Wall Street broker Tiger Global to launch A $32 service in Australia

SYDNEY, Sept 13 Reuters - Tiger Global, an online stock broker backed by tech investment giant Stakeshop Pty Ltd, announced on Monday it would launch a trading service A $32 in Australia, the country's cheapest.

1 lender Commonwealth Bank of Australia's subsidiary CommSec, the country's largest online and mobile broker, and other large competitors that have dominated the local market for years.

I don't think there's been a material change in the industry since brokerage moved digital in the late ’90s and early 2000 s, said Matt Leibowitz, Sydney-based founder and chief executive of Stakeshop. And so, 25 years later, this is a big moment. Since 2017, the company is known among a growing number of investors in Australia and New Zealand primarily as a U.S.-listed broker for commission-free retail stocks.

For this service, Stake's platform operates in US Dollars and traders are charged 0.7% on transfers between Australian and U.S. dollars.

It has over 360,000 customers, and trading on the app has grown 100 fold to more than $1 billion per month since its launch, Leibowitz said.

The brokerage for Australian-listed stocks will be owned by Magellan Financial Group, a broker-dealer 16% owned by Finclear.

Trading in shares listed on the local ASX Ltd exchange will be CHESS-sponsored, meaning that it will be under a legal person's own name, not a separate entity's name, as is commonly done by low cost brokers seeking to reduce costs.

After a commission free period until year end, Stake commissions of A $3 a trade will compare to CommSec's tiered fees of A $5 to $29.95 for each trade worth up to A $1,000 to A $25,000, respectively.

I think that this will accelerate us to the top, Leibowitz said. Perhaps we will be banging the door down if number one was the aim of these two questions. CommSec holds 5.4% market share in terms of the traded value of Australian stocks, as of 30 June 2016 according to the Commonwealth Bank's annual report. But its share of the retail brokerage market is estimated to be close to 40%, with the narrower broker opening over 550,000 client accounts in fiscal 2021.