Trade for Good, an innovative stockbroking platform, redefines the traditional brokerage model by sharing half of its brokerage fees with partner charities chosen by investors.
Most broking firms have their stockbrokers return 50 to 70 cents of every dollar of brokerage to the house, and with retail online trading, like CommSec, everything goes to the bottom line of the business.
Unlike typical stockbrokers who retain a significant portion of brokerage fees, Trade for Good has turned this model on its head, ensuring that a portion of every trade supports charitable causes. Investors receive receipts directly from the charities, enabling tax claims on their contributions.
Co-founded by former stockbrokers Alistair Warren and Ben Galamaga, Trade for Good emerged from their dissatisfaction with the finance industry's lack of social responsibility.
The platform aims to support a range of causes, including human welfare, animal protection and environmental conservation. It charges industry standard brokerage that’s a little bit cheaper than the likes of CommSec and NABTrade.
Disrupting the industry
"We still have to make money to keep the business open, but we’re also going to disrupt this industry and build something that makes a massive difference," said Warren.
Using cutting-edge technology, Trade for Good caters to a diverse investor base, from individual investors to family offices and institutional clients. The platform has partnered with progressive firms, integrating with the Netwealth advisor platform and gaining support from Pitcher Partners’ wealth management division, which manages in the vicinity of A$5 billion.
While primarily focused on institutional clients, Trade for Good’s retail segment is expanding. However, Warren acknowledges the challenges of competing in the retail market, particularly with the rise of low-cost trading platforms like Superhero and Stake. Instead, Trade for Good prioritises sustainable charitable contributions over becoming the cheapest option.
Striving to make a positive difference
Trade for Good currently collaborates with 15 charities, aiming to support no more than 30. This selective approach ensures that each charity receives substantial funding to make a significant impact, rather than spreading resources thinly across numerous organisations.
"We don’t strive to be the biggest; we strive to make a positive difference in the world, particularly in Australia, by inspiring people in the finance industry to think of the community around them and how they can make positive change through sustainable Investment," Warren added.