Retail Investors Want Insights and Tools to Trade Like the Pros

One of the effects of the COVID-19 pandemic has been a significant rise in the number of new traders, especially among the Millennial age category. We’ve discussed what brokers and issuers can do to educate and engage new traders in a previous blog post, so it was interesting to see the results of a survey asking retail investors about the products and services they most want to see from their broker.

The top three answers were: better news and insights, data visualizations and trading connectivity. These priorities reflect the increasing sophistication of [retail] clients as traders, according to David Aferiat, managing principal and co-founder of Trade-Ideas, the company that sponsored the survey, and Bill Hortz, a business consultant and Dean of the Institute for Innovation Development, in an article published by Nasdaq.

Third-party utilities with good APIs boost client numbers

More than 80 percent of survey respondents said they found value in third-party tools, beyond those provided directly by their broker. Such a high figure underscores the benefit of integrating independent service and utility providers into brokerage platforms to support client acquisition and retention. Crucial for success is selecting providers with robust application program interfaces (APIs) to ensure seamless integration.

Less than half of survey respondents were satisfied with the insights and research provided by their broker, adding more weight to the argument for using third-party solutions to fill in service gaps. Aferiat and Hortz point out that success will belong to brokers who retain and attract investors with the tools they need, delivered in the way they want.

The findings of the survey align with Mediant’s approach to shareholder engagement. We provide tools and technology that enable brokers to meet shareholders “where they are” and provide a frictionless experience. Our solutions include APIs that enable in-app, custom shareholder experiences.

One example of this in practice is how we work with brokers to drive shareholder voting. Brokers use in-app push notifications to issue reminders to investors to view their documents; we make the voting process quick and simple with options to vote that also include using email, text message or an Alexa device. All of this is seamlessly integrated into brokers’ online services and apps.

Mediant’s responsive technology expands opportunities for interacting with investors, as well as helping brokers stay ahead of financial, regulatory and shareholder change.

For more information about how Mediant is helping brokers meet the demands of a changing market, contact us.