E-Brokerage Market Expected to Reach $31.1 Billion by 2032—Allied Market Research

According to a new report published by Allied Market Research, titled, “E-Brokerage Market," The e-brokerage market was valued at $11.7 billion in 2022, and is estimated to reach $31.1 billion by 2032, growing at a CAGR of 10.6% from 2023 to 2032.

E-brokerage is a platform that allows investors to execute trades electronically without the need for direct human intervention. E-brokerage firms offer individuals or entities the ability to trade securities online, anytime, and anywhere in the world, as long as they have internet access. This platform uses a variety of market data, tools, and reports to assist investors in making informed investment decisions. Moreover, e-brokerage firms offer a wide range of investment products and services, including stocks, bonds, mutual funds, exchange-traded funds, options, and futures contracts.

Furthermore, it enables investors to monitor and manage their investment portfolios efficiently. Investors can view their holdings, track performance, set alerts and notifications, and generate reports for tax purposes. Some platforms also provide automated portfolio rebalancing and asset allocation features. In addition, e-brokerage firms typically offer customer support through various channels, including phone, email, and online chat. They provide assistance with trading-related queries, technical issues, and account management.

The increasing penetration of the internet has been a significant driver of the e-brokerage market. As more people gain access to the internet, they are more likely to use online brokerage services. Furthermore, key players in the e-brokerage market have recognized this trend and have invested in expanding their online presence. For instance, Fidelity has developed a robust online platform that allows clients to trade, access account information, and manage their investments.

Furthermore, with the growth of digitalization and the use of the internet, the online brokerage industry has experienced significant growth. Technology has made it possible for brokers to offer a wide range of trading tools and services to their clients, such as real-time quotes, research, and analysis tools. In addition, the main drivers of the e-brokerage market are the convenience and cost-effectiveness that online trading platforms offer. However, security concerns, regulatory issues, and less investor awareness are some of the factors that hamper the market growth. On the contrary, the increasing adoption of mobile trading platforms and the development of new technologies such as artificial intelligence, machine learning, and big data analytics are expected to create new opportunities for the growth of the e-brokerage market in the upcoming years.

By ownership, the publicly held segment acquired the highest share in the e-brokerage market size in 2022. Publicly held ownership provides investors with the opportunity to participate in the company's ownership and potential profits by buying shares in the open market. E-brokerage platforms enable investors to access and trade these publicly held shares electronically, offering a convenient and efficient way to engage in buying and selling securities. These e-brokerage market trends contribute to the growth of the publicly held segment.

However, the privately held segment is attributed to be the fastest-growing segment during the forecast period. E-brokerage platforms have contributed to the democratization of investing by enabling broader access to financial markets. They removed barriers to entry, allowing individuals with limited capital to participate in trading and investing activities. Private e-brokerage firms can leverage this trend by targeting specific customer segments, such as millennials or first-time investors, and offering services tailored to their needs.

Region wise, North America dominated the e-brokerage market share in 2022. This was attributed to the result of a rapid increase in the adoption of high-speed internet, and mobile devices, and a growing awareness of online trading. With these trends, more investors are turning to e-brokerage platforms to execute trades, monitor their investments, and manage their portfolios. Furthermore, online brokerages typically charge lower transaction fees compared to traditional brokerage firms, making it more affordable for small investors to enter the market.

However, Asia-Pacific is considered to be the fastest-growing region during the forecast period. With the increasing availability of affordable smartphones and internet connectivity, more people in Asia-Pacific are accessing the internet, which has led to a surge in online transactions, including investments. Furthermore, several governments in the region are introducing policies that encourage the growth of the e-brokerage industry. For instance, India's SEBI has allowed e-brokers to operate without physical offices, reducing operational costs. Therefore, these factors contribute to the e-brokerage market growth.

The COVID-19 pandemic had a significant impact on the e-brokerage market size. Due to lockdowns and restrictions, there was a surge in retail trading activity. Individuals sought new opportunities to invest and engage in financial markets, leading to a substantial increase in the number of retail investors. This resulted in a boost for e-brokerage platforms as they provided easy access to trading and investment services. In addition, the pandemic accelerated the adoption of digital technologies across various industries, including finance.     

Key Findings of the Study

• On the basis of service provider, the full time broker segment accounted for the highest e-brokerage market share, in terms of revenue in 2022.
• On the basis of ownership, the publicly held segment is expected to exhibit the fastest growth rate during the forecast period.
• On the basis of region, North America generated the highest revenue in 2022.  

The key players operating in the e-brokerage market analysis include Charles Schwab & Co., FMR LLC, E*TRADE, Interactive Brokers LLC, eToro, FP Markets, eOption, tastytrade, Inc., XTB, and TD Ameritrade. These players have adopted various strategies to increase their market penetration and strengthen their position in the industry.