New York, June 07: Cut your losses and move on. That's the mantra adopted by most Wall Street firms that have dabbled in the online stock trading business.
With individual investors showing no sign of regaining their once voracious appetite for online stock trading, financial giants like Merrill Lynch & Co. and Morgan Stanley have decided to shed online units to cut costs and focus on more traditional forms of investment service.
The retreat amounts to a vote of no confidence for the online banking and stock trading sector, which has fallen from favor since the bull market ended in 2000.
"While we were riding the curve of a rising market, it was easy for all participants to say 'We would like a piece of this business,'" said Karen Vernamonti, chief financial officer of J.P. Morgan Chase's online brokerage arm, Brown & Co.
The move reflects a shift in strategy by some of the major players on Wall Street as they try to focus harder on profitable business lines while walking away from others.