The Wealth Management Industry Shows Promising Results

The third quarter has been an encouraging period for all types of firm in the wealth management arena, as reflected by strong business performance across the board.

In the wake of high levels of growth in the FTSE (i.e. a 14.7% quarter on quarter increase in the FTSE APCIMS Balanced Index), wealth managers have witnessed much needed improvements in their investment management fee income, up 12% compared to Q2 2009. With staff numbers marginally falling by 0.5% and reported improvements in productivity, costs have been kept under control, marginally rising by 1.9%. Therefore pre-tax profits in both absolute and percentage terms have grown significantly. 

As for the Execution Only Stockbrokers, it continues to be a very exciting time to be involved in this industry. Trading volumes have shown no signs of slowing from what was a very good second quarter. In fact, in total, trades through execution only stockbrokers increased by 1.2% quarter on quarter, setting new records if you were to exclude the peak quarter of the dot-com boom. Trades on the UK cash markets continues to be the investment of choice, increasing by 3.3% to 3.38 million in Q3 2009, allowing execution only stockbrokers to thrive on the additional commissions, up 2.5% quarter on quarter to £52.2m. A common viewed amongst execution only firms is that investors are moving out of lowly remunerated cash savings accounts and investing in the market in search of higher returns.