Charles Schwab, the NYSE-listed American wealth manager and brokerage, has re-established a presence in the Australian market, and is gearing up to help “self-directed” Australian investors to easily and cost-effectively access the US markets.
Schwab made the announcement last week, which it noted followed on from its acquisition of Chicago-based US brokerage services provider optionsXpress in 2011.
Charles Schwab Australia Pty Ltd, a subsidiary of The Charles Schwab Corporation, has offices in Frenchs Forest, a northern suburb of Sydney, according to its website.
The announcement comes just weeks after Schwab announced that it had opened an office in downtown Singapore, which it said was also aimed at helping investors there and elsewhere in Asia to invest more easily in the US, which it describes as “the most diversified, liquid market in the world”.
Schwab has an office in Sydney previously, but closed it, and left the Australian market, in 2000, in response to what the company now says was “a range of market circumstances at that time”.
Now, though, it describes Australia as “a compelling market, with the ongoing growth of SMSFs [self-managed super funds] demonstrating the clear demand and need for easy, low-cost access to US markets”.
“The combination of this demand and through the optionsXpress integration, we have a clear strategy and approach to serve the market and are confident about our future in this important region,” it says.
‘Alternative’ to current options
JP Drysdale, who is heading up the new Down Under Schwab outpost as managing director, said Charles Schwab Australia presents Australian investors with an alternative to the expensive investment options they currently must choose from.
“At Charles Schwab, we believe all Australians should have greater access to international investing, and in doing so, have the ability to diversify their portfolios and access opportunities beyond [Australia’s borders],” he said in a statement announcing the launch of the new operation.
“Typically, access to US markets for self-directed investors, including SMSFs, is expensive compared to the costs of transacting in the Australian market,” Drysdale added.
“However, we believe there need not be trade-offs between price and customer service.
“Our ambition is to bring cost-effective access to US markets to all Australian investors – and with the popularity and ongoing growth of self-managed super funds in Australia, we see a clear demand for that access.”
Among the US products Australian investors will be able to access through the new Charles Schwab facility, according to Drysdale, will be US-listed equities, offshore mutual funds, ETFs, fixed income products, options and futures.
Online equity trades will be priced at US$4.95 (A$6.52, £3.72) each, according to Schwab.
Founded in 1971
Charles Schwab was founded in 1971 by Charles R Schwab and is based in San Fransciso, with more than 345 offices operating around the world. It claims to hold more than 10.6 million active brokerage accounts and US$3.18trn in client assets globally.