Etrade first with real time fund trading

Etrade are offering a new service that allows Etrade members to invest in managed funds without the usual delays. The service, which uses straight through processing technology developed for share trading, allows investors to settle purchases and sales within three days as opposed to the usual week or two.

There are research tools and fund analysis available on 170 funds from which investors can make a selection and complete the transaction in real time. There are no entry or exit fees and wholesale funds attract a lower ongoing management fee.

While other online brokers allow access to managed funds, often rebating entry and exit fees, the application process requires a prospectus to be printed, signed and mailed to a fund manager. Etrade is able to offer this service by having agreements in place with fund managers that replace the requirement to have signed prospectuses for each investment made. Prospectuses are, however, available online in PDF file format for each fund.

Other online brokers offering managed funds include Comsec, TD Waterhouse, Macquarie Directrade, Quicken, HSBC Investdirect and St George Quicktrade.