Online brokerage business grow on the crisis of global broker firms

The latest prognosis made by the consulting firm Aite Group says that online US discount brokerages are expected to attract more of their customers and assets in the years ahead. While the largest brokerages in America owned by banks declined during the financial crisis and suffered resignations of qualified brokers as well as departures of customers, online brokers were succeeding in their business. They have managed to increase online brokerage share of the $12.4 trillion in total U.S. client assets by 0.8 percentage points to 12 percent.

Making forecast up to 2013 Aite see Fidelity Investments expanding to 13.5 million accounts from 12.4 mln accounts in October. Charles Schwab Corp is likewise seen adding 1 million accounts to 8.9 million accounts, while TD Ameritrade may jump to 9.2 million accounts from 7.9 million. Meanwhile, the No. 4 online broker, ETrade Financial, is expected to have 3.9 million, up from 3.7 million accounts. Aite based its projections on recent reported growth rates.

The online brokers "all saw a substantial increase in their numbers of clients during crisis years. These growth rates, in a recession environment, indicate the online firms are taking share," Aite wrote.

Independent investment advisers gained 1.5 percentage points to 12 percent. The biggest brokerages lost some ground --- nearly one percentage point -- but remained dominant with 38 percent of the market, Aite said.

"Now that investors have experienced significant portfolio losses, they have become more cautious with their investment dollars," Aite said. "They seek more control over their investments, such that they can make their own adjustments."