| June 7 2001 |  |
Media Release
Most investors would switch brokers if they had access to better "qualitative" services - in particular research, customer care and niche products, according to a new study by on-line investment site tradingroom.com.au.
TradingRoom Ltd Pty, which is backed by Fairfax's f2 Interactive Network and Macquarie Bank, surveyed 1000 people and asked what factors would make investors switch brokers.
High quality information to help people make decisions about shares and managed funds was the single most desirable qualitative factor a broking service can provide, according to the poll conducted in April this year.
Some 80% of all the people polled had accounts with online or offline brokers, indicating that people sampled for the TradingRoom study -drawn from f2 Network users - tend to be relatively active as retail investors.
A wider survey of f2 users conducted at around the same time showed that some 60% of this group have $50,000 or more in super and non-super investments. Of this higher net worth category, two thirds or more had portfolios totalling over $100,000.
Ms Lyn Cobley, Chief Executive Officer of TradingRoom Pty Ltd, said: "Our study showed that fees charged for share trading were surprisingly unimportant compared to factors relating to delivery of better investment information, customer service and product development."
Two out of three people did not have price uppermost in their minds, and within this group one in every four investors said "better research" was the single qualitative factor most likely to make them change brokers.
"We suspect that access to better research and other key qualitative features are actually even more important in this market place and would run a close second in the minds of those respondents (33%) who named fees as the single most important criteria for switching brokers," said Ms Cobley.
Since the new tradingroom.com.au was launched in April, it has signed up some 25,000 members attracted by a reward fee structure and, in particular, its unique combination of the latest news, broker research and an extensive library of investment reports.
"Our survey also shows that other important factors for users of broking services is the desire for better client service and "product development" - which includes niche and sophisticated investment products such as tax-efficient investments, IPOs and specialist managed funds," said Ms Cobley.
"As a result, we have already placed on the site some relevant year-end structured products and we will continue to add new offerings from a variety of providers.
"Some 60% of customers said they were 'very likely' to trade online in the next 12 months, which indicates that our target clients are not likely to be a 'dormant' group when it comes to on-line investing.
"While one in three people said their average trades were in the $5000 to $10,000 range, one in three also said they intended to be quite active in the next 12 months, expecting to trade more than 16 times in the coming year.
"Some of these people still need to make the migration to online investing - so there is a sizeable potential market among both existing and potential users of on-line financial services who want news, analysis and other quality information as well as the ability to transact."
TradingRoom's information is largely provided by Fairfax on-line business publications such as the Australian Financial Review, The Age, BRW and Personal Investor.
Clients can also access daily and archived Macquarie's equities and economics research while the Dow Jones Newswires provides around-the-clock news and analysis from a wide range of Australian and international news sources and brokers.
Ms Cobley said: "Until now, Australian investors have been obliged to visit several web sites to gather information and execute investment decisions on-line.
"By contrast, tradingroom.com.au is a flexible, one-stop financial services store and we are confident consumers will see the tremendous benefits of our up-to-the minute news and research database compared to what they can access from other off-line and on-line brokers."
Other features of the recently relaunched f2 tradingroom.com.au include access to over 400 managed fund and superannuation offerings from more than 20 fund managers; margin lending with access to over 200 shares and 200 managed funds and the Macquarie Online Cash Trust.
All existing members of TradingRoom and visitors to the new site are offered a 30-day free trial. This provides complimentary access to a selection of features and benefits usually reserved exclusively for TradingRoom Clients.
For further information please contact:
Lyn Cobley, Chief Executive, TradingRoom Pty Ltd: 02 8596 4605
Laura Veltman, Media Liaison, TradingRoom Pty Ltd: 0414 668 970; 02 9958 4487
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