eTrade 1999 Annual Report Download - page 5

and services to serve all types of investors, from active investors to those who invest with a long-term, buy and hold strategy.
Market Data and Financial Information
E*TRADE continuously receives a direct feed of detailed quote data, market information and news. Customers can create their own
personal lists of stocks and options for quick access to current pricing information. E*TRADE provides its customers and members
free real-time quotes, including stocks, options, major market indices, most active issues, and largest gainers and losers for the major
exchanges. Users are alerted when a stock hits the price, volume or P/E ratio that they set. Through its alliances, the Company also
provides access to breaking news, charts, market commentary and analysis and company financial information.
Portfolio Tracking and Records Management
Customers have online access to a listing of all their portfolio assets held at E*TRADE, including data on the date of purchase, cost
basis, current price and current market value. The system automatically calculates unrealized profits and losses for each asset held.
Detailed account balance and transaction information includes cash and money fund balances, buying power, net market portfolio
value, dividends received, interest earned, deposits and withdrawals. Brokerage history includes all orders, executions, changes and
cancellations. Tax records include total short-term or long-term gain/loss and commissions paid. Customers can also create "shadow"
portfolios to include most financial instruments a customer is interested in tracking--for example, assets held at another brokerage firm.
These shadow portfolios can include stocks, options, bonds and many mutual funds.
Cash Management Services
Customer payments are received through the mail, federal wire system or the Internet, and are credited to customer accounts upon
receipt. The Company also provides other cash management services to its customers. For example, uninvested funds earn interest in a
credit interest program or can be invested in one of nine money market funds. In addition, the Company provides free checking
services with no minimum balance requirement through a commercial bank and is exploring the expansion of these services. The
Company, through its strategic relationship with National Processing Company, has expanded its cash management offerings to
include electronic funds transfer via the Internet and an automatic deposit program to allow scheduled periodic transfers of funds into
customers' E*TRADE accounts.
Account Security
The Company uses a combination of proprietary and industry standard security measures to protect customers' accounts. Customers
are assigned unique account numbers, user identifications and trading passwords
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that must be used each time they log on to the system. The Company relies on encryption and authentication technology, including
public key cryptography technology licensed from RSA Data Security, Inc. ("RSA"), to provide the security and authentication
necessary to effect the secure exchange of information. In addition, the Company uses Secure Socket Layers technology for data
encryption. Touch-tone telephone transactions are secured through a personal identification number ("PIN"), the same technology used
in ATMs. A second level of password protection is used prior to order placement. The Company also has an agreement to provide
digital certification and authentication services for electronic commerce through its alliance with VeriSign, Inc.
E*TRADE has also earned the CPA WebTrust seal of assurance and TRUSTe privacy program certification. The CPA WebTrust seal
of assurance shows that E*TRADE has passed an independent CPA audit of its Internet commerce business systems and provides
assurance that E*TRADE is a legitimate business, that customer transactions are safe and secure, and that customer privacy is
protected. TRUSTe is an independent, non-profit entity whose mission is to build users' trust and confidence in the Internet by
promoting the principles of disclosure and informed consent. E*TRADE is the first online investing service to earn the CPA WebTrust
seal of assurance and TRUSTe privacy program certification.
Access and Delivery of Services
The Company's services are widely accessible through multiple gateways, with automated order placement available 24 hours a day,
seven days a week by personal computer and by touch-tone telephone. In August 1999, the Company further enhanced its ability to
offer a superior customer experience by introducing access to live agent customer service on a 24x7x366 basis.
. Personal Computer. Customers using personal computers can access the E*TRADE system through the Internet, online service
providers (America Online, CompuServe, and Microsoft Network), or direct modem access. The Company's Web site combines an
easy-to-use graphical user interface with the trading capabilities that experienced investors demand. The Web-based system also
2002. EDGAR Online, Inc.