Retail investors have used 2016's market volatility to seek opportunities rather than retreating from the market, Bell Direct chief executive Arnie Selvarajah says. 

Mr Selvarajah, who heads Bell's online trading arm, is optimistic about 2016 despite market ructions, but says long periods of volatility will hurt sentiment.

"Our clients are really looking for opportunities when the market pulls back rather than being fearful," he said. "It's not all bad, but continued volatility will see clients go to the sidelines."

Bell Direct is ​56.6 per cent-owned by Bell Financial Group. The online trading unit posted an unaudited profit before tax of $1.2 million for 2015, up 200 per cent from the previous year. It broke even in 2013. 

Almost two years ago, Bell Direct entered an agreement with Macquarie Group to provide a trading platform for its ­banking and financial services group. The three-year agreement was for a white-label offering similar to a separate arrangement with HSBC Australia.

Mr Selvarajah said the "full impact" of the Macquarie deal would come through in 2016, and he noted the company's proprietary systems had scope to add further such arrangements.

"We have the capacity," he said. "We think we can do 10 times the volume we are currently doing." 

Mr Selvarajah also sees more growth in online broking, stemming from a shift by financial planners and advisers away from institutionally owned groups.

The online broking sector is ­dominated in the market share stakes by the Commonwealth Bank 's CommSec. But players such as Bell, which won the AFR Smart Investor best online broker award for a third year in 2015, and the other big banks are challenging the incumbent.  

However, despite ranking well, Bell Direct does not get access to research from its parent's partnership with Citigroup. This is a topic Mr Selvarajah said was being discussed. 

While he is mindful of the threat of disruption and new technologies, he also noted that many start-ups did not yet have distribution to draw on.  

"There is a lot of stuff being talked about but it is a along way from execution."
 

The article was written by Joyce Moullakis and first published on the AFR: www.afr.com