Online brokers face increased competition. There is little differentiation in offerings and margins are diminishing. Trading-focus limits the percentage of the client’s total assets available for revenue generation. This reliance on transactional revenues also makes income streams volatile, with no reliable recurring revenues.
- Widens the product offering for the online broker
- Extends the percentage of clients’ assets available
- Enhances brand and pricing power through differentiated products
- Provides scope for AUM-based fees due to access to wider wealth management
- Increases margins and offers more stable revenues as a result of a diversified offering