Brokers Expand Active Share Trading Investment Options
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The US broker Charles Schwab Corp is planning to buy equity options and futures trading company OptionsXpress Holdings in a $1 billion stock deal, designed to increase the brokerage's market share among active share trading clients. This move comes at a time when derivatives volume and profits remain strong relative to stocks.
Schwab has been known traditionally as a brokerage for longer-term investors, but CFO Joseph Matinetto said on a conference call that customers who trade options are their most economically valuable clients, as they average six times the trading activity of others. Executives predict that the company's average daily trade metrics will increase dramatically as a result of the acquisition, as the US options market continues to see strong growth. Retail trading in February options hit the highest level since October 2008.