Schwab: Forge Global Acquisition Drives Firm Further Into Private Markets

Key Morningstar Metrics for Charles Schwab

• Fair Value Estimate: $109.00
• Morningstar Rating: ★★★★
• Morningstar Economic Moat Rating: Wide
• Morningstar Uncertainty Rating: Medium

Charles Schwab SCHW announced the acquisition of Forge Global, a secondary market platform for privately held companies, on Nov. 6. At $660 million, the deal is relatively small, but it attests to the firm’s intent to push further into private markets as investor demand continues growing.

Why it matters: Schwab’s push into private markets is a natural evolution of its brokerage and wealth management platform. The ability to transact in private company shares could help the firm better cater to productive registered investment advisors with high-net-worth clients who are increasing their exposure to the asset class.

• By our estimates, high-net-worth individuals hold about 16% of their portfolios in alternative assets—roughly 900 basis points behind institutional investors. We envision a future in which 20%-25% of portfolio allocations to alternatives are commonplace for HNW investors.
• As the appetite for alternative assets expands, it is increasingly crucial that registered investment advisor custodians like Schwab develop capabilities that can provide product access and custody services, which will in turn allow them to continue to attract productive RIAs and drive organic net asset growth.

The bottom line: Given the scale of the deal, and despite a hefty premium (Forge Global shares were up nearly 70% during intraday trading), we don’t plan to change our $109 per share fair value estimate for wide-moat Schwab. The $660 million deal represents just 0.4% of Schwab’s $170 billion intraday market cap.

• Still, we appreciate the strategic merit of the transaction, which follows the announcement of the anticipated launch of the firm’s spot trading and custody services for two popular cryptocurrencies, bitcoin and ethereum, in the first half of 2026. Schwab has shown a commitment to building out whatever capabilities its clients demand in a seamless and low-cost manner, with Forge Global aligning with this trend.