The brokerage distribution channels is continuing to evolve. Struggling Morgan Stanley
, in a bid to get back on track with its rivals, plans to stop bringing on new brokers and rely solely on stealing veterans from other firms, reports the New York Post
The move is an attempt to cut out broker-training costs at the firm and up the firm's Individual Investor group profitability, reports the Post.
According to the Post, Morgan's pretax profit margins are 12 percent, compared to Smith Barney with 21 percent, Merrill Lynch with 19 percent and UBS with 15 percent.
The Post cited a broker headhunter who opined that Morgan Stanley will eventually reduce its now 10,000 broker force to 3,000, focused solely on the high-end of the middle class and the wealthy. "My guts tell me that [Morgan] will have to cut [the Individual Investor Group] down to 3,000 brokers over a period of time," Rick Peterson of recruiting firm Rick Peterson & Associates, told the Post.
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