Online brokers avoid troubles amid internet outages
The internet outages occurred after servers from content-delivery network Fastly Inc. went down, affecting Amazon, Twitter, PayPal, Spotify, Twitch and CNN, among others.
Online brokerages were seemingly unaffected after major websites and apps around the world went dark Tuesday morning, including the New York Times, Bloomberg News, Reddit Inc., and the U.K. government.
The internet outages occurred after servers from content-delivery network Fastly Inc. went down. Amazon, Twitter, PayPal, Spotify, Twitch, CNN and Target were also affected this morning, according to DownDetector, an outage monitoring website. Tech site The Verge was also impacted and even used an open Google Doc to report on the story, but did not turn off editing.
More than 500 user reports indicated online trading platform Robinhood had outages around 11:53 p.m. ET Monday evening, but have since been resolved, according to DownDetector. However, those reports came before the global web outage swept across the internet. Robinhood did not respond to a request for comment.
Fastly reported its technical issues Tuesday morning around 5:58 a.m. ET and said that it had fixed the issue that caused a global outage of its services at around 8:40 a.m. ET.
It’s not uncommon for online trading and wealth management websites to go dark in instances like widespread internet outages. Most recently, unprecedented periods of market volatility since March 2020 coupled with a spike in user volume have exposed cracks in online brokerage platforms.
A handful of trading and wealth management websites have experienced technical difficulties over the last year as a result of unprecedented volumes of activity. For example, Charles Schwab Co., ETrade Financial Corp., TD Ameritrade Inc., Robinhood Inc., Fidelity Investments Inc., Merrill Lynch & Co Inc. and Vanguard Group Inc. have all experienced some sort of technical difficulty — from login issues to slower processing speeds — while trading volumes surged, according to DownDetector.
In fact, the number of problems cited by customers have doubled during the past year, with website issues, processing and trade execution failures and account statement errors leading the way.
Frequent glitches are bringing down customer satisfaction, according to J.D. Power. In fact, incidences of technical difficulties have doubled in the past year, affecting 11% of all do-it-yourself investors and 12% of those in the seeking guidance segment of self-directed investors, according to the study based on responses from 4,895 investors fielded from December 2020 through February 2021.
Leading online and mobile brokerage platforms cracked and sputtered with outages under the surge of speculators trading in high-risk stocks like GameStop Corp. and AMC Entertainment Holdings Inc., in January.
The brokers with outages or problems during the GameStop frenzy included Fidelity, the Charles Schwab Corp., TD Ameritrade, ETrade Financial Corp. and Robinhood.
Learn more about reprints and licensing for this article.
