Demise of the stockbroking industry is imminent
With the trading volume petering off other than non commission generating computer trades, broking houses are finding it tough going to cover their overheads. Remisiers too are sleeping on their jobs literary with hardly a phone call daily. Many would have qualified as low wage earners going forward and should be entitled to workfare subsidies.
Someone would have to bear the operating costs of brokerages and pressure has been put on remisiers to push their clients to trade more or they would have to cough up the difference in operating cost. Some houses are dangling the carrot to induce sleeping clients to start trading.
All these are meant well measures but failing to understand the real cause of the dying market and are futile efforts, grasping at shadows. Not many investors have much money left to feed the big funds and their gambling computers. When entering the market is a certain loss, who would want to trade even if it is for free? Unless the real cause of the systemic flaws in the market are recognized and removed, the stock market will collapse in increasing speed.
Within a matter of months there could be an exodus of remisiers out of the industry. More would be applying for taxi driving licence as the last resort. Employees of brokerages are bracing up for the red letters as retrenchment is on the card when revenue fails to match operating cost.
How could a healthy and lucrative industry reach such a pathetic plight? Actually the writings were on the wall several years back when all the changes were introduced into the market. Anyone in the industry would know what is happening but no one would want to do anything, and the slide to the bottom and self destruct is only a matter of time.