Nissan Century Securities, the Japan-based brokerage, has started offering Chinese stocks to boost revenue as domestic shares lag behind global markets, reported Bloomberg. Increasing competition that is forcing firms to reduce brokerage commissions also prompted the firm to take the decision.
Reportedly, average daily trading on the first section at Tokyo Stock Exchange declined 21% this fiscal year through October. On the other hand, Nikkei 225 Stock Average surged 13% and Hong Kong’s Hang Seng Index soared 45% when valued in yen.
Japan’s deregulation of brokerage transactions a decade ago as well as the growth in internet securities trading has increased competition and led to lower commissions. According to Tokyo Stock Exchange data, average fees for the 121 securities companies listed on the Tokyo Stock Exchange fell from 0.38% in March 1998 to 0.07% in March this year.
Nissan Century’s commission income for March was JPY2.4 billion, of which 70 to 80% was from Japanese shares and 20 to 30% from mutual funds. Nissan Century aims to increase revenue from trading Chinese shares to the same level as mutual funds.
Takehiko Nuki, president of Nissan Century, a subsidiary of Unicom Group Holdings, said: “Yields from Japanese equities are declining and the market here is too localized. Clients have high expectations for Chinese stocks,” reported the news agency.
