North American financial advisers seen discounting less

TORONTO (Reuters) - Discounting among North American financial advisers is decreasing as revenue and equity-trading volumes rise, pointing to more profitability in the industry, brokerage software firm PriceMetrix said on Wednesday.

Looking at data from more than 15,000 U.S. and Canadian financial advisers, the Toronto-based firm said average production, or revenue from fees and commissions, was up 12 percent in May from a year earlier, while the volume of trades and the number of trades at full price both rose by 2 percent.

The advisers completed an average of 33 percent of equity trades at full price in May.

PriceMetrix, which advises financial advisers on practice management, said there are four things firms should do to reduce discounting and improve profitability:

- Measure full price performance on transactional and fee business

- Benchmark price performance precisely to comparable firms and identify performance gaps

- Inform advisers with market price information on both fee and transactional business

- Balance discount penalty mechanisms with rewards for pricing effectively

(Reporting by John McCrank; editing by Peter Galloway)