An Exploratory Study in the Brazilian Market

The scope of this chapter is to investigate the critical factors for the success of stock brokerage processes via the Web, using financial portals on the Brazilian Internet, from the perspective of the investor. The framework of the online stock trading system is presented in order to compare the traditional form of stock brokerage with that made possible by the Internet and discuss some of the issues regarding intermediation and disintermediation that has occurred in the process. Conclusions are drawn based on a survey conducted with Brazilian investors who operate using Internet stockbrokers for the intermediation of their stock operations. The findings were analyzed from the perspective of the theoretical reference framework created and outlined here. Critical aspects for the success of stock brokerage over the Internet, from the investor’s standpoint, were assessed and presented, while areas for further research were also identified. IDEA GROUP PUBLISHING 701 E. Chocolate Avenue, Suite 200, Hershey PA 17033-1240, USA Tel: 717/533-8845; Fax 717/533-8661; URL-http://www.idea-group.com ITB11186 This chapter appears in the book, Electronic Business in Developing Countries: Opportunities and Challenges edited by Sherif Kamel. © 2005, Idea Group Inc. 194 De Campos Costa and Joia Copyright © 2006, Idea Group Inc. Copying or distributing in print or electronic forms without written permission of Idea Group Inc. is prohibited. Introduction The objective of this chapter is to develop an exploratory study where some of the Critical Success Factors (CSF) for stock brokerage over the Internet in the Brazilian market will be singled out. The findings described are based on a survey that was conducted with a group of investors who use Brazilian financial portals for trading stocks and are analyzed from the perspective of these investors, i.e., based on their perception of what they consider the critical factors for the success of the stock trading process over the Web. After this introduction, the background for this work is presented by developing a contextual assessment of the situation where relevant factors in the Brazilian and worldwide stock markets in the context of this study are discussed. This is followed by the elaboration of a theoretical framework where the differences between traditional and online stock trading are defined and where intermediation and disintermediation concepts are discussed. The methodology used in the research is briefly discussed and the findings of the survey are presented. Finally, possible future trends in this area are listed , followed by the conclusions drawn from this study.