| 19 March 2010

We find it interesting to learn, as reported in the Wall Street Journal, that optionsXpress (OXPS) CEO David Fisher is reiterating his desire to enter foreign markets at the same time that E*TRADE Financial (ETFC) has been continuing its long, slow drag out of all of its foreign subsidiaries. Apparently the two aren't sharing much information about the difficulties of expanding internationally.

"We don't have much of a footprint in foreign markets," Fisher said in an interview. "But you have to weigh the additional challenges against the opportunity."

The biggest challenge as we see it is cultural. Too many U.S. operators make the mistake of assuming that the world trades like we do. It's just not the case, both in terms of a regulatory framework and a customer behavior.

E*TRADE learned the hard way, and they have struggled to unwind those operations. Even finance sites like Motley Fool and Yahoo (YHOO) have struggled with relatively simple implementations of international investing content in the U.K, Singapore and other areas.

We believe that the opportunity in the U.S. far outweighs the growth potential internationally, with far fewer complications. This, despite the fact that optionsXpress reported a 17% dip in trading activity in February.

But we will keep an eye on these efforts, to be sure. It is possible the leaders at optionsXpress have discovered some potential international acquisition opportunities and they're warming the markets to the idea. Mr. Fisher first mentioned the idea of an international expansion to Reuters in October.