Security Firm Operation

Imagine you are a consultant who is assessing the operations of a securities firm. Address the following issues:

The securities firm relies heavily on full-service brokerage commissions. In your opinion, is the firm's heavy reliance on these commissions risky? Explain your answer.

If this firm attempts to enter the underwriting business, discuss whether this would be an easy or difficult transition.

In recent years, the stock market volume has increased substantially, and this securities firm has performed very well. In the future, however, many institutional and individual investors may invest in indexes rather than in individual stocks. Discuss how this would affect the securities firm.