How do brokers keep clients from leaving?

Discussion in 'Stocks' started by .sigma, May 29, 2020.

  1. ZBZB

    ZBZB

    Look at the data. Number of brokerage accounts has exploded higher because of Covid 19. Also number of trades per day is at the highest ever. Sports gamblers are trading stocks because there are no sports. People have no jobs and are under stay at home orders so they are trading from home.

    Your paper could be the most naive ever.
     
    #11     May 30, 2020
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  2. ajacobson

    ajacobson

    If an ACAT has been filed it's too late. If they are griping and fishing for something then it depends on account profitability and anything they have that may still have fees imbedded. If the firm has a bank in its ownership umbrella - they throw the bank at them. If it's a size account and profitable you look to negotiate better rebating(if any), access to third party research, availability of a low usage server, access to product specialists, priority access to firm conferences. Generally, anything FINRA still allows. Tell Schwab you've been courted by Fidelity or vice versa and they'll sit up. In some cases where a capital market side exists the first offer is usually better access to IPOs.
     
    #12     May 30, 2020
    .sigma likes this.
  3. .sigma

    .sigma

    thanks for the reply, can you please link me to your source of that data?
     
    #13     May 30, 2020
  4. .sigma

    .sigma

    Thus when a customer calls demanding liquidating, what’s your sell? You can be vague I’m just gathering ideas on how brokers KEEP clients, I understand it’s the clients right to liquidate whenever, but I know there must be some tier or pitch the brokers use to maybe change the clients mind?
     
    #14     May 30, 2020
  5. ajacobson

    ajacobson

    If you need hard data and have a friend senior in the industry ask to see their McLagen report.
    Needs to be a good friend.
     
    #15     May 30, 2020
  6. MattZ

    MattZ Sponsor

    I am trying to be as direct as I can to help you. Your question is out of context and in the wrong order.
    The question you should ask first is "How do brokers attract clients?" What is the basis of the customer opening the account from the first place? Was it technology, or commissions, performance, Back-office? etc.
    Then, were the customer needs met? Yes/No

    Your question and example were related to performance. So the question is what was the customer's experience was when he/she wants to pull out? That would dictate a lot of the context that would follow.
    If the broker is just an execution broker, or just provides technology, then what could the broker say?
    If it's a final advisor, he or she may go over the portfolio to address the customer's concerns.
    So again, it all depends on the role of the customer and their broker/advisor.
     
    #16     May 30, 2020
  7. lovethetrade

    lovethetrade Guest

    Why not use the same pitches that many of the market pundits were using during this crisis.

    "Buy the dip"
    "The Fed is committed to doing 'whatever it takes'
    "It's just another flu"
    "This is panic-driven correction"
    "Don't fight the Fed"
    "Now is not the time to liquidate"
    "Be fearful when others are greedy and greedy when others are fearful"

    A slightly more ethical approach during great uncertainty would be to recommend they continue their long term buy-and-hold strategy and/or to rotate into stocks/sectors that benefit from the lockdown and then other sectors that will improve during the recovery phase.
     
    Last edited by a moderator: May 30, 2020
    #17     May 30, 2020
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  8. ZBZB

    ZBZB

    Google, there has been saturation coverage of the increase in accounts and trading activity.
     
    #18     May 30, 2020
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  9. guru

    guru

    I think you may be making wrong assumptions. I posted recent IB's numbers that show the recent growth of their client accounts, equity, and trades:
    https://www.elitetrader.com/et/threads/interactive-brokers-statistics-for-2020.344719/

    And from their press release:
    "Ending client equity of $179.8 billion, 19% higher than prior year and 12% higher than prior month."

    IB actually never seemed more excited about growing so quickly. Someone mentioned 30% growth of some of their metrics in another post.
     
    #19     May 30, 2020
  10. virtusa

    virtusa


    If you only know how to drive a car slowly, drive slowly (investor).
    If however you know how to drive a car fast, drive fast (trader).

    Only problem is that almost everybody thinks he can drive fast, and when reality hits, they understand they should have driven slowly.
     
    #20     May 30, 2020
    Nobert likes this.