Investment Firms Decreased in the US in 2019

The total number of registered representatives in the United States has decreased slightly.

FINRA, the Financial Industry Regulatory Authority, released its most recent industry snapshot.

In 2019, there were 624,674 registered representatives in the US, this was a slight decrease from 629.529 in 2018.

The number is down from 639,448 in 2015.

Primarily, registered representatives work at large firms, which FINRA defined as a firm with 500 or more registered representatives.

FINRA found that 519,738 registered representatives work at large firms; this represents 82% of all registered representatives in the US in 2019.

Medium sized firms, which are those of 151-499 registered representatives accounted for 53,763 more registered representatives, or 8% of the total.

Small firms, those with one hundred and fifty and less registered representatives, accounted for 64,168 registered representatives, or ten percent of all registered representatives.

Those numbers are largely unchanged since 2015.

In 2015, large, medium, and small firms accounted for 81%, 8%, and 11% of all the registered representatives in the US.

The total number of investment firms has also decreased.

There were 3.943 firms in the US in 2015, but that number decreased to 3,517 firms in 2019.

The firms remain clustered primarily in three states: New York, New Jersey, and Connecticut.

In 2019, there were 1,303 firms in those three states while the other forty-seven states had 2,214 firms.

Meanwhile, firms showed more profit in 2019.

Total profits for all registered firms in 2019 was $4,392,077,000,000 and that number grew from 2,260,099,000,000 in 2015.

Advertising filings were decreased markedly in 2019.

FINRA rule 2210, “broker-dealers’ communications with the public, including communications with retail and institutional investors. The rule provides standards for the content, approval, recordkeeping and filing of communications with FINRA. FINRA’s Advertising Regulation Department reviews firms’ advertisements and other communications with the public to ensure they are fair, balanced, not misleading and comply with the standards of the SEC, MSRB, SIPC, and FINRA advertising rules,” according to the FINRA snapshot.

As such, FINRA monitors the amount of advertising.

In 2015, firms submitted 98,166 advertising filings while in 2019 that number decreased to 67,571.

FINRA noted that this does not necessarily mean that advertising was done in total.

“FINRA rules do not require all communications to be filed, and the figures presented below therefore represent only a segment of such communication,” FINRA noted further.

The web appears to be where much of the marketing is going; FINRA found that of the 67,571 total advertising filings, 25,578 were for web related marketing material.

FINRA is a self-regulatory organization over the investment industry. It formed in 2007 when the regulatory arms of the NYSE and the NASD merged.