Favorable trends: The industry will likely benefit from its widespread efforts to diversify revenue streams
Securities Brokering in the US
The Securities Brokering industry primarily serves as an intermediary between investors and investment securities such as stocks, bonds and derivatives. With the rise of electronic trading and discount brokering, many industry operators have started to offer more value-added services such as investment advice for clients. As a result, the industry has become increasingly indistinguishable from the Financial Planning and Advice industry (IBISWorld report 52393). Over the five years to 2019, slow economic and financial market recovery, coupled with contracting securities trading volumes, caused revenue to drop in 2015 before slowly starting to improve. Moreover, the average industry profit margin has also been constrained due to intense competition from online trading platforms that eliminate the need for financial intermediaries. Operators have responded to this trend by increasing their financial services offerings and transitioning to an asset-based fee structure characteristic of the Financial Planning and Advice industry. Over the five years to 2024, continued merger and acquisition (M&A) activity will enable financial firms to capitalize on operational synergies, larger client bases and new financial advisory business segments.
Companies in this industry act as agents that arrange transactions between securities buyers and sellers on a commission or transaction-fee basis. The Securities Brokering industry continues to converge with various other securities and banking industries due to regulatory, technological and market trends.
This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares.