Speaking to ifa, Iress chief executive Andrew Walsh noted that ASIC has been using the same language to describe its expectations concerning retail stockbrokers as it has concerning financial planners.
In addition, the bookkeeping and record keeping requirements of stockbrokers are very similar to those of planners, Mr Walsh said.
“It’s not okay for stockbrokers to just record they have put an order on for a client, and then to check their risk profile in real time,” he said. “It’s much more [important] to align that to their objectives and what else is in their portfolio, as well as prior advice [received].”
Stockbroking businesses are increasingly diversifying into wealth management, he added.
“From a retail broking side, they’re talking much more about the client than the account,” Mr Walsh said. “They’re talking about how to access other participants in that family, not just the client that they have.”
Iress group executive for financial markets, Matt Rady, said the biggest challenge for stockbrokers is remuneration.
“They would love to see their 50 per cent payout commission models evolve, but they can’t afford to put their existing revenue at risk,” Mr Rady said.
