The material on this site is for financial institutions, professional investors and their professional advisers. It is for information only. Please read our Terms & Conditions, Privacy Policy and Cookies before using this site. Please see our Subscription Terms and Conditions.


All material subject to strictly enforced copyright laws. © 2021 Euromoney, a part of the Euromoney Institutional Investor PLC.
Capital Markets

Breakingviews: Return of the stock jobber

Big Bang is coming undone. The major investment banks are starting to unpick the full-service equity operations they have built up over the past two decades.

Few have yet made their intentions explicit. But it is possible to get a sense of where things are headed from HSBC's recent announcement about its equity business. The international banking group said it was scaling back agency brokerage in order to focus on the trading side of the business. It is not alone in heading down this route.

It isn't clear what will take the place of the full-service big players. But the market's new structure might bear more than a passing resemblance to the one the City abandoned in 1986.

Before Big Bang, the stock exchange operated on what was called a single-capacity system. That separated traders – known as "jobbers", who provided liquidity to the market – from "brokers", who bought and sold stocks on behalf of investors.

This system was swept away at Big Bang in favour of dual capacity, which stuck everything under one roof. The argument was that the dual system offered sufficient economies of scale to compensate for the loss of transparency.

You have reached premium content. Please log in to continue reading.

Read beyond the headlines with Euromoney

For over 50 years, our readers have looked to Euromoney to stay informed about the issues that matter in the international banking and financial markets. Find out more about our different levels of access below.

SUBSCRIBE ONLINE TODAY

Unlimited access to Euromoney.com and Asiamoney.com

Expert comment, long reads and in-depth analysis interviews with senior finance professionals

Access the results of our market-leading annual surveys across core financial services

Access the results of our annual awards, including the world-renowned Awards for Excellence

Your print copy of Euromoney magazine delivered monthly

£73.75 per month

Billed Annually

FREE 7 DAY TRIAL

Unlimited access to Euromoney.com and Asiamoney.com, including our top stories, long reads, expert analysis, and the results of our annual surveys and awards

Sign up to any of our newsletters, curated by our editors

LOGIN NOW

Already a user?

We use cookies to provide a personalized site experience.
By continuing to use & browse the site you agree to our Privacy Policy.
I agree