Two trends will redefine securities lending this year
Newsletter - March, 2021
A wave of IPOs has reinvigorated capital markets
FACT: 2020/21 has seen an abundance of IPOs.
FACT: IPO’d stocks are usually volatile, generating a lot of trading opportunities among private and institutional investors.
FACT: lending rates on IPO’d stock generate lucrative revenues, a healthy additional income for long-term investors.
FACT: institutional investors are already benefiting from these opportunities.
FACT: many private investors are unable to capitalise on them.
It’s time to level the playing field.
Charles Schwab made $334mn last year from securities lending
Online brokers are riding two massive waves of change: the wave of new IPOs AND a groundswell of private investor participation.
After acquiring TD Ameritrade last year, Charles Schwab’s results speak for themselves. Securities lending is transforming their business.
“The surge of retail trading activity, and the subsequent flood of lending revenue, has fundamentally changed Charles Schwab’s revenue model, according to chief financial officer Peter Crawford.”
Now, wealth managers are following Schwab's lead
But instead of hiring a team, licencing the software and spending years building a line of business, they’re turning to Sharegain.
It’s no surprise then that we’ve just been named the most promising trading and investing fintech company in 2021 by Citi Accelerator.
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