Another benefit for funds is that they can collect more information about investors online, both by asking questions directly about investment goals and by keeping track electronically of how a consumer uses the site. Financial service providers have only begun to scratch the surface of potential Internet investment, Gazala said. A recent Forrester survey showed that only 13 percent of consumers who are online have used the Internet to buy stocks and bonds or mutual funds. The research company estimates that 4.5 million online investment accounts for mutual funds or stocks and bonds will grow to 5.3 million by the end of the year and to 14.4 million by 2002. Mutual fund industry analysts caution that, despite the advantages of using the Internet for fund investing, investors should be aware that problems could arise.
Some funds are cautious about moving onto the Internet.
It's a complicated matter. Many investors are cautious, too.