Markets tumble and computers crash.
When the market does fall, online brokerages should theoretically be equipped to handle four times as many trades as they currently process without a hiccup. But so far the hiccups won't go away. Because online brokerages have substantially upgraded their Internet and phone capacity, regulators may be more inclined to see investor behavior and misleading advertising by some online brokerages as the key issues. Earlier this year the Securities and Exchange Commission rebuked investors for trading online too quickly and too often. E-commerce analyst Bill Burnham of Credit Suisse First Boston predicts the SEC will require brokerages to post warnings to investors online that they aren't necessarily guaranteed access to the market at all times.