Market Overly Optimistic on Netwealth's Volume Growth and Margin Expansion Ability

Netwealth provides investment administration software as a service. It includes portfolio administration, investment management tools, and investment and managed account services. The firm’s administrative capabilities encompass custodial and noncustodial assets. Netwealth’s product integrates with external software, allowing it to facilitate more functions and streamline the implementation of financial advice to clients under a single—its own—platform. While Netwealth services all cohorts, it is particularly successful catering to more affluent clients who generate more revenue because of greater asset values and trading activity. This supports Netwealth's higher operating leverage relative to its peers.