Preliminary 4Q17 Global Cost Review

Highlights from the 4Q17 preliminary Global Cost Review

Fourth-quarter trading costs in 2017 remained relatively consistent with the third quarter (averaging 32.7bps), with slight increases across small-, mid- and large-cap names globally. Even so, costs are up 13% from the all-time lows we saw in the second quarter.

  • US: US costs were stable from 3Q2017, with minor cost decreases in large- and mid-cap names. More notable was the 4.6% net outflow from the US into global markets. Japan, emerging Europe, UK and Latin America recorded the largest increases.   
  • CAN: Canada saw outflows for the first time since 1Q2014 and the lowest costs since 2Q2014. Costs decreased across market caps, especially for small-cap names, which dropped by 57%.
  • Emerging markets: Costs were the highest we have seen since 3Q2016, driven by cost increases in large- and mid-cap names.
  • EU: Overall, costs were on the rise and can be attributed to a 13% increase in implementation shortfall costs for large-cap stocks.
  • APAC: Costs rose 14.5% to 40.9bps. The increases were seen in every country, with the biggest increases occurring in Hong Kong and New Zealand.

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