Schedule C - Brokerage Accounts

[austin3515]

Audited plan has brokerage accounts for some of its employees (the rest are at a daily val platform). I assume there is some level of revenue sharing going on between the funds and brokerages. What are other people doing about this?

[MoJo]

Great question, and while I don't have the answer, I can assure you that the SDB business can be extremely enriching (to the provider). I used to work for a large bundled provider (discount broker parent) and the revenue assumed from SDB's for pricing purposes was between 100 and 200 bps - and that certainly wasn't from trading fees. Approximately 1/3 of the brokerage account assets were in cash and cash equivalents, which were cash cows for the firm, plus revenue from any mutual funds held in the brokerage accounts would be enough to make a fiduciary blush (on the retail (brokerage) side, pay to play on the platform is extremely lucrative).