SANFORD Securities is running scared in light of the online discount broking industry price war.
The battle began in earnest when Commonwealth Securities dropped its online broking charge to $19.95, a significant fall from the industry average of $29.95.
Westpac responded by dropping its rate to $15.00. That was matched by ComSec. Lend Lease’s Your Prosperity now offers rates as low as $9.90.
Considering the Australian Stock Exchange only charges brokers $5 per transaction, it is feasible online trading may soon drop further.
Sanford Securities still trades at $28.95 or 0.1 per cent of the value of the trade.
Sanford Securities corporate communications manager Claire Bremner said the lower rates being offered by competitors were bound by conditions.
‘You often have to pay a monthly fee or become a managed fund member so low rates are really an incentive to get you to do that,” Ms Bremner said.
“Our volumes haven’t reflected a drop in business as a result of the competition but we have had a lot of questions from our members.
“Our customers trade on average six times as much as Commonwealth Securities.
“We have a close dialogue with them and initial feedback shows they want to stay with us.
“We will be establishing a loyalty program in about a month.
“I can’t tell you much about it but it will be very sexy,” she said.
