and services that will show that Zecco is more than the next online broker with cheap trades. I'm looking forward to hear what others have to say about where we are today. Please keep an eye out because the future with Zecco will be very exciting.
12-22-2007 @ 4:19PM
Nick Jensen said...
I researched Zecco and decided it was a bait and switch. I signed up with scottrade.com and got 3 free trades with this promo code: DOOL8293