Online Brokers Suffer Service Failures as Markets Surge

Apparent lack of capacity for trading surges strikes again

As markets surged on positive vaccine news and election sentiment, online investors and traders worldwide were foiled, yet again, by an inability to place trades on many major platforms. In the UK, traders reported problems with AJ Bell, Hargreaves Lansdown, and Fidelity UK, while US customers of Charles Schwab, TD Ameritrade, Merrill Edge, and Fidelity suffered slowdowns.

KEY TAKEAWAYS

• Markets opened to huge surges in trading the morning of November 9
• Some exchanges had issues dealing with massive increases of data requests
• Online brokers in Europe and the U.S. suffered outages

Outages and slowdowns during trading surges are an unfortunate, but common, issue faced by customers of online trading platforms. The main reason these outages continue to plague the industry is that most brokers do not have the capacity to have more than a small number of their clients logged in simultaneously.

Another issue is data flows from the exchanges themselves, which can also lag when the number of requests blows up. Tom Sosnoff of tastyworks tells us, "There were some exchange issues this morning with messaging in the first few minutes that affected everyone," though he says that his firm's platform experienced no problems otherwise.

For those affected, it's a good idea to clear your internet browser's cache and cookies before trying to log on again.

International problems

Traders in Europe flocked to Twitter to complain that they couldn't trade as the FTSE 100, a key index in the United Kingdom, popped 4.68%. Clients of AJ Bell YouInvest, Hargreaves Lansdown, and the UK branch of Fidelity aired their frustration on Twitter. An AJ Bell social media manager was busy responding to complaints with the message, "Hi, I'm very sorry for the inconvenience. Our team is aware of this particular issue and are working hard to fix it. Thanks."

Hargreaves Lansdown posted a notice on its home page that read, "We're experiencing intermittent service problems at the moment. We hope to have these resolved as quickly as possible. Please accept our apologies for any inconvenience caused in the meantime." Fidelity UK also apologized on their home page, stating, "Some customers are experiencing intermittent problems logging in to the system at the moment. We hope to have these resolved as quickly as possible. Sorry for any inconvenience."

Issues for U.S. traders

As U.S. residents awoke to the news of a potential Pfizer vaccine, many found that their brokerage accounts were inaccessible or processing trades so slowly that they felt they had lost out on potential gains. The period when trades were most affected was in the first 90 minutes after the markets opened.

Among the affected brokers based on reports posted to DownDetector were Charles Schwab, TD Ameritrade, Merrill Edge, and Fidelity. Interactive Brokers said that some clients experienced a slowdown as well. Their clients spoke out on social media.

Schwab, Fidelity and Merrill Edge respond

A spokesperson for Charles Schwab repeated, via email, the contents of their Twitter response, "Some Schwab applications experienced technical issues early this morning which have now been resolved. We are now working to address client questions as quickly as possible. We apologize for any inconvenience this may be causing our clients." A Fidelity spokesperson assures us, "Customers are able to access our online systems. Some may have experienced slower processing speeds for a short period at market open due to extremely high volumes, but trades were processed," though many customers on Twitter say they were unable to log in at all.

Though Merrill Edge clients said that they couldn't log in and that trades were being rejected, a spokesperson from parent Bank of America says, " Like all financial firms this morning, we have been experiencing higher than normal trading volume. We currently are not experiencing any issues."

At Vanguard, a spokesperson says, "We understand that some Vanguard clients may have experienced difficulty accessing their accounts on our systems. The issue has been resolved and we encourage clients to clear their internet cache and cookies, and recycle their web browser, before logging back on."

TD Ameritrade, Interactive Brokers, and Robinhood speak up

TD Ameritrade's response was helpful, admitting that, "Due to unprecedented volumes of activity, we encountered login issues across multiple TD Ameritrade platforms," specifically the TD Ameritrade Mobile app and thinkorswim web platform. Other TD Ameritrade platforms suffered significant slowdowns. While the issues were ongoing, a TD Ameritrade spokesperson said, "For the best experience, we recommend clients use the TD Ameritrade web platform, the thinkorswim mobile app, or the thinkorswim desktop app to access their accounts and execute trades. We apologize for the inconvenience and take the performance and reliability of our trading platforms very seriously." As of 1:35PM ET, the issue has been resolved and clients are able to access all TD Ameritrade platforms as usual.

An Interactive Brokers spokesperson notes, "We are not aware of any outages. However, there has been some slowness on some, but not all, of our platforms which we are addressing. We recommend clients use our professional-grade Trader Workstation during this period."

At Robinhood, a spokesperson says, "This morning, despite historic traffic, Robinhood systems remained operational. Our engineering teams have worked diligently to harden our infrastructure, improve reliability, and increase capacity." There were some issues reported to DownDetector, but they were less significant than past outages for Robinhood. This is a big step forward for the firm.

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Source - https://www.investopedia.com/online-brokers-suffer-service-failures-as-markets-surge-on-election-and-vaccine-news-5086672