The stock market’s violent gyrations earlier this summer brought Meg Page to her knees. But she wasn’t praying.
The Belvedere, Calif., marketing consultant was down on all fours hunting for telephone jacks so she could hook up her portable computer and see what was happening to her portfolio. “I work at different companies each day, so I was crawling around under a lot of desks, unplugging fax machines,” she explains.
Page is one of several million investors who turn to a growing number of on-line services for the latest stock-price quotes and market indexes.
Stock quotes have been a staple of the personal-investing information provided on such commercial services as America Online, CompuServe and Prodigy. Now they are also popping up on dozens of Internet sites, including those sponsored by brokerage firms such as Charles Schwab Corp. (http://www.schwab.com), the chat group run by Silicon Investors Inc. (http://www.techstocks.com) and services offered by news organizations such as Dow Jones & Co.’s The Wall Street Journal Interactive Edition (http://wsj.com).
Individual investors have been logging on to on-line quotation services like never before. But alas, in cyberspace, crowds aren’t a plus. They often create long delays and sometimes serious system problems. And the glitches aren’t always apparent, as some America Online subscribers discovered recently.
Imagine logging on only to discover that the Nasdaq composite index plummeted by 9 percent in a matter of a few hours. The panic you feel is much like the frenzy some America Online subscribers suffered last month when a computer problem caused the popular service to report bogus price-change data for market indexes and individual securities. The bad information was provided to subscribers for almost the entire trading day on July 16. Some subscribers say they didn’t know there was a problem with the information until they read the newspapers the following day.
Bob Cullinan, a San Rafael, Calif., subscriber was shocked when his screen reported that Premisys Communications Inc. lost $12.625, and Cabletron Systems Inc. was down $8. “I thought to myself, `This is the biggest bloodbath I have ever seen. I am getting killed here and there is nothing I can do.’ ” In reality, Premisys was down no more than $7.50 that fateful day, while Cabletron was down no more than $4.75 at any time during the day.
If you are serious about tracking the market on-line, it pays to be aware of several key differences among the services. Here’s a savvy investor’s guide to stock quotes on the information superhighway:
– Mind the time. Organizations like CheckFree Corp.’s Security APL Inc. (http://www.secapl.com) were pioneers in offering free stock quotes on the Internet back in 1994. Until then, electronic stock quotes were available almost exclusively to professional investors who were willing to pay stiff fees and shell out big bucks for expensive computer terminals.
But while the new services have helped level the playing field for the average small investor, there is a catch. Although information on most market indexes is current, the free on-line quotes for individual securities are almost all delayed by 20 minutes, according to rules created by the stock exchanges. (The delay is often referred to as a 15-minute delay, because that’s how long information providers used to have to hold the data after receiving it from the exchanges–a process that itself used to take about five minutes. Now that the providers get the information from the exchanges virtually instantaneously, they are being required to hold it for 20 minutes except in the case of customers who pay a small monthly fee.)
With some free stock-quote services, the timing isn’t clear. For example, Quote.com Inc.’s service (http://www.quote.com) displays a time next to a stock’s price, but users have to subtract 20 minutes to figure out when the quote was actually current. Chris Cooper, the company’s president, says the time displayed on the screen is the time a quote was pulled from the service’s “quote plant.”
– Consider new options. Most long-term investors would do just fine with 20-minute-delayed quotes, since they shouldn’t attempt to time the market anyway. But active investors should consider buying real-time quotes so they can keep up with markets that are zooming around at a breakneck speed. It’s not unusual for stocks to leap by as many as 8 to 10 points within a mere five minutes.
Until this year, investors would have had to shell out about $200 a month for real-time quotes. But some big-name wholesale stock quote providers have cut their prices recently, and have started taking in advertising revenue. Two examples: PC Quote Inc. (http://www.pcquote.com) and Data Broadcasting Corp. (http://www.dbc.com), both of which charge about $30 a month. Quote.com is expected to announce a similar real-time service at a slightly lower price this month.
If you place trades on-line with one of the many discount brokerage firms now taking orders from investors with computers, you will generally receive a certain number of free real-time quotes for each trade you place. For example, for each trade Schwab customers get credit toward 100 free real-time quotes, or 50 quotes if they use the e.Schwab no-frills service.
– Go wireless. People with pagers that can display messages now can get real-time stock quotes sent to them at any time. The computer on-line service CompuServe began offering a free service that enables subscribers with beepers to receive three messages a day showing the real-time prices of any five stocks.
Of course, it could take anywhere from a minute to a full five minutes for you to get the message, depending on the speed of your pager service. But subscribers could arrange for CompuServe to page them at, say, 11 a.m., 2 p.m. and 4 p.m., showing prices for five stocks of their choice.
But CompuServe doesn’t have a corner on this market. Intelligent Information Inc., of Stamford, Conn., is working with several paging companies to offer a similar service.
