November 9, 7:44 am
Over the past six years, more than 50 million people have turned to low-cost neobroker apps, which have given them access to a wide range of financial products, from stocks and bonds to mutual funds and ETFs, while cutting down trading costs. Today, the total value of assets under the management of these digital brokers is $463bn, four times more than just six years ago, and the entire market is expected to continue growing in the following years.
According to data presented by AltIndex.com, the total value of assets under the management of neobrokers is expected to jump by 30% and hit $606bn by 2027.
The digital onboarding of investors searching for an easier and quicker way to build their portfolios has helped neobrokers to spring up like mushrooms in recent years. Their user-friendly interfaces, reduced trading costs, and the ability to participate in the stock market with only a small amount of money have drawn millions of users to the market. Neobrokers enabled trading on the go, anywhere, anytime, and retail investors loved it.
According to a Statista survey, the total value of assets under the management of neobrokers amounted to $101.1bn in 2017. A year later, this figure jumped by 62% to $164.4bn. Statistics show 2019, 2020, and 2021 all saw double-digit growth rates, causing the total value of assets to double and hit $395bn. However, 2022, the worst year for the stock market since the last recession, stopped this impressive growth, with the assets under the management of neobrokers rising by only 5% YoY to $415bn.
Although the annual growth rate recovered to 11% in 2023, that is still deep below the figures seen in the past six years. Statista expects the annual growth rates to continue cooling in the following years and drop to only 5% in 2027. But despite that, the total value of assets under the management of neobrokers will jump to over $606bn, showing a sixfold increase in ten years.
Statista also expects more than 15 million people to start using neobrokers in the next four years, despite the market growth slowing down. In 2023, more than 73 million people have used the conveniences of these digital brokers. By 2027, this number will jump to 88 million.
In global comparison, the United States is, without a doubt, the number-one market for neobrokers. More than half of the total value of assets under the management of neobrokers in 2023, or $238bn, comes from the United States, while every fourth trader using these digital brokers is an American.
Statista expects the US market to grow by another 27% and hit a $303bn value in the next four years, with nearly 20 million Americans using neobrokers by 2027.
AltIndex revolutionizes investing with advanced alternative data analytics, smart insights, and stock alerts, presented in an easy-to-use dashboard powered by comprehensive company data from across the internet.
The information provided by AltIndex is solely for informational purposes and not a substitute for professional financial advice. Investing in financial markets carries inherent risks, and past performance doesn't guarantee future results. It's crucial to do your research, consult with financial experts, and align your financial objectives and risk tolerance before investing. AltIndex creators and operators are not liable for any financial losses incurred from using this information. Users should exercise caution, seek professional advice, and be prepared for the risks involved in trading and investing in financial assets, only investing what they can afford to lose. The information in this application, derived from publicly available data, is believed to be reliable but may not always be accurate or current. Users should verify information independently and not solely rely on this application for financial decisions. By using AltIndex, you acknowledge that it doesn't offer financial advice and agree to consult a qualified financial advisor before making investment decisions.
© 2023 AltIndex. All rights reserved.
Trending Stocks on WallStreetBets
Trending Stocks on Reddit
Top Stock Performers Today
Bottom Stock Performers Today
Best Airlines Stocks
Best Bank Stocks
Best Semiconductor Stocks
Best Energy Stocks
Best Fintech Stocks
Best Robotics Stocks
Best Insurance Stocks