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Internet stock trading opened to savvy Slovaks

WHILE many in America are still licking their wounds from investment losses after the tech-bubble collapse, Slovak providers are expanding their offer of low-fee Internet stock trading.
Some services offer potential traders access to American and German stock markets, and will soon also offer the London and Swiss exchanges.
"We don't give details about our clients, but I can say that we count them in the hundreds," said Peter Paník from RM-S Market, which operates one of the larger sites - rmsfinport.sk.

WHILE many in America are still licking their wounds from investment losses after the tech-bubble collapse, Slovak providers are expanding their offer of low-fee Internet stock trading.

Some services offer potential traders access to American and German stock markets, and will soon also offer the London and Swiss exchanges.

"We don't give details about our clients, but I can say that we count them in the hundreds," said Peter Paník from RM-S Market, which operates one of the larger sites - rmsfinport.sk.

"If you have a computer and Internet at home, you can trade directly on American markets. In May or June we're planning to introduce the London, German and Swiss stock exchanges, so Europe will also be possible," said Paník.

Providers, licensed by the Financial Markets Office, say that security is not an issue and that transactions are safe. "We have a secure telecoms network; we use ciphering and encryption technology on our pages," said Paník, adding that security measures are similar to those used in Internet banking

Secure networks and secure investments, however, are different things. According to Mesa 10 think tank analyst Marek Jakoby: "Compared to more traditional dealings, this type can be connected with an increased degree of speculative risk.

"Right now there are different offers for trading through the Internet, for example on foreign exchange markets. In this sense they remind me of hazardous games.

"I think this kind of investing should be a more comfortable form of classic trading. But there should be legal protection so that there's not a higher degree of risk than in traditional methods," he said.

To get people used to the idea of stock trading, the RM-S has organised a free game where players can test their investment acumen against each other and private television station Markíza boss Pavol Rusko.

"The game works through Markíza, our advertising partner. When you open an account in the game, you have a fictional $10,000 and you can trade shares with it. You make money or you lose money," said Paník.

The game offers prizes to the best investors of the month, while best investors of the year can win a new Seat Ibiza.

Low-fee access to stock markets and generous stock-option packages led to a "day-trading" boom in the US in the late 1990s, where individuals would make large numbers of small, short-term trades over the Internet.

However, Jakoby doesn't see such the craze taking off here. "Slovakia still has a minimal portion of capital investment through the internet - my personal estimate is less than five per cent.

"In two or three years, it could reach 10 per cent maximum, but I don't see any prospective boom in this method of investment."

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