Global E-Brokerages Market - Growth, Trends, COVID-19 Impact, and Forecasts (2021 - 2026)

The Global E-brokerage Market is a fragmented market and is segmented based on the geography (Middle East, South America, Asia-Pacific, etc). - Growth, Trends, and Forecast (2020-2025)

Market Snapshot

Global E-Brokerages Market (2020-2025)
Study Period: 2016 - 2026
Base Year: 2020
Fastest Growing Market: Asia Pacific
Largest Market: South America
CAGR: 4 %

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Market Overview

E-brokerages can be defined as order execution - buying and selling - of securities which includes but not limited to stocks, warrants, derivatives, bonds, mutual funds, ETF etc., over the internet. Traditional banks and brokers provided online trading and served the purpose since 2000. Internet-only banks and online exclusive brokers offering a genuine e-commerce model taking cost-saving advantage at the same time. Later the dot.com bubble deprived their fortunes and eventually the traditional players acquired and adopted their business models.

Brokerages are fairly diversified today. Along with fulfilling orders the players offer other investment strategies and other financial advisory services. A big chunk of their topline comes from filling buy and sell orders from clients. Commission and fee-based revenue come from the principal transactions. Along with it, interest income earned from investments and dividends, investment banking revenue through underwriting and advisory services. The companies in this industry have varying levels of debt. Large brokers doing significant investment banking business often carry heavy debt burdens. While conservative companies are those who tend to depend on commissions and hold lighter debt balances.

The electronification of FX markets has led to increased competition. Firms started compliance technology spending and many structural changes have come in place.

Scope of the Report

An understanding of the online brokerage houses and their business models, along with detailed market segmentation, product types, current market trends, changes in market dynamics, and growth opportunities. In-depth analysis of the market size and forecast for the various segments.

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Key Market Trends

Zero commission in United States equity markets change market dynamics

United States Securities Acts Amendments of 1975 ended fixed trade commissions. Since then the equity commissions have been on a downward trend for both institutional and retail clients. In 2019, this culminated to zero commission trading for retail investors in United states. For a few years, the mobile app-based brokerage Robinhood Markets Inc. has offered not only free trades but also a $0 minimum balance as a way to draw in millennial investors. And big financial-services companies have been cranking out other kind of free offers. In 2018, Fidelity Investments Inc. initiated index funds with zero fees, and JPMorgan Chase & Co. rolled out a service that offered clients 100 commission-free stock and ETF trades in their first year.

Brokerages also make money by catering to investment advisers, loaning customers cash to buy stocks on margin, and lending out securities to short sellers hoping to profit on a decline in prices. One of the greatest sources of revenue for brokers is to invest or loan out the money clients don’t have in play in the market which is put into banking subsidiaries of brokerage houses. The revenue loss from implementing zero-commission can be covered from the surge in customer base. The revenue breakup of a few major brokerage houses indicates the hidden potential of such other sources of revenue for brokers.

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Customer Satisfaction of Online Brokerage Services

Most of the online brokers are more suppliers of tools rather than providers of advice. They provide charts, research and execution tools but stop short of recommending specific investment ideas. That's different from a firm that acts as an investment advisor. Once the brokerage industry went online, investing became more of a do-it-yourself endeavor. One-on-one advice that provides specific investment ideas still exists, but typically with higher-commission accounts. Some stock brokerages have a sort of hybrid model in which they recommend asset allocations depending on clients' goals. And brokers that have their own analysts, such as MerrillEdge, make their company research reports available to clients.

There is no doubt to say that agents remained as the main distribution channel in the region, but some market sources indicate the distribution share might converge at 50% bancassurance, 30% agents and 20% other channels in the future. Despite the digital wave, hybrid strategies may likely defend this distribution model and help the insurers provide an omni-channel experience to the customers.

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Competitive Landscape

The report includes an overview of e-brokerage houses operating across the worldwide and within one or a few countries. We wish to present a detailed profiling of e-brokerage which covers the minimum deposits, regulations governing them, their headquarters, benefits, suitability for which product type, fees collected and general pros and cons of each online brokerage house. Currently, some of the major players dominating the market are listed below.

Table of Contents

  1. 1. INTRODUCTION

    1. 1.1 Study Deliverables

    2. 1.2 Study Assumptions

    3. 1.3 Scope of the Study

  2. 2. RESEARCH METHODOLOGY

  3. 3. EXECUTIVE SUMMARY

  4. 4. MARKET DYNAMICS

    1. 4.1 Market Overview

    2. 4.2 Regulations Governing The E-brokerages Over Various Regions

    3. 4.3 Technological Advancements Such As Regtech, Blockchain, Data Analytics, etc Changing The Market Dynamics

    4. 4.4 Insights on Products And Services Offered by Online Brokers Across The Globe

    5. 4.5 Market Drivers

    6. 4.6 Market Restraints

    7. 4.7 Value Chain / Supply Chain Analysis

    8. 4.8 Porters 5 Force Analysis

    9. 4.9 Impact of COVID-19 On The Market

  5. 5. MARKET SEGMENTATION

    1. 5.1 Geography

      1. 5.1.1 North America

        1. 5.1.1.1 US

        2. 5.1.1.2 Canada

        3. 5.1.1.3 Mexico

        4. 5.1.1.4 Rest of NA

      2. 5.1.2 Europe

        1. 5.1.2.1 Germany

        2. 5.1.2.2 UK

        3. 5.1.2.3 France

        4. 5.1.2.4 Russia

        5. 5.1.2.5 Spain

        6. 5.1.2.6 Rest of NA

      3. 5.1.3 Asia Pacific

        1. 5.1.3.1 India

        2. 5.1.3.2 China

        3. 5.1.3.3 Japan

        4. 5.1.3.4 Rest of AP

      4. 5.1.4 South America

        1. 5.1.4.1 Brazil

        2. 5.1.4.2 Argentina

      5. 5.1.5 Middle East

        1. 5.1.5.1 UAE

        2. 5.1.5.2 Saudi Arabia

        3. 5.1.5.3 Rest

  6. 6. COMPETITIVE LANDSCAPE

    1. 6.1 Vendor Market Share

    2. 6.2 Mergers & Acquisitions

    3. 6.3 Company Profiles

      1. 6.3.1 Interactive Brokers

      2. 6.3.2 Charles Schwab

      3. 6.3.3 Fidelity Investments

      4. 6.3.4 TD Ameritrade

      5. 6.3.5 E-Trade

      6. 6.3.6 TastyWorks

      7. 6.3.7 Etoro

      8. 6.3.8 X-Trade Brokers

      9. 6.3.9 IC Markets

      10. 6.3.10 Eoption

      11. 6.3.11 First Prudential Markets*

    4. *List Not Exhaustive
  7. 7. MARKET OPPORTUNITIES AND FUTURE TRENDS

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Frequently Asked Questions

The Global E-Brokerages Market | Growth, Trends, and Forecast (2020-2025) market is studied from 2016 - 2026.

The Global E-Brokerages Market | Growth, Trends, and Forecast (2020-2025) is growing at a CAGR of 4% over the next 5 years.

Asia Pacific is growing at the highest CAGR over 2021- 2026.

South America holds highest share in 2020.

Fidelity Investments, Charles Schwab Corporation, E-Trade, Interactive Brokers, Etoro are the major companies operating in Global E-Brokerages Market | Growth, Trends, and Forecast (2020-2025) .

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