November 7, 2016
The leading brokerage in KSA offer a plethora of services related to asset management, and investment banking in addition to brokerage services. All the brokerage firms in KSA provide online trading facility and brokerage services to trading in international markets such as other GCC markets, European and US. Saudi stock market is dominated by the top 10 brokerage firms contributing approximately 90% of the value traded. The commission charged by the brokerage firms in Saudi Arabia is set at 0.12% of the value traded by the stock exchange. Based on the value traded in 2014, the commission earned by the brokerage firms in 2014 was estimated at USD 1.29bn. The commission earned by the brokerage firms is estimated to increase at a CAGR of 2% between 2014 and 2020 to reach USD 1.46bn in 2020. The brokerage firms in KSA are dependent on the buying and selling of equities for revenue generation. Absence or miniscule presence of other products such as ETFs, mutual funds, commodities and derivatives limit the opportunity of revenue generation from these products. All brokerage firms provide research support however; further enhancing their research offering would result in increased confidence of retail and institutional investors.