It is believed that the retail online options industry is poised for continued, rapid growth. Approximately 15 million households have online brokerage accounts (13% of all U.S. households), although nearly 70% of such households execute fewer than five trades per year. The number of households with online brokerage accounts is forecasted to increase by 11.9% per year to approximately 26 million by 2008 (22% of all U.S. households). The total U.S. listed options market has grown by 22.5% per year over the past 10 years. Despite this growth, it is estimated that only 9% of online accounts are authorized to trade options.

It is believed that the retail online options trading market will continue to benefit from the investors' increasing familiarity with options trading, the increasing liquidity and improved pricing in the market created by additional market participation and beneficial changes in market structure, including the emergence of fully electronic options exchanges in lieu of traditional floor exchanges.

The Company’s software was designed to ensure an efficient customer experience, beginning with a highly automated account opening process and ending with fast trade execution and thorough, real-time position monitoring.

The Company’s user-friendly interface provides interactive real-time views of account balances, positions, profits or losses and buying power to enable the customers to more easily make informed investment decisions. Customers are able to access all features from any web browser without downloading software.

The Company’s brokerage platform caters to both novice and expert investors. Novice investors are provided with, among other things, both educational and research material and comprehensive customer support all via a customer-friendly interface. Trading features more relevant to expert traders include data streaming, charting services and advanced order services.

Customers have unrestricted online access to a complete listing of all their account activity over the life of the account, including transaction data on the date of purchase, cost basis, current price, current market value and margin balances. Detailed account balance and transaction information includes money market balances, buying power, net market portfolio value, dividends, commissions paid, trade dates, settlement dates, deposits and withdrawals. Brokerage history includes a detailed status of all orders placed, including whether any order is pending or open or has been executed or canceled. There is no limit on how far back a customer is able to obtain data, nor is there a charge for the provision of this service.

The design of the Company’s technology allows customers to integrate the Company’s execution with third-party investment or analytical software, including e-Signal, Quotracker, Prophet, PowerOptions and Wizetrade. This is a key design feature of the Company’s platform and differentiates the Company from other online trading systems that rely on legacy technologies. Giving the customer access to other technologies allows the Company to service customers who use complementary analytical software. The design of the Company’s technology allows the Company to easily and cost-effectively private label its website for other financial institutions.

Brokerage, clearing, and other related expenses increased $4.6 million, or 79%, to $10.5 million for the nine months ended September 30, 2004 from $5.9 million for the nine months ended September 30, 2003.

Advertising expenses increased $3.2 million, or 177%, to $5.1 million for the nine months ended September 30, 2004 from $1.9 million for the nine months ended September 30, 2003.

Depreciation and amortization expenses increased $0.7 million, or 135%, to $1.2 million for the nine months ended September 30, 2004 from $0.5 million for the nine months ended September 30, 2003.

Income taxes increased $8.5 million, or 127%, to $15.2 million for the nine months ended September 30, 2004 from $6.7 million for the nine months ended September 30, 2003.