Neobrokers offer inexpensive value trading, but demand rebates from their trading partners for forwarding customer orders.
(Photo: Trade Republic)
Brussels, Frankfurt A controversial fee model that is common with online brokers could be banned in the future. This emerges from a draft by the EU Commission that is available to the Handelsblatt.
Above all, fast-growing start-ups such as the German neobroker Trade Republic and Scalable Capital offer investors inexpensive value trading, but receive reimbursements from their trading partners for forwarding customer orders. This remuneration practice, called Payment for Order Flow (PFOF), will soon no longer be allowed, according to the draft.
The plans for the revision of the European Financial Market Regulation also provide for price data on stocks, bonds and other securities to be more easily comparable across Europe. For this purpose, the stock exchanges in the European Union are to provide data on trading transactions for a Europe-wide comparison register.
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