- Published: April 2014
- Region: Global
Securities Brokeragesin the US
- Published: March 2014
- Region: United States
- 10 pages
- First Research
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Brief Excerpt from Industry Overview Chapter:
Companies in this industry broker deals for buyers and sellers of securities. Major companies include Edward Jones, INTL FCStone, and brokerage units of Citigroup, Goldman Sachs, and Morgan Stanley (all based in the US), as well as Credit Suisse (Switzerland), Deutsche Bank (Germany), Macquarie Group (Australia), and Nomura (Japan).
The global securities brokerage industry generates about $2 trillion in underwriting activity each year. Many large US-based brokers, particularly those affiliated with major banks and financial services companies, operate internationally.
The securities brokerage industry in the US includes about 7,500 companies with combined annual revenue of about $140 billion. Key growth drivers include improving economic conditions and increased transaction volume.
Demand is driven by the returns on securities relative to alternative investments. The profitability of individual companies depends on efficient operations and good marketing. Large companies have economies of scale in operations and high name recognition. Small companies can compete effectively by offering better customer service. The US industry is highly concentrated: the top 50 companies account for more than 80 percent of revenue.
The traditional brokerage industry that sold stocks to individual investors has largely evolved into companies that either broker large stock trades for institutional investors or sell a variety of investment products to individuals. Instead of buying individual securities, many individuals now invest in mutual funds.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major services are stock brokerage, investment advice, brokerage of bonds and derivatives, and the brokerage of mutual funds.... SHOW LESS READ MORE >
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