Bank Client Loyalty Fades as Robots Spur Shifts in Stock Volumes

Banks operating in North America are losing customer loyalty in equities, and robots may be partly to blame.

Buy-side clients are spreading their business around. Equity-trading volumes moved among individual broker-dealers by a median 36 percent in 2017 to 2018, up from 22 percent the period four years earlier, according to a survey of almost 300 traders released March 12 by consultant Greenwich Associates. The shift comes as asset managers use increasingly sophisticated tools to assess the performance of trading algorithms offered by banks.

“Loyalty is declining and it’s in a very measurable way,” said Ken Monahan, a senior analyst ...