Online investing in Western Europe is slowing down and will only increase by a compound annual growth rate of 10.5% from 2002 to 2007, according to forecasts from market intelligence firm IDC.
IDC says the slowdown indicates that the e-trading market is becoming mature, making it an especially challenging area for all the players involved.
After enthusiastic early years, the growth of European online trading accounts is heading toward a lower level of expansion in almost all European countries.
The IDC analysis focused on six countries - France, Germany, Italy, Spain, Sweden and the UK - and found that traditional brokers have caught up with pure online players, with at least 90% now having a Web site. However, by the end of 2002 the number of players that had reached profitability was still limited.
Constraints such as security concerns, capital market trends and low confidence are also restricting market growth, while reduced profits are limiting marketing initiatives to attract new customers.
IDC says new technologies and applications will have a restricted role in the evolution of e-investing, as the infrastructure and quality of current platforms are already very advanced and provide consumers with access to high-performance products.
Mirko Corbetta, research analyst in IDC's online financial services programme, says: "The Western European financial sector is undergoing changes that are aimed at better exploiting the customer base by adding more value to the existing services and prompting more cost-effective channels."