Loyalty strong among Australian online broking clients
Australian online broking clients are the most loyal in the world, despite mid-ranking levels of satisfaction with their brokers.
These are the findings of Investment Trends’ global online broking report, which surveyed 92,000 participants in six countries and found that 72 per cent of Australians rated their main online broker as good or very good for overall quality of service, compared to 85 per cent in the United States and 88 per cent in Germany.
Over the 12 months to December 2012, however, only 7 per cent of Australian online share traders switched their main broker. This was fewer than the percentage numbers reported in the US, United Kingdom, Germany, France and Singapore.
“Five hundred and fifty thousand Australians, or 3.2 per cent of the adult population, traded shares online last year, giving Australia a market penetration second only to Singapore,” Investment Trends stated.
Investment Trends chief executive Mark Johnston said Australia bucked the trend in relation to the traditional link between lower client satisfaction and higher levels of switching.
Although Australian brokers scored lower across customer service, value for money, trading ideas and strategies compared to other markets, they ranked best in the world for online reporting of positions and transactions, and second only to the US for website functionality.
The US market itself came out on top in 11 of the 14 service areas that were compared. In addition, nine of the top 10 online brokers in the world were from the US, with Vanguard taking the top spot.
The report also found that when compared to world standards, Australia is highly concentrated, with the top five brokers accounting for 84 per cent of the clients.
Despite most Australian brokers being clustered in the middle of the 72-strong list, Bell Direct ranked 11th overall. This was followed by CMC Markets Stockbroking (31), CommSec (33) and ETRADE (35).
Recommended for you
The month of April enjoyed four back-to-back weeks of growth in financial adviser numbers, with this past week seeing a net rise of five.
ASIC has permanently banned a former Perth adviser after he made “materially misleading” statements to induce investors.
The Financial Services and Credit Panel has made a written order to a relevant provider after it gave advice regarding non-concessional contributions.
With the election taking place on Saturday (3 May), Adviser Ratings examines how the two major parties could shape the advice industry in the future.
