Direct Answer
17 SEC filers are classified under the Standard Industrial Classification code that describes the investment banking & brokerage industry, and their latest annual reports show $261.8 billion of combined revenue and a median operating margin of 12.9%. Investors should still evaluate its revenue model, industry-specific KPIs, valuation framework and the risks that can change the group's economics.
Industry Overview
Investment banking and brokerage firms advise on mergers, underwrite securities, trade for clients and provide brokerage services. Results swing with deal volume, market activity and trading conditions. The first numbers to compare across companies here are advisory and underwriting revenue, trading revenue and return on equity.
Key Industry Metrics
- Advisory and underwriting revenue: Fees from merger advice and from underwriting stock and bond offerings. They swing with deal activity and market confidence.
- Trading revenue: Income from market-making, client trades and positions. It varies with volatility and volume, and can be strong in turbulent markets.
- Return on equity: Net income as a share of shareholders' equity. It shows profitability relative to capital, and swings with the cycle.
- Compensation ratio: Pay and bonuses as a share of revenue. It is the largest cost, and shows how much of revenue is shared with staff before shareholders.
- Backlog: Mandates signed but not yet completed. It gives a view of near-term fees, though deals can be delayed or cancelled.
Primary Macro Drivers
- Mergers and acquisitions activity: Companies buy and sell when confidence and financing are good, so deal volume lifts advisory revenue and backlog.
- Equity and debt issuance: Stock and bond sales for companies and governments depend on markets, so issuance activity moves underwriting revenue.
- Market volatility: Trading revenue and client activity rise with price swings, though swings can also cause losses on positions.
- Interest rates: Rates affect financing cost, deal valuations and interest income, so they shape both deal flow and margins.
Major Risks
- Deal slowdowns: Deal and issuance fees dry up when markets weaken, while costs remain. Watch advisory and underwriting revenue and backlog.
- Trading losses: Positions can lose value quickly in volatile or illiquid markets. Watch trading revenue volatility and value-at-risk disclosures.
- Compensation costs: Pay is a large share of costs and can stay high when revenue falls. Watch the compensation ratio and margin.
- Regulatory capital: Higher capital and liquidity rules limit leverage and balance sheet use. Watch capital ratios and return on equity.
Industry Characteristics
| Characteristic | Profile |
|---|---|
| Cyclicality | Cyclical |
| Capital Intensity | High |
| Regulatory Intensity | High |
| Industry Maturity | Mature |
| Geographic Importance | U.S. / Global |
Investment Banking & Brokerage Filers in the SEC Record
17 companies with annual reports in the dataset are classified by the SEC in the Standard Industrial Classification code 6211. Their latest fiscal years end in 2025, and together they reported $261.8 billion of revenue. Median revenue growth over the prior year was 19.6%. Median operating margin was 12.9% and median net margin 10.2%. Median total liabilities were 81% of total assets, and 14 of 17 reported a profit in their latest year.
| Company | Revenue | Growth | Operating margin | Net margin | Year |
|---|---|---|---|---|---|
| Morgan Stanley | $70.6 billion | 14.4% | n/a | 23.9% | FY 2025 |
| Galaxy Digital Inc. | $60.4 billion | 41.8% | n/a | -0.4% | FY 2025 |
| Goldman Sachs Group Inc | $58.3 billion | 8.9% | n/a | 29.5% | FY 2025 |
| Blackrock, Inc. | $24.2 billion | 89.3% | 29.1% | 22.9% | FY 2025 |
| Raymond James Financial Inc | $15.9 billion | 6.6% | n/a | 13.4% | FY 2025 |
| Jefferies Financial Group Inc. | $10.8 billion | 2.9% | n/a | 6.3% | FY 2025 |
| Stifel Financial Corp | $6.3 billion | 6.7% | n/a | 10.2% | FY 2025 |
| Robinhood Markets, Inc. | $4.5 billion | 51.6% | n/a | 42.1% | FY 2025 |
The 8 largest of 17 by revenue. Source: each company's own annual report as filed with the SEC (XBRL data), figures in U.S. dollars. A company's SIC code reflects its main business as the SEC records it, so it can differ from how an index provider or analyst classifies the company, and a diversified group appears under only one code.
Where to Go Next
The Investment Banking & Brokerage guide describes how the industry earns money, what to measure and what can go wrong. To see how it compares, read the neighbouring industries in the same sector, then apply the same checks to a specific company.
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Frequently Asked Questions
What are the main KPIs for the Investment Banking & Brokerage industry?
Key performance indicators for the Investment Banking & Brokerage industry include: Advisory and underwriting revenue, Trading revenue, Return on equity, Compensation ratio, Backlog. Which matter most depends on the company's model, so compare them across several companies rather than relying on one.
How cyclical is the Investment Banking & Brokerage industry?
The Investment Banking & Brokerage industry is cyclical, meaning its revenues and earnings tend to expand during economic expansions and contract during downturns. Investors should monitor leading economic indicators and interest rate trends when evaluating timing.
What are the biggest risks in the Investment Banking & Brokerage industry?
The primary risks for Investment Banking & Brokerage companies include: Deal slowdowns, Trading losses, Compensation costs, Regulatory capital. Investors should assess each company's exposure to these factors and its track record of navigating them.