Like other online brokers,

E*Trade Financial

(ET) - Get Report

reported strong customer stock trading for January, but hinted that February will be less impressive.

The New York-based company said it processed an average of 182,837 revenue- producing trades a day last month, up 39% from 131,553 in December. Retail DARTS, or daily average revenue trades, rose 40% in January to 123,910, while professional DARTS climbed 37% to 58,927.

"Retail DART volumes in January reached the highest levels in three years," said President and Chief Operating Officer R. Jarrett Lilien.

Analysts were encouraged by the results and by a 9.7% increase in margin balances, which suggests investors are taking on more risk. E*Trade has been benefiting from continued strength in the stock market this year, which has boosted revenue from commissions.

In an interview with

Dow Jones Newswires

Wednesday, E*Trade's Lilien said the firm's performance in January was "at or above levels that correspond with the high end of our guidance" for this year. E*Trade has said it expects to earn 70 cents to 85 cents a share in 2004. Still, Lilien also told the news agency that February is typically a slower month than January.

On Tuesday,

Charles Schwab

(SCH)

, the biggest online broker, said daily average revenue trades rose 28% to 215,000 in January compared to December. But the firm also noted that the pace of trading "has moderated thus far in February."

Earlier this month, rival

Ameritrade

(AMTD) - Get Report

said average daily trading volume jumped 40% in January to 254,000, a record high. The firm also raised the lower end of its earnings guidance. But in an interview with

TheStreet.com

in late January, CEO Joe Moglia said he wouldn't be surprised to see trading activity slow "a little bit" going forward.

Shares of E*Trade rose 2.6% to $15.35 while Schwab gained 1% to $13.09. Ameritrade was up 0.3% at $17.22.