Online brokerage eTrade plans to offer an Internet-based foreign exchange trading platform in Hong Kong, two months after pulling the plug on its equities-trading operations in the city. Chief executive Mitchell Caplan said Hong Kong was the best place in Asia to start the online foreign-currency trading service. 'Hong Kong is the world's seventh-largest forex trading market. It is an international financial centre suitable for launching international products,' he told the South China Morning Post yesterday. He said the company planned to launch the online forex trading services here by the end of this year or early next year, while it had been in talks with the Securities and Futures Commission concerning a licence. The world's third-largest online brokerage terminated its online stock-trading services in Hong Kong in July because it wanted to shift its focus back to the US. Mr Caplan said the company could make good profits on trading US stocks online in Hong Kong but could not earn much in its Hong Kong stock-broking business. 'There are so many local stocks we need to do research on. There are so many local stock brokers we need to compete with. The trading volumes in US stocks are far bigger than those in Hong Kong stocks,' he said. Despite failure in online stock trading, Mr Caplan believes online foreign-currency dealing in Hong Kong will be successful. 'Foreign-currency trading is part of a global business. We could share the back-office and research with what we are doing in the European and British markets. It is much more cost effective than online Hong Kong stock trading.' The next step, he said, would be an expansion into China when Beijing opened the market. Like many other online brokers, Mr Caplan said, the company had recorded growth in trading on the economic recovery and a rally in US stocks. Rival Charles Schwab Hong Kong, which also offers US online stock trading for Hong Kong investors, in June recorded more than 217 per cent growth in turnover compared with a year earlier.