Security Brokerage Market Assessment, By Service [Order Execution, Advisory, Others], By Type [Full-service Brokers, Discount Brokers, Robo-Advisors, Brokers-Dealers], By Mode [Offline, Online], By Trading Type [Short-term Trading, Long-term Trading], By

Security Brokerage Market Assessment, By Service [Order Execution, Advisory, Others], By Type [Full-service Brokers, Discount Brokers, Robo-Advisors, Brokers-Dealers], By Mode [Offline, Online], By Trading Type [Short-term Trading, Long-term Trading], By End-users [High Net-worth Investors, Retail Investors, Institutional Investors], By Region, Opportunities and Forecast, 2017-2031F

Global security brokerage market is projected to witness a CAGR of 6.54% during the forecast period 2024-2031, growing from USD 45.68 billion in 2023 to USD 75.83 billion in 2031. Factors such as regulations in demand for trustworthy, fast, and efficient order execution, the rise of favorable government regulations, increasing demand for demat accounts, and the need for market supervision primarily drive the growth of the global security brokerage market. On the contrary, the emergence of AI and algorithms in financial services is expected to provide profitable opportunities for market growth during the forecast period.

Global security brokerage market is a financial industry segment focused on facilitating the buying and selling of stocks and other securities on behalf of investors. The market involves participants like high net-worth individuals, retail, and individual investors. Stockbrokers act as intermediaries between the buyers and sellers of stocks. They execute orders on behalf of clients, providing access to stock exchanges and other trading platforms. Regulations set by various exchange boards worldwide regulate brokerage firms' operations, including accreditation requirements, compliance standards, and investor protection strategies. The stockbroking market plays a crucial role in the functioning of financial markets by facilitating capital formation, price discovery, and investment opportunities for individuals and institutions alike.

Increased Corporate Earnings Promote the Growth

Earnings are the foundation of stock valuation and are directly relevant to a company's stock price. Positive price/earnings growth indicates a strong, flourishing company, and thriving companies tend to draw more investors and increase demand for their stock. The rise in demand affects the stock price, leading to an expansion of the market. Better-than-expected profits are followed by a rise in market confidence as they indicate an improvement in the company's financial performance. Market-wise positive environment is created, gaining investors’ confidence, and nurturing market expansion. The increased investment in businesses with promising future profits raises the prices of those businesses' stocks and helps the market to grow. S&P 500 corporate earnings grew to 5% in the first quarter of 2024. Analyst reports and earnings projections can affect investor behavior as they give detailed information about a company's future, thus, driving the global security brokerage market revenue.

Investments in Real Time Drives Growth in the Market

Utilizing an online stockbroking platform makes real-time monitoring of investments much easier. Users have access to a strong set of tools and resources made ready for use by various online trading organizations. These resources provide users with information that can be used to make their trading transactions more successful. Online trading platforms could easily monitor the performance of their assets, owing to real-time stock data. According to data in 2023, the United States ranks first in the total population participating in the stock market with 55 percent population. Traders can record their portfolio performance and determine the necessary changes required to get a suitable outcome. Traders can generate real-time trading notifications to implement their strategy. Through digital data, traders can study their previous businesses, learn from their mistakes, and find the best solutions. Thus, this factor drives the growth of the global security brokerage market.

North America Dominated the Market

According to region, North America dominated the global security brokerage market share. In North America, the stockbroking market includes the stock exchange, brokerage firms, online trading, regulatory bodies, and high-frequency trading. The United States has an established and developed stockbroking market. It has well-known global exchanges, the New York Stock Exchange and NASDAQ, which are the largest and most significant markets in the world.

Asia-Pacific security brokerage market is projected to grow the fastest due to significant stockbroking markets in various countries such as China, Japan, India, and Singapore. India security brokerage market is the fastest growing market in Asia-Pacific. In India, the total number of demat accounts increased to 15.14 million in March 2024. According to Motilal Oswal Financial Services, new account additions soared to 3.1 million in the previous month.

Order Execution Segment Dominated the Market

Based on services, the order execution segment dominated the global security brokerage market share in 2023. It is attributed to the fact that the popularity of online stockbrokers has significantly brought down the cost of buying and selling stocks. Order execution is greatly dominated by liquidity and financial market structure. It is typically faster and more successful in highly liquid marketplaces when there are more buyers and sellers. Illiquid markets, on the contrary, can cause execution to slow down or price slippage. They do market analysis and risk calculations and recommend investment decisions to their clients according to their needs.

Long-Term Trading Dominated the Market

Based on trading type, the market has been bifurcated into long-term and short-term trading. The long-term trading segment accounts for the larger share of the market. A trader holding an asset like an estate for a longer period, that is, greater than 1 year is called long-term trading. Depending on the type of security, assets can be held for as short as less than equal to one year or as long as 30 years or more. Long-term investment usually involves a holding period of at least 7-10 years, however, there is no fixed rule. For instance, as an investment an individual can buy and sell a stock if its value rises within a few weeks or months. Similarly, the same stock can be held for years and sold when it goes higher. Due to both long-term perspective and compounding factors, investors can use time to consider their risks contribution towards the expansion of the market in focus during the forecast period.

Future Market Scenario (2024 – 2031F)

Integrated investment enables businesses to offer customers routes to funds and stocks. It allows companies to merge stock market investing capabilities into their existing product offerings. API-based brokerage firms are trending by providing APIs to manage end-to-end flows like opening demat accounts, trading, management, and market data.

In April 2024, Tradestation Securities Inc. collaborated with Optionsplay, allowing users to trade directly from the OptionsPlay platform with customized pricing and providing them with access to OptionsPlay’s additional service offerings like research and equity analytics, trade ideas, and watch lists, trading, and income strategies, as well as trading tools and education.

Key Players Landscape and Outlook

The top stockbroking firms in the global market are growing and adapting to the fast-paced environment by diving into advanced technology in the trading field. They are using API, AI, and ML tools to provide a user-friendly environment in trading and instant access to market data and everything for individuals and investors. With the increased use of AI, the decision-making facility has increased a plethora.

Recently, Interactive Brokers Group Inc. launched the next-generation trading platform IBKR Desktop which offers global access to stocks and options on over 150 markets along with tools such as Multisort and Option Lattice. Option Lattice is a graphical option chain highlighting potential key metrics such as implied volatility, open interests, and many more. These developments are catering to the growth of global security brokerage market with the technological advancements that are making trading user-friendly.