South Africa Security Dealing Activity Insights Report 2024: Brokerage Fees Come Under Pressure, Many Brokers are Diversifying by Integrating Asset Management Services into their Offerings

Dublin, Aug. 15, 2024 (GLOBE NEWSWIRE) — The “Security Dealing Activities in South Africa 2024” report has been added to ResearchAndMarkets.com’s offering.

The stockbroking industry is currently navigating significant challenges due to declining trade volumes and values on the JSE, driven by ongoing delistings and negative market sentiment. The value of shares traded has decreased further in the early months of 2024, following a near 10% drop in 2023. As brokerage fees come under pressure, many brokers are diversifying by integrating asset management services into their offerings.

Despite these challenges, there is an expected rise in retail investment products, particularly through online platforms, and a growing investor optimism towards South African equities. Cryptocurrency trading is also gaining traction, with several exchanges and investment firms collaborating with the financial industry to offer crypto assets to the public.

The industry is seeing consolidation, with the top 10 brokers on the JSE increasing their market share. Local markets have been impacted by various crises, including loadshedding and underperforming infrastructure. However, there is a growing bullish sentiment towards South African equities among investors.

Market trends indicate a growing emphasis on advice and training for retail clients, the increasing role of AI in trading and client service, and a cautious yet growing acceptance of cryptocurrency. The industry is also witnessing a surge in sustainability-linked investment products, increased interest in government bonds, and a shift from active to passive investing.

Retail investment is expanding, fueled by the proliferation of smartphones, trading apps, and online platforms, with social media making investment analysis more accessible. Stablecoins are gaining popularity as a hedge against bitcoin volatility, and there has been a significant net inflow into hedge funds. Additionally, the percentage of black investor clients of stockbrokers has increased notably, although the overall number of stockbrokers is likely to decline as JSE trading volumes continue to drop.

Market Opportunities

• Expanding to offer financial services alongside stockbroking services.
• Offering retail trading clients advice and training.
• Research on small and mid-caps listed on local exchanges.
• Selling cryptocurrency products.
• Selling sustainability-linked investment products.
• Selling trading products to more black clients.
• Using AI to create robo-advisors and to execute trades.

Market Challenges

• Analyst coverage of listed companies, particularly small and mid-caps has declined.
• Delistings and the decline in the value of listed companies’ shares due to the slowing economy.
• Fraud is a major challenge particularly in cryptocurrency.
• Increasing risk of cyberattacks on exchanges.
• JSE trade volumes have fallen dramatically in recent months.
• Only a few local stockbrokerages are black-owned.
• Several multinational firms have closed or downscaled their local operations, leading to decreased competition in the sector.
• South Africa’s greylisting has affected capital raising and stockbrokers from signing on new clients.
• The performance of local exchanges has been affected by the poor local and global economic environment.

Key Topics Covered:

1. INTRODUCTION

2. DESCRIPTION OF THE INDUSTRY
2.1 Industry Value Chain
2.2 Geographic Position
2.3 Size of the Industry

3 LOCAL
3.1 State of the Industry
3.2 Key Trends
3.3 Key Issues
3.4 Notable Players
3.5 Corporate Actions
3.6 Regulations
3.7 Enterprise Development and Social Development

4. AFRICA

5. INTERNATIONAL

6. INFLUENCING FACTORS
6.1 Economic Environment
6.2 Labour
6.3 Environmental Issues
6.4 Technology, R&D, Innovation
6.5 Input Costs
6.6 Cybersecurity and IT Risks
6.7 Fraud

7. COMPETITIVE ENVIRONMENT
7.1 Competition
7.2 Ownership Structure of the Industry
7.3 Barriers to Entry

8. INDUSTRY SUMMARY

9. OUTLOOK

10. INDUSTRY ASSOCIATIONS

11. REFERENCES
11.1. Publications
11.2. Websites

ANNEXURE – Relevant Legislation

APPENDIX – Summary of Notable Players

Companies Featured

• A 2 X (Pty) Ltd
• A Trade (Pty) Ltd
• Absa Capital Securities (Pty) Ltd
• Absa Stockbrokers And Portfolio Management (Pty) Ltd
• Afrifocus Securities (Pty) Ltd
• Altify SA Das (Pty) Ltd
• Anchor Stockbrokers (Pty) Ltd
• Avior Capital Markets (Pty) Ltd
• Cape Town Stock Exchange (Pty) Ltd (The)
• Citigroup Global Markets (Pty) Ltd
• Easycrypto (Pty) Ltd
• First World Trader (Pty) Ltd
• FNB Stockbroking And Portfolio Management (Pty) Ltd
• Independent Securities (Pty) Ltd
• Integrated Exchange (Pty) Ltd (The)
• Investec Wealth And Investment International (Pty) Ltd
• J P Morgan Equities South Africa (Pty) Ltd
• JSE Ltd
• Kela Securities (Pty) Ltd
• Luno (Pty) Ltd
• Merrill Lynch South Africa (Pty) Ltd
• Momentum Securities (Pty) Ltd
• Navigare Securities (Pty) Ltd
• Nedgroup Private Wealth Stockbrokers (Pty) Ltd
• Nedgroup Securities (Pty) Ltd
• Nvest Securities (Pty) Ltd
• Peresec Prime Brokers (Pty) Ltd
• Prescient Securities (Pty) Ltd
• PSG Financial Services Ltd
• Purple Group Ltd
• Rand Swiss (Pty) Ltd
• RMB Morgan Stanley (Pty) Ltd
• RMB Securities (Pty) Ltd
• SA Stock Brokers (Pty) Ltd
• Sanlam Private Wealth (Pty) Ltd
• Sasfin Securities (Pty) Ltd
• SBG Securities (Pty) Ltd
• Sinayo Securities (Pty) Ltd
• Trive South Africa (Pty) Ltd
• TSB Securities (Pty) Ltd
• UBS South Africa (Pty) Ltd
• Valr (Pty) Ltd

For more information about this report visit https://www.researchandmarkets.com/r/ha1ibi

About ResearchAndMarkets.com
ResearchAndMarkets.com is the world’s leading source for international market research reports and market data. We provide you with the latest data on international and regional markets, key industries, the top companies, new products and the latest trends.

CONTACT: CONTACT: ResearchAndMarkets.com 
         Laura Wood,Senior Press Manager 
         press@researchandmarkets.com
         For E.S.T Office Hours Call 1-917-300-0470 
         For U.S./ CAN Toll Free Call 1-800-526-8630 
         For GMT Office Hours Call +353-1-416-8900