Tiger Brokers: Early Innings in a Massive TAM? – 13x Earnings, 59% Revenue Growth
Why I Think Tiger Brokers Has Much More Room to Run
When you look at UP Fintech Holding – better known as Tiger Brokers – it’s hard not to notice the paradox. On the one hand, the company just reported record highs in revenue, profit, client assets, and funded accounts. Growth is high – very high! – international expansion is successful (so far) and paying off, and the balance sheet is cleaner than it’s been in years. On the other hand, the stock – despite a spectacular run – still trades at levels that imply a heavy dose of skepticism, arguably weighed down by lawsuits, China’s regulatory baggage, worries about peak earnings, and investor doubts about whether Tiger can ever catch up to rival Futu.
Just look at the chart below: after the post-Covid hype sent shares briefly above $30 in early 2021, the stock collapsed into obscurity, drifting around $3–4 for much of 2023 and early 2024. Most investors had written it off as another casualty of China’s shifting regulatory environment. Fast forward to today, and Tiger is trading at $12.50 – up 93% year-to-date and more than 240% over the past twelve months.
On the surface, that kind of move might scream “too late.” A stock that triples in a year rarely looks like a compelling entry point to me. But the numbers underneath tell a different story. Tiger has been posting record client growth, expanding internationally, and steadily widening its margins.
It’s a business that, in some ways, resembles Robinhood – a retail brokerage catering to the next generation of investors – but at a fraction of the valuation. Where Robinhood trades at a premium despite slowing engagement, Tiger’s profitability is accelerating, yet the market still treats it like a risky China-exposed play.
That’s the disconnect I want to explore. Has Tiger’s rally already priced in all the good news, or is this the early innings of a more sustained recovery? Is it a second-tier broker riding temporary tailwinds, or has it quietly built a foundation that could make it a long-term compounder? The answers aren’t simple, but they’re worth digging into. Because sometimes, the best opportunities hide inside the stories most investors gave up on too soon.
In this post, I go deep into Tiger Brokers – roughly 23,000 words – and cover:
The disconnect between Tiger’s recent business performance and how the market still prices the stock
A 90-second “Bam Bam Bam Bam Bam” pitch inspired by Bill Miller – what makes Tiger interesting now
An in-depth breakdown of the business model – how Tiger makes money, where the leverage lies, and how that’s changing
A close look at the core product: how differentiated it is, who it serves, and what role it plays in customers’ financial lives
A closer look at customers: demographics, account quality, retention dynamics, and why average balances matter more than headline account numbers
A detailed operating perspective based on balance sheet structure – what the numbers reveal about scalability and risk
A full-blown competitive advantage analysis: what moat (if any) exists, and whether it’s widening, shrinking, or still forming
The risk of false moats – and why great execution doesn’t automatically mean defensibility
A nuanced view of the customer base, customer acquisition costs & payback periods, retention profile, and embedded stickiness
My framework for assessing management quality – based on actions, not words – including capital allocation discipline and founder alignment
An inversion of the entire thesis – where I challenge myself to kill the idea, pressure-test assumptions, and spotlight the real downside scenarios
A wide-ranging risk analysis that doesn’t just list uncertainties but ranks their potential to break the thesis
Valuation framed simply – long-term user and asset growth, normalized margins, and why entry multiple matters less than execution
Scenario analysis: what Tiger looks like in ten years if margins converge with peers, and why consensus estimates understate earnings power
Relative valuation versus Robinhood, Webull, Futu, and IBKR
A synthesis of why I think the risk/reward setup here could be asymmetric, and what would need to happen for this to become a long-term winner
Before we dive back in, a quick note…
If you're a free subscriber, this might be a good time to consider upgrading. These deep dives are written with full transparency, high analytical depth, and zero fluff – and they’re designed to help you sharpen your own process, not just follow someone else’s opinion.
Disclaimer: I own UP Fintech shares. The analysis presented in this blog may be flawed and/or critical information may have been overlooked. The content provided should be considered an educational resource and should not be construed as individualized investment advice, nor as a recommendation to buy or sell specific securities. I may own some of the securities discussed. The stocks, funds, and assets discussed are examples only and may not be appropriate for your individual circumstances. It is the responsibility of the reader to do their own due diligence before investing in any index fund, ETF, asset, or stock mentioned or before making any sell decisions. Also double-check if the comments made are accurate. You should always consult with a financial advisor before purchasing a specific stock and making decisions regarding your portfolio.
90-Second Pitch: Bam Bam Bam Bam Bam – Why Tiger Brokers, and Why Now?
Bill Miller once said that if you can’t pitch a stock in 90 seconds, you don’t really understand it. You should be able to say: “It’s trading at X, it’s worth Y, and here are five reasons why.” Simple. Punchy. Conviction in bullet form.
So here’s my attempt – not to oversimplify, but to crystallize what makes UP Fintech (Tiger Brokers) interesting right now, after a 240% run in twelve months:
This is a misunderstood brokerage business, currently firing on all cylinders, emerging from years of regulatory uncertainty, now hitting its stride operationally and structurally mispriced relative to both its fundamentals and peers.
Here’s what I’d say in that 90-second window:
BAM: Tiger has just posted its strongest quarter in company history – record revenues, record profit, record net asset inflows. This isn’t a bounce-back; it’s an inflection.
BAM: Over 70% of new funded accounts now come from outside the Greater China area, and the international business is higher-margin, higher-ARPU, and growing faster than the legacy base (“For the first question about the regional breakdown of new funded accounts, in the second quarter, about 50% of newly funded accounts came from Singapore and Southeast Asia region, approximately 30% were from Hong Kong and the Greater China area, 15% from Australia and New Zealand market and around 5% from the U.S. market.“ – Q2 Call).
BAM: The business is scaling with operating leverage, and Tiger is closing the profitability gap to Futu quarter by quarter.
BAM: It still trades at a steep discount to Robinhood – despite better customer economics in some key markets, and a more global, asset-rich client base.
BAM: The risk profile has changed dramatically. China’s crackdown is in the rear-view mirror, the mainland business is shut, and Tiger is now building around regulated hubs in Hong Kong, Singapore, Australia, and the U.S.
So why now? Why bother writing about this stock after such a huge run? I’d say that’s atypical for me.
Because apparently, despite the rally, the market still sees the old Tiger – the China-exposed brokerage with headline risk, legal overhang, and meme-stock clients. It doesn’t see the new Tiger – a profitable, increasingly global, tech-driven platform with long-term optionality in crypto, wealth management, B2B, with margin expansion and a focus on high-quality clients (i.e. decently large account sizes; more on the importance of this metric further below in the deep dive).
That misperception creates the opportunity. Tiger is behaving like a business that deserves a higher multiple – but it’s still priced like one waiting for the other shoe to drop. The core of the bet is that fundamentals have changed faster than sentiment, and price hasn’t caught up yet.
Part 1: Understanding Tiger
What Exactly Does Tiger Sell?
At its core, Tiger is a brokerage. But that label doesn’t quite capture the full picture of what it actually sells – or how differentiated its offering has become. Tiger offers a fully digital, mobile-first investment platform aimed at retail investors, primarily outside the U.S., and increasingly outside of China.
“Regarding total client assets, net asset inflows remained robust, reaching USD 3 billion in the second quarter, over 70% of which came from retail investors.“ - Q2 Call
Become a paying subscriber to read the rest of this post and get access to all of my other research, including valuation spreadsheets, deep dives (e.g. LVMH, Edenred, Digital Ocean, or Ashtead Technologies), and powerful investing frameworks.
Annual members also get access to my private WhatsApp groups – daily discussions with like-minded investors, analysis feedback, and direct access to me.
PS: Using the app on iOS? Apple doesn’t allow in-app subscriptions without a big fee. To keep things fair and pay a lower subscription price, I recommend just heading to the site in your browser (desktop or mobile) to subscribe.
When you look at UP Fintech Holding – better known as Tiger Brokers – it’s hard not to notice the paradox. On the one hand, the company just reported record highs in revenue, profit, client assets, and funded accounts. Growth is high – very high! – international expansion is successful (so far) and paying off, and the balance sheet is cleaner than it’s been in years. On the other hand, the stock – despite a spectacular run – still trades at levels that imply a heavy dose of skepticism, arguably weighed down by lawsuits, China’s regulatory baggage, worries about peak earnings, and investor doubts about whether Tiger can ever catch up to rival Futu.
Just look at the chart below: after the post-Covid hype sent shares briefly above $30 in early 2021, the stock collapsed into obscurity, drifting around $3–4 for much of 2023 and early 2024. Most investors had written it off as another casualty of China’s shifting regulatory environment. Fast forward to today, and Tiger is trading at $12.50 – up 93% year-to-date and more than 240% over the past twelve months.
On the surface, that kind of move might scream “too late.” A stock that triples in a year rarely looks like a compelling entry point to me. But the numbers underneath tell a different story. Tiger has been posting record client growth, expanding internationally, and steadily widening its margins.
It’s a business that, in some ways, resembles Robinhood – a retail brokerage catering to the next generation of investors – but at a fraction of the valuation. Where Robinhood trades at a premium despite slowing engagement, Tiger’s profitability is accelerating, yet the market still treats it like a risky China-exposed play.
That’s the disconnect I want to explore. Has Tiger’s rally already priced in all the good news, or is this the early innings of a more sustained recovery? Is it a second-tier broker riding temporary tailwinds, or has it quietly built a foundation that could make it a long-term compounder? The answers aren’t simple, but they’re worth digging into. Because sometimes, the best opportunities hide inside the stories most investors gave up on too soon.
In this post, I go deep into Tiger Brokers – roughly 23,000 words – and cover:
The disconnect between Tiger’s recent business performance and how the market still prices the stock
A 90-second “Bam Bam Bam Bam Bam” pitch inspired by Bill Miller – what makes Tiger interesting now
An in-depth breakdown of the business model – how Tiger makes money, where the leverage lies, and how that’s changing
A close look at the core product: how differentiated it is, who it serves, and what role it plays in customers’ financial lives
A closer look at customers: demographics, account quality, retention dynamics, and why average balances matter more than headline account numbers
A detailed operating perspective based on balance sheet structure – what the numbers reveal about scalability and risk
A full-blown competitive advantage analysis: what moat (if any) exists, and whether it’s widening, shrinking, or still forming
The risk of false moats – and why great execution doesn’t automatically mean defensibility
A nuanced view of the customer base, customer acquisition costs & payback periods, retention profile, and embedded stickiness
My framework for assessing management quality – based on actions, not words – including capital allocation discipline and founder alignment
An inversion of the entire thesis – where I challenge myself to kill the idea, pressure-test assumptions, and spotlight the real downside scenarios
A wide-ranging risk analysis that doesn’t just list uncertainties but ranks their potential to break the thesis
Valuation framed simply – long-term user and asset growth, normalized margins, and why entry multiple matters less than execution
Scenario analysis: what Tiger looks like in ten years if margins converge with peers, and why consensus estimates understate earnings power
Relative valuation versus Robinhood, Webull, Futu, and IBKR
A synthesis of why I think the risk/reward setup here could be asymmetric, and what would need to happen for this to become a long-term winner
Before we dive back in, a quick note…
If you're a free subscriber, this might be a good time to consider upgrading. These deep dives are written with full transparency, high analytical depth, and zero fluff – and they’re designed to help you sharpen your own process, not just follow someone else’s opinion.
Disclaimer: I own UP Fintech shares. The analysis presented in this blog may be flawed and/or critical information may have been overlooked. The content provided should be considered an educational resource and should not be construed as individualized investment advice, nor as a recommendation to buy or sell specific securities. I may own some of the securities discussed. The stocks, funds, and assets discussed are examples only and may not be appropriate for your individual circumstances. It is the responsibility of the reader to do their own due diligence before investing in any index fund, ETF, asset, or stock mentioned or before making any sell decisions. Also double-check if the comments made are accurate. You should always consult with a financial advisor before purchasing a specific stock and making decisions regarding your portfolio.
90-Second Pitch: Bam Bam Bam Bam Bam – Why Tiger Brokers, and Why Now?
Bill Miller once said that if you can’t pitch a stock in 90 seconds, you don’t really understand it. You should be able to say: “It’s trading at X, it’s worth Y, and here are five reasons why.” Simple. Punchy. Conviction in bullet form.
So here’s my attempt – not to oversimplify, but to crystallize what makes UP Fintech (Tiger Brokers) interesting right now, after a 240% run in twelve months:
This is a misunderstood brokerage business, currently firing on all cylinders, emerging from years of regulatory uncertainty, now hitting its stride operationally and structurally mispriced relative to both its fundamentals and peers.
Here’s what I’d say in that 90-second window:
BAM: Tiger has just posted its strongest quarter in company history – record revenues, record profit, record net asset inflows. This isn’t a bounce-back; it’s an inflection.
BAM: Over 70% of new funded accounts now come from outside the Greater China area, and the international business is higher-margin, higher-ARPU, and growing faster than the legacy base (“For the first question about the regional breakdown of new funded accounts, in the second quarter, about 50% of newly funded accounts came from Singapore and Southeast Asia region, approximately 30% were from Hong Kong and the Greater China area, 15% from Australia and New Zealand market and around 5% from the U.S. market.“ – Q2 Call).
BAM: The business is scaling with operating leverage, and Tiger is closing the profitability gap to Futu quarter by quarter.
BAM: It still trades at a steep discount to Robinhood – despite better customer economics in some key markets, and a more global, asset-rich client base.
BAM: The risk profile has changed dramatically. China’s crackdown is in the rear-view mirror, the mainland business is shut, and Tiger is now building around regulated hubs in Hong Kong, Singapore, Australia, and the U.S.
So why now? Why bother writing about this stock after such a huge run? I’d say that’s atypical for me.
Because apparently, despite the rally, the market still sees the old Tiger – the China-exposed brokerage with headline risk, legal overhang, and meme-stock clients. It doesn’t see the new Tiger – a profitable, increasingly global, tech-driven platform with long-term optionality in crypto, wealth management, B2B, with margin expansion and a focus on high-quality clients (i.e. decently large account sizes; more on the importance of this metric further below in the deep dive).
That misperception creates the opportunity. Tiger is behaving like a business that deserves a higher multiple – but it’s still priced like one waiting for the other shoe to drop. The core of the bet is that fundamentals have changed faster than sentiment, and price hasn’t caught up yet.
Part 1: Understanding Tiger
What Exactly Does Tiger Sell?
At its core, Tiger is a brokerage. But that label doesn’t quite capture the full picture of what it actually sells – or how differentiated its offering has become. Tiger offers a fully digital, mobile-first investment platform aimed at retail investors, primarily outside the U.S., and increasingly outside of China.
“Regarding total client assets, net asset inflows remained robust, reaching USD 3 billion in the second quarter, over 70% of which came from retail investors.“ - Q2 Call
Become a paying subscriber to read the rest of this post and get access to all of my other research, including valuation spreadsheets, deep dives (e.g. LVMH, Edenred, Digital Ocean, or Ashtead Technologies), and powerful investing frameworks.
Annual members also get access to my private WhatsApp groups – daily discussions with like-minded investors, analysis feedback, and direct access to me.
PS: Using the app on iOS? Apple doesn’t allow in-app subscriptions without a big fee. To keep things fair and pay a lower subscription price, I recommend just heading to the site in your browser (desktop or mobile) to subscribe.
Its core product is access to global equity markets – including U.S., Hong Kong, and A-share markets (via the Connect program) – along with options, ETFs, and derivatives. It’s built for the kind of client who wants access to U.S. tech stocks, but doesn’t live in the U.S. or have an easy way to open a Schwab or Fidelity account.
What makes this platform different from a typical brokerage is the level of vertical integration and product depth Tiger has layered on top. Beyond the execution layer, clients can access advanced trading tools, real-time market data, in-depth company research, margin lending, community features, and – for a subset of higher-value clients – IPO subscriptions, cash management tools, and even wealth products.
In Singapore, for instance, clients can hold multi-currency accounts, access local mutual funds, or invest in structured notes (fwiw, as I assume many of my readers know I own Wise, Tiger facilitates the multi-currency feature through a partnership with Wise).
Importantly, in a way somewhat similar to IBKR, Tiger Brokers also serves institutions through a B2B model. While it’s often described as a “white-label” solution, it isn’t a traditional one where a partner simply rebrands Tiger’s entire platform. Instead, the company provides a more tailored institutional service via its TradingFront platform and APIs. This allows financial institutions, wealth managers, proprietary trading firms, and third-party platforms to integrate Tiger’s infrastructure – such as account onboarding, trading, data, and risk tools – directly into their own systems.
This isn’t a commodity brokerage. Tiger competes primarily through product depth and localization, not rock-bottom pricing. It’s positioned in the mid- to upper-tier of the digital brokerage space – above no-frills, budget players but below private banking and traditional wealth managers. The onboarding process is smooth, the UX is polished, and the range of investable assets is deep enough to retain more sophisticated clients over time. One of the more notable differentiators is Tiger’s effort to build a globally accessible brokerage product with strong compliance infrastructure – licenses in Hong Kong, Singapore, Australia, and the U.S. are now live or in progress. That regulatory stack alone is not trivial to replicate.
In terms of product roadmap, the company isn’t standing still. I think product velocity is high. It’s expanding further into crypto – with licenses now approved in Hong Kong and applications in flight in other jurisdictions.
“Product experience has always been the key to Tiger's long-term success. Web 3 is still a relatively new area compared to the traditional Web 2 trading. We are committed to maintaining Tiger's high standards in product functionalities. To further these efforts, we have partnered with seasoned strategic investors in the Web 3 ecosystem, who are also pioneers and successful entrepreneurs in the early days of the digital asset exchange. So by combining their expertise with our experience in Web 2 fintech, we aspire to jointly develop leading-edge digital asset trading products that will stand out in the global market. Although this business still accounts for only a small part of our total revenue, we are seeing strong growth, especially as we keep expanding in Hong Kong and roll out industry-leading features, like digital asset deposit and withdrawal.
In the second quarter, digital asset trading volume increased around 65% quarter-over-quarter and asset under custody on our exchange nearly doubled sequentially.” - Q2 2025 Call
And as touched upon above, it’s also leaning into wealth management, with new offerings aimed at long-term investors rather than just active traders.
“So regarding your second question about the wealth management, overall, we are quite satisfied with the growth pace of our wealth management business and the current diversity of our product offerings. We offer stable U.S. products like money market funds and U.S. treasury bonds for investors to manage their idle cash as well as fixed coupon notes and services like the EAM platform and DPM discretionary accounts for the advanced users, institutions and family office, et cetera. In the future, we will continue to develop our wealth management business and enhance the synergy with our current brokerage business“ – Q3 2024 Call
This shift is very much relevant because it broadens Tiger’s monetization opportunities and extends the lifetime value of its customers. Over time, these wealth products could make the revenue base less transaction-dependent and more recurring.
“On the institutional front, we launched a one-stop wealth management solution for major financial advisory firms and wealth management entities in Singapore. Addressing the industry's current pain points such as complex client onboarding requirements, cumbersome account opening processes, limited trading options, and low transaction settlement efficiency, Tiger introduced its next-generation Turnkey Asset Management Platform (TAMP). This platform offers flexible account structures, fully online account opening, multi-market and multi-asset trading, extensive analysis and trading tools, and diversified reporting. In 2024, we continued to strengthen our position as a premier platform for financial advisers and external asset managers in Singapore. Our strategic efforts in expanding institutional partnerships led to a significant increase in both the number of onboarded advisers and total assets under custody (AUC). The AUC in 2024 doubled year-over-year compared to 2023, reflecting strong client engagement. Looking ahead, we remain committed to strengthening our financial advisers and external asset managers ecosystem by expanding our network of institutional partners, introducing tailored investment solutions, and continuously enhancing platform capabilities. Our focus remains on driving sustainable growth while delivering best-in-class services to our institutional partners.“ - 2024 Annual Report
While the bulk of Tiger’s net revenues still come from trading commissions and interest income (91% of the first six months of 2025), there’s an emerging third leg worth mentioning: enterprise SaaS and corporate (consulting) services. This is where the company is quietly building diversification beyond the retail brokerage.
Since branding as “UponeShare” in Q4 2022, the platform has steadily added clients, growing from 419 total clients at the end of 2022  to 633 by Q1 2025, and 663 by Q2 2025. Through the UponeShare platform, Tiger provides employee stock option management (ESOP) software to more than 660 companies. That division is producing recurring, high-margin revenue that scales cleanly once the software is built.
“Furthermore, IPO distribution is also an integral part of our comprehensive services package and is a major focus for our future growth. […] Underpinned by the brokerage services, we have successfully expanded our product offerings to ESOP management, IPO distribution, and wealth management. These integrated product offerings are highly synergetic and have significantly increased the average revenue per user and customer lifetime value.” – 2024 Annual Report
On top of that, Tiger has been expanding its enterprise account services (“dedicated to providing a full life‑cycle of investor relations and public relations services, tailored to meet the diverse communication needs of businesses across various industries.”), now serving close to 500 corporate clients, including high-growth names like Caocao Mobility and Geek+ (they onboarded nine corporate clients in Q2).
These enterprise relationships often start with financial services but can open the door to broader integration with Tiger’s ecosystem.
The other component is investment banking, where Tiger has been active in IPO underwriting (“In 2024, we participated in 48 U.S. and Hong Kong IPOs.“). In Q2 alone, the firm underwrote seven Hong Kong IPOs and four U.S. IPOs, ranking third among Chinese ADR underwriters. While this line is less predictable than SaaS, it further diversifies the revenue mix and adds credibility in corporate finance circles.
“In the second quarter, we underwrote 7 Hong Kong IPOs and 4 U.S. IPOs, helping to boost our other revenue to a new quarterly high.“ – Q2 Call
Altogether, these segments still account for less than 10% of total revenue today, but they’re growing faster than the core business and demonstrate that Tiger isn’t just a one-trick brokerage. If they scale, they could reduce the company’s dependence on trading cycles and make the overall business model sturdier.
So in sum, while Tiger might look like a Robinhood or Futu on the surface, it’s playing a slightly different game: more international, more full-stack, more regulatory-intensive – and potentially, more defensible.
How Does Tiger Actually Make Money?
Tiger was founded in 2014 by Wu Tianhua, a former NetEase product manager who recognized the gap between Chinese retail investors and global markets. From the start, the business was built around a simple question: how can someone living in mainland China or Southeast Asia easily access U.S. and global equities? Robinhood didn’t exist outside the U.S., and legacy brokerages had clunky onboarding, limited language support, and high minimums. Tiger leaned into that whitespace and became a tech-first brokerage tailored for Chinese-speaking users who wanted access to U.S. markets.
That was the first chapter. The second one began when China’s regulatory crackdown on offshore brokerages forced Tiger to pivot. In late 2022, the company voluntarily shut down its mainland China business – Tiger suspended new account openings for mainland China residents, but existing mainland clients could still use the platform – removing the biggest source of regulatory uncertainty. Since then, Tiger has doubled down on building out regulated hubs in Hong Kong, Singapore, Australia, and the U.S. It’s a very different company now – not just in geography, but in how and where it makes money.
At the most basic level, Tiger earns revenue through transaction-based commissions (48% of FY24 total net revenue), interest income (from margin financing and idle client cash; net contribution (after interest expenses): 43% of net revenue), and fees from various services layered on top of the brokerage (around 9%). These include currency conversion fees, subscription revenue from premium data and research, and in some markets, fees tied to wealth and asset management products.
“Within commission revenue, about 70% comes from cash equities, 30% from options and the rest comes from futures and other products.” - Q2 Call
I found this article (“Tiger Brokers Review (2025): My likes and dislikes of this trading platform“) helpful in getting a decent grasp on the various fees charged, and in understanding the value proposition of Tiger (Easy-to-use application, Access to multiple markets and products, Low commission fees, convenience features like "auto invest" features).
Here’s a comparison to the big local peers from the article:
The business is transactional at its core, but as discussed it’s slowly shifting toward more recurring revenue sources:
“We keep optimizing our topline mix to overcome market volatility. While we primarily generate revenues by charging our customers commission fees for trading of securities, we also earn interest income or financing service fees arising from or related to margin financing and securities borrowing and lending transactions provided by ourselves or third parties to our customers for trading activities, as well as other income from IPO distribution, and wealth management.
We generate revenues primarily by charging our customers commission fees for trading of securities as well as earning interest income or financing service fees arising from or related to margin financing and securities borrowing and lending transactions provided by ourselves or third parties to our customers for trading activities.“ - 2024 Annual Report
Tiger’s Most Important Unit
If you zoom in on unit economics, the most important “unit” is the funded client account – not just downloads or registered users. This is the engine that drives everything else. Tiger’s latest quarterly results show 1.26 million funded accounts, with 96,000 net additions – up 52.9% year-over-year (“In the first half of the year, we have acquired more than 100,000 new funded accounts, more than 2/3 of our full year target of 150,000 in 2025.“).
Customer acquisition cost (CAC) hovers around $200–300, though it varies by region. That might seem high at first glance, but it becomes easier to justify when you consider Tiger’s CLV and the payback period:
“So far in the third quarter, the number of new funded accounts in Hong Kong has now nearly matched the growth we have seen in Singapore. Our accelerated expansion in Hong Kong not only creates a healthier, more sustainable growth, but also deepen our understanding of the local market. Over the past 2 years, our dedicated efforts have started to pay off. Going forward, we will continue to speed up our efforts in Hong Kong, and you will see more tighter events to drive user growth and brand awareness. Regarding CAC, since we started ramping up our customer acquisition in Hong Kong in the second quarter, the average CAC is around 400 plus.
It's relatively higher than other markets, but the payback period remains quite healthy, about 2 quarters under current market conditions. For third quarter and the rest of the year, we expect the average CAC in Hong Kong to fluctuate based on our marketing strategy. We anticipate it will stay around this level.“ – Q2 2025 Call
“The quality of users in Hong Kong is the highest across all the markets we enter, and the company is confident in maintaining the user quality of the newly added accounts in the 3rd quarter.“ – unknown source (read it on X)
“First of all, we will beef up efforts in high-value markets by Hong Kong, where the quality of users is significantly higher. From a payback perspective, a higher CAC in those markets is acceptable.“ Q1 2025 Call
“So in 2025, our focus on customer acquisition will prioritize user quality and ROI. We plan to expand our efforts to acquire high net worth user base rather than just pursuing user number growth. Therefore, we are setting a target of 150,000 new funded users, maintaining the same level as in 2024. However, we do expect to see the improvement in customer quality metrics such as the average client assets and the ARPU for these new users in 2025. Regarding the regional mix, we anticipate that the overall situation will pretty much in line with the actual breakdown in 2024 with Greater China region being the primary contributor. And in 2025, while ensuring the quality of new users, we have higher expectations for growth in Hong Kong and U.S. market, and we will consider increasing our marketing input, if the market conditions are favorable.“ Q4 2024 Call
Revenue per funded account in Hong Kong, for instance, is significantly higher than in Southeast Asia – in part because the asset base is larger and those clients tend to use more premium features like margin or wealth products. Tiger doesn’t disclose gross margin per client, but based on the trend in operating leverage and the rise in non-commission revenue, it’s clear that newer cohorts are accretive. As volume scales, fixed costs like product, compliance, and platform development are being spread over a larger base – a classic path to margin expansion. You just have to look at IBKR’s pre-tax margins (75%) to grasp how attractive of a business the brokerage business can be if executed perfectly (IBKR is not directly comparable, of course).
In brokerage, the number of customers tells you something about reach, but the average account size tells you a lot more about the economics of the business. Larger accounts tend to trade more actively in absolute dollar terms, generate higher commissions or spreads, and, importantly, drive more net interest income on idle cash. This is why the traditional brokers like Charles Schwab or Interactive Brokers can make so much money even without tens of millions of small accounts – they capture balances that are orders of magnitude higher than Robinhood or eToro. In Schwab’s case, advisory and wealth clients often bring in accounts north of $300k on average, which makes asset-based fees and interest income a significant driver of earnings.
Take Interactive Brokers and Robinhood as a contrast. IBKR’s clients average around $158k per account, reflecting a base of sophisticated retail and professional traders. That means IBKR doesn’t need a Robinhood-sized customer base to build substantial assets under custody – fewer but wealthier clients translate into stable commission income, interest income, and even institutional services revenue. Robinhood, by contrast, has about $4k–$6k per funded account, with a median balance closer to a few hundred dollars. This creates a fundamentally different monetization model: Robinhood relies more on transaction-driven revenue (like payment for order flow), options activity, and ancillary services. The small account size limits the revenue per user and makes scaling through sheer customer numbers essential.
In Q2, Tiger reported $52.1 billion in total client assets (“up 13.5% quarter-over-quarter and 36.3% year-over-year, marking 11 consecutive quarters of growth”) and about 1.19 million funded accounts, which works out to an average account value of roughly $43,700.
“In addition, we are glad to see that the quality of newly funded users continue to improve in the second quarter with the average net asset inflow of newly acquired clients exceeding USD 20,000, reaching a historic high.
Notably, the average net asset inflow of newly acquired clients in Hong Kong and Singapore is substantially higher at around USD 30,000.” - Q2 Call
Over time, Tiger reported a steady rise in assets per customer – from the low-20k range in early 2023 to over 40k by mid-2025.
What’s striking is not just the growth in funded accounts (from ~134k in early 2020 to nearly 1.2 million today), but also how much deeper each relationship has become. This shift is important for the economics of Tiger’s business. Larger average accounts mean more interest income on idle cash, higher dollar trading volumes, and greater monetization potential per user. It also sets Tiger apart from many of its retail-focused peers: Robinhood averages around $4-6k (depending on the estimates), Webull about $2.7k, while Interactive Brokers sits much higher at roughly $158k. With an average of ~$43k, Tiger is carving out a middle ground – wealthier than the typical U.S. retail app customer, though still well below IBKR’s professional base. If Tiger can sustain this trajectory, it positions itself as a broker with not just a growing customer base, but one that is steadily becoming more valuable over time.
“In the second quarter, all markets saw double-digit sequential increases in client assets, with Hong Kong and Singapore experiencing around 50% and 20% quarter-over-quarter growth, respectively.“ - Q2 2025 Call
This matters because account size dictates monetization. Smaller balances limit interest income and fee potential, forcing companies to rely on customer growth and trading activity to drive revenue. By contrast, brokers like IBKR or Schwab can earn significant revenue even with fewer accounts, simply because their customers bring more assets. For Tiger, the strategic runway lies not only in adding more users but also in deepening wallet share – if it can shift its mix toward higher-value clients in markets like Singapore or Hong Kong, the economics of the business could change dramatically.
Strategically, going forward, Tiger is very deliberate about the quality of incremental added accounts vs. pure quantity.
“As mentioned earlier, the average net asset inflow of newly acquired clients exceeded $20,000 dollars and in Singapore and Hong Kong, it even reached about $30,000. More importantly, the nearly 40,000 new users in Q2 contributed more net asset inflow in the quarter than the over 60,000 new users in the first quarter. Additionally, our overall customer acquisition cost decreased by about 10% compared to the first quarter. So looking ahead, whether from an efficiency perspective or on a profitability standpoint, we plan to continue optimizing and dynamic adjust our customer acquisition strategies by focus on user quality and client assets.“
“[…] most importantly, targeted adjustments we made to our customer acquisition channels. This included shutting down some low quality, low ROl channels and posting certain online advertisements in Singapore to ensure the high quality user base. Overall, these adjustments have been proved to be effective. We place great emphasis on increasing client assets and maintaining a healthy net asset inflow mix.“
Geographically, Tiger is now a very different beast than it was even two years ago. In Q2 2025, international users accounted for over 70% of new funded accounts.
“For the first question about the regional breakdown of new funded accounts, in the second quarter, about 50% of newly funded accounts came from Singapore and Southeast Asia region, approximately 30% were from Hong Kong and the Greater China area, 15% from Australia and New Zealand market and around 5% from the U.S. market.“ – Q2 Call
“Well, in the Q4, about 60% of new funded users came from Singapore and Southeast Asia, about 25% were from Greater China area, around 10% from Australia and New Zealand market and the remaining 5% came from the U.S. market.” Q4 2024 Call
The U.S. market is still small relative to the potential of that market but growing – largely via the B2B white-label business.
From a revenue contribution point of view, the table below was shared in the last annual report, but it didn’t quite add up to what I was reading about the company.
“Our revenues in 2022, 2023 and 2024 were mainly generated in New Zealand, the U.S. and Singapore. Our New Zealand, U.S. and Singapore subsidiaries have contributed over 92.0% of total revenues for the year ended December 31, 2024.”
I reached out to Marco Rodriguez on X who’s been studying the business for a while. He explained …
“the reported geographic distribution does not reflect the way the business is managed, or where the residency of the customers is set. Instead, they recognize different revenues in each of their subsidiaries. They do not disclose these figures unfortunately, so it’s up to us to estimate them. Singapore is their main operating market (roughly 1/3 of SG use Tiger as their broker) and it’s their main revenue source. Hong Kong is a rather new market, much smaller than Singapore. Nonetheless, there might be some additional B2B revenue recognition here as they do HK IPOs underwritings. United States is not a major market for them in B2C, but it’s where they perform the self-clearing of the transactions that they can do outside of IBKR, so commissions should be accounted here. This and the IPO underwriting, leads to the number being much higher. New Zealand is a small market for them, I believe they record the revenue in this subsidiary given the regulatory environment.”
SG & HK are wealth-centers for large part of ASEAN & worldwide, so we can say:
Operations are done in Greater China (incl. Mainland), with proper compliance levels on each of their operating countries.
Customers are located world-wide, but concentrated in Singapore.
Revenue is shifted around to their advantage and isn’t a reliable way to estimate country risk.
The geographic shift that started in 2022 has had two effects: first, it reduced China risk dramatically. Second, it raised the average client asset value, since many international users bring in more investable capital.
“So far in the third quarter, the number of new funded accounts in Hong Kong has now nearly matched the growth we have seen in Singapore. Our accelerated expansion in Hong Kong not only creates a healthier, more sustainable growth, but also deepen our understanding of the local market. Over the past 2 years, our dedicated efforts have started to pay off. Going forward, we will continue to speed up our efforts in Hong Kong, and you will see more tighter events to drive user growth and brand awareness.“ - Q2 2025 Call
Still, most markets Tiger operates in are emerging markets in regulatory terms – especially when it comes to crypto and wealth licensing – and there’s always the risk that local authorities change the rules halfway through the game. For now, though, Tiger is positioning itself on the right side of regulation, building moats through licensing and compliance infrastructure that are hard for copycats to replicate quickly.
The platform itself is entirely digital, delivered via mobile and desktop apps.
There’s no brick-and-mortar component, no wealth managers in suits – it’s all self-directed. Client acquisition is largely digital, too: app stores, influencer marketing, online finance forums, and referrals. One well-known financial content creator from Singapore who I talked to told me the marketing team has reached out to him multiple times (despite him not always responding ;-)).
Overall, this gives Tiger a clean, scalable value chain: product development and licensing at the top, distribution via the app layer, and monetization through both transactions and financial services.
Structurally, the company is listed on the NASDAQ under the ticker TIGR and incorporated in the Cayman Islands, with operations run through subsidiaries in Hong Kong, Singapore, and other markets.
It is noteworthy that Tiger has a sizable shareholder in Interactive Brokers, which owns a 7% stake and serves as Tiger’s clearing and execution partner for U.S. equities – or used to serve historically:
“In addition, we distinguish ourselves in the market by moving up to the high-entry-barrier sector of self-clearing in the U.S. with acquisition of TradeUP Securities in 2019. We have restructured and upgraded the clearing system of TradeUP Securities to achieve high business flexibility. By the end of the fourth quarter of 2024, we have self-cleared over 90% of U.S. cash equity and option traded on our platform, further improved our operating efficiency and profit margin.” - Annual Report 2024
“We began self-clearing a portion of the trades of the U.S. stocks and other financial instruments in the third quarter of 2019, following our acquisition of TradeUP Securities. Nowadays, we self-clear a majority of U.S. and Hong Kong cash equities trades and we expect to increase further in the future the proportion of such trades that we self-clear. Self-clearing requires us to finance transactions and maintain margin deposits at clearing organizations.” - Annual Report 2024
Tiger’s move to self-clearing marked an important strategic shift: instead of outsourcing clearing and settlement, it built the infrastructure to handle these functions internally, which is technically complex, capital-intensive, and requires rigorous compliance across multiple jurisdictions. The difficulty lies not only in developing the technology stack to process trades, manage risk, and maintain custody, but also in securing regulatory approvals and building the operational muscle to ensure reliability at scale – something few newer brokers attempt because of the high fixed costs and long lead time. From a competitive advantage perspective, self-clearing gives Tiger tighter control over its client experience, better unit economics through reduced reliance on third parties, and optionality to expand its institutional services (like APIs, custody, and white-label solutions). It also creates a higher barrier to entry, since brokers that remain dependent on third-party clearing lack both the same cost efficiencies and the flexibility to build B2B businesses on top of their infrastructure.
As for cyclicality – this is a financial business, so of course there’s some. Trading volume dips during market lulls, and risk appetite affects margin financing demand. But this isn’t a pure play on bull markets. During the 2022–23 tech slump, Tiger still grew client assets and invested through the downturn. And because the product is increasingly diversified, it isn’t just riding short-term trading spikes anymore – it’s becoming more resilient.
What’s changed over the last two years is the company’s move from Phase 1 (user growth) into Phase 2 (monetization and margin expansion). Tiger’s cost base is relatively fixed – product, tech, compliance, marketing – while revenue per user is rising. That’s classic operating leverage. Mature peers like Futu run at ~50% net margins.
Tiger isn’t there yet – Q2 net income margin was 34% – but the delta is narrowing fast. Five years from now, 40%+ net margins aren’t out of the question if growth continues, especially in high-ARPU regions like Hong Kong.
When it comes to KPIs, five really matter in a brokerage business.
First, the number of funded accounts, which shows how many paying customers the platform has attracted.
Second, the average account size
Third, the average revenue per account, which signals how effectively the platform is monetizing its user base.
Fourth, interest-related income, a critical driver in a rising rate environment.
And fifth, trading activity per account, which reflects engagement and commission sensitivity.
Together, these metrics sketch the health of the franchise in terms of growth, quality, and monetization.
One additional angle worth considering is the “yield on client assets” – essentially revenue as a share of AUM. While not a standard industry metric, it offers a window into how intensively a broker is monetizing its scale. A declining yield isn’t necessarily a bad thing; it can actually point to a scale economies shared mindset – sharing scale with customers –, which has been the hallmark of firms like Schwab and IBKR.
The open question for Tiger is whether it has this mindset in its DNA or if it may adopt it over time as it matures. I need to study management’s comments further in the coming quarters to get a better grasp on this question.
Who Uses Tiger – and Why Do They Stay?
Tiger solves a deceptively simple problem: how can a retail investor outside the U.S. access global financial markets without friction, in their own language, and through a platform that feels native to them?
For customers in Hong Kong, Singapore, Australia, or Southeast Asia, the answer has often been either legacy banks with clunky interfaces, limited product access, and high fees – or sketchy offshore apps with questionable regulatory standing.
Tiger sits in the middle. Its value proposition isn’t groundbreaking, but it’s deeply practical: one app, one KYC process, one multi-currency account – and access to U.S., Hong Kong, and China Connect markets, along with options, ETFs, and margin. For a digitally native investor who wants to build a global portfolio from Asia, this setup is valuable.
If Tiger disappeared tomorrow, the impact wouldn’t be all too significant in my view. Users could switch to local competitors, Interactive Brokers, or the regional banks – but they’d pay a price in UX, onboarding complexity, and localized support. It’s an annoying process, but not the end of the world. Futu’s moomoo platform is a formidable competitor in the same segments, and in Hong Kong in particular it would likely absorb much of the demand – though it’s worth pointing out that the competitive dynamics between the two have been a big part of what’s driven innovation and customer adoption to begin with.
What gives the company staying power isn’t just the trading access – it’s the ecosystem: multi-asset portfolios, research tools, premium data subscriptions, community features, and, increasingly, wealth and crypto offerings. The more of that stack a user adopts, the harder it becomes to leave. The stickiness of brokerage businesses is well understood.
So who are these customers? They’re mostly retail investors, typically younger and more digitally fluent than the traditional brokerage client. Tiger doesn’t break out exact demographics, but we know from past disclosures and investor presentations that the user base skews male, aged 25–40, and leans toward the mass affluent segment – think working professionals with investable assets in the $10k–$200k range. They’re not Robinhood-style meme traders, but they’re not private banking clients either. They care about low fees, but also about speed, ease of use, transparency, access, and control. And they’re often interested in U.S. tech stocks, not just local equities. That interest drives engagement – and creates opportunities for Tiger to cross-sell higher-margin services like margin lending, structured products, and portfolio management.
Retention is strong. Tiger doesn’t publicly disclose churn, but multiple quarters of net positive asset inflows – even during broader market volatility – suggest that users who fund accounts tend to stick around. During the Q3 2023 call they also shared that “the retention rate of [their] local users with assets remain[s] at 99%“
In the most recent quarter, net asset inflow hit an all-time high “with net asset inflows of US$3 billion in the second quarter, primarily driven by retail investors.“
The rise in recurring revenue products (like wealth management and data subscriptions) further indicates that Tiger is attracting new & multi-product clients. The more features a user touches, the longer they stay – and the more predictable the economics become.
So there’s definietely room to deepen that connection, both on the retail and professional investor side. As Tiger builds out its wealth stack, crypto infrastructure, and B2B licensing, the app could become the financial hub for a specific kind of globally minded investor in Asia. That isn’t a guaranteed outcome – but if the company executes well, it has a shot at becoming the go-to platform for cross-border investing in markets where incumbents are still catching up.
Is This a Simple and Predictable Business?
Tiger operates in the online brokerage industry – a space that, on the surface, looks brutally competitive. Pricing is increasingly transparent, and regulation casts a long shadow. But when you zoom out, this isn’t a terrible industry to be in – not at all!
Global investing continues to secularly grow, especially in emerging markets. Financialization is picking up in places like Southeast Asia and Hong Kong. Access to global capital markets is becoming more of a “default” expectation for middle-class professionals. And platforms that can deliver that access in a localized, compliant, and mobile-native way are benefiting from these trends.
One question I've been grappling with is how they have been able to scale so fast? Is it just better product/better marketing? In what way are they truly differentiating themselves from the big local competitors? My answer so far is that it's a mix of the strong secular tailwinds in the region described above + product improvements + aggressive & good marketing.
“In the third quarter, we continued to upgrade our product offerings on our platform to enhance user experience. In September, we officially launched Hong Kong stock options and Hong Kong short selling features on our platform. And in early November, we collaborated with Hong Kong Exchange to upgrade the Hong Kong stock option feature by offering weekly contracts in addition to monthly contracts to better meet investors' trading and risk management needs, allowing them to trade based on short-term events. Additionally, Tiger Boss debit card is gaining more popularity since its launch in Singapore. So we upgraded the product to include T+0 automatic subscription and redemption feature for Tiger Vault, our wealth management product.
The integration allows users to manage their investment portfolios more conveniently, seamlessly bridging daily spending, wealth management and stock investment. Moreover, in October, we enhanced our overnight trading capabilities. Filled next session orders will be automatically passed on to the pre-market and regular trading session to ensure user experience and execution quality.“
What scares me in an investment is a business that has to constantly reinvent itself to stay relevant. That’s not Tiger. The industry itself has evolved – absolutely! But unlike tech verticals that shift every two years, at its core, brokerage will remain brokerage. Yes, there are new wrinkles – zero-commission trading, crypto, B2B white-labeling – but the core product will likely remain the same for decades to come.
The user onboarding flow, the compliance requirements, the infrastructure of capital markets – they’re all sticky. If anything, the regulatory bar is rising, which makes it harder for new entrants to come in and steal share. The direction of travel is clear: more licenses, more complexity, more consolidation. And in that environment, companies that already have the regulatory stack in place – like Tiger – are positioned to win.
The competitive landscape isn’t empty, but it’s also not overcrowded. Tiger’s main competitor is Futu, which operates a nearly identical model and has historically run a tighter, more profitable ship.
Futu is the market leader in many ways – stronger monetization, better margins, and a larger asset base. But Tiger is closing the gap. Client asset growth has accelerated, revenue is compounding, and margin expansion is underway. Futu’s core market has also been more exposed to mainland China, which could become a drag depending on policy shifts.
The other reference point is Robinhood – retail investors’ darling–, which shares a similar product vision but is more U.S.-centric and currently trades at a much higher multiple. Robinhood monetizes less effectively on a per-user basis in many metrics and hasn’t made the same international regulatory push.
A reference for European investors could maybe be Trade Republic.
Then there’s Interactive Brokers, a powerful backend and execution engine – and ironically, a shareholder and partner of Tiger. But IBKR isn’t chasing the same segment. It’s built for more professional investors. Tiger’s sweet spot is the retail investor who wants a sleek app, localized service, and enough product complexity to grow with them, but not overwhelm them.
Can this business be easily disrupted? Possibly, but not cheaply. Building a compliant, multi-market, fully licensed brokerage stack is expensive, slow, and filled with operational risk. Most fintechs would rather embed someone else’s platform than build one themselves. That’s where Tiger’s position becomes more defensible. It’s not just a front-end app – it’s the full infrastructure behind the investing experience in each market it operates in.
So, is this business simple and predictable? I think so – at least relative to other fintech bets. The revenue model is transparent. Client assets, funded accounts, take rate – all of it lends itself to forecasting. The cost base is mostly fixed. And if customer acquisition continues to be efficient, the math scales cleanly. I don’t need this company to become dominant to make the investment work. I just need it to keep doing what it’s already doing – compounding steadily, quarter by quarter.
If I had to explain it to someone outside the investing world, I’d say this: Tiger is an international version of Robinhood, but better, and aimed at Asia. It helps retail investors buy U.S. and global stocks through a regulated, mobile-first platform. The product works, the unit economics are improving, and the company is still mispriced relative to its fundamentals.
That’s simple enough for me. And that simplicity, paired with solid execution, is exactly what gives the business its long-term appeal.
Part 2: Is Tiger a Good Business?
At first glance, if you haven’t studied the business model before, you might not assume a retail online brokerage company has much of a moat. The industry feels commoditized – trades cost almost nothing, user interfaces are increasingly looking similar, and the barriers to customer churn appear low.
But if you take the time to really dig in, Tiger does have several competitive advantages – not huge, impenetrable ones maybe – but distinct, difficult-to-replicate edges that are quietly becoming more durable over time.
Let’s start with regulatory infrastructure. Tiger has spent the last few years securing licenses in Hong Kong, Singapore, Australia, and the U.S., while simultaneously exiting its legacy China business. This is not a fast or cheap process – licenses can take years to obtain, and maintaining compliance across multiple jurisdictions is both technically and organizationally demanding. That complexity creates a real moat in my view.
“So in terms of VATP, we got the Hong Kong SFC Type 1 and Type 7 license before Chinese New Year. So this officially make us a licensed virtual asset trading platform in Hong Kong. With those license, we can now legally offer spot trading and custody service for major cryptocurrencies like Bitcoin and Ether as well as tokenized assets. By integrating our crypto service with our broker-dealer entity, we can create an ecosystem combining Web 2 and Web 3 assets. Our goal is to become the bridge between traditional finance and cryptocurrency.“ - Q4 2024 Call
You can’t just clone Tiger’s international presence. It’s not a feature set; it’s a legal footprint. Very few new players have the willingness, endurance, or capital to build that stack from scratch. Among emerging fintechs, many either piggyback on existing players or limit themselves to a single geography.
There’s also a soft moat in product breadth (see screenshot below) and localization. Most Western brokerages struggle to serve Asian retail investors in a culturally and linguistically native way. Marketing requires a good understanding of the local mentality and needs.
Tiger was born in this niche. Its app supports multi-currency wallets, localized tax and reporting features, IPO access in local markets, and multi-language customer service. These features aren’t flashy, but they make a real difference in customer stickiness. Once you’ve set up an account, funded it, explored the various investment products, maybe set up the auto invest feature, nd gotten comfortable with the interface, the switching cost – even for a B2C product – becomes more meaningful than it first appears.
“In Singapore, we launched the Central Provident Fund account trading and Supplementary Retirement Scheme account trading features in July. These new offerings enable eligible clients to utilize a portion of their CPF Ordinary Account savings and retirement funds to invest in approved financial products such as selected Singapore listed stocks, while enjoying tax benefits.“ - Q2 2025 Call
From a brand perspective, Tiger doesn’t have prestige equity in the sense of a Ferrari or Hermès, but it does have something equally powerful: trusted functionality. It’s not seen as a fly-by-night operator. In regions like Hong Kong and Singapore, it’s emerging as a default option for international brokerage among digital-native investors. Tiger also plans to continue to invest in brand building.
“This reduction highlights our success in expanding our internationalization strategy as Tiger Brokers brand gained traction among local users in Singapore through positive word-of-mouth referrals, resulting in organic traffic and cost efficiencies.“ - Q2 2023 Call
Tiger also plans to continue to invest in brand building:
“We're also ready to invest more in brand user awareness. These type of investments might not yield immediate conversions, which can push up CAC in the short term, but they are important for our long-term growth and the brand agreements.” - Q1 2025 Call
It’s too early to say whether it will enjoy habitual, toothpaste-level brand stickiness, but in the brokerage world, reputation, trust, and reliability matter more than emotion. Tiger’s consistent growth, steady product expansion, and clean regulatory track record are what’s fueling its word-of-mouth engine.
Does the company have pricing power? Maybe a little – but it’s not the lever they’re aggressively pulling. Management seems to understand that they’re in a long game. Raising trading commissions or FX fees might generate a short-term pop, but it risks alienating a user base that is extremely price sensitive and quick to compare alternatives. Personally, I’d much rather see the company reduce fees (and lower the spread on margin loans) over time – the aforementioned scale economies shared mindset.
Maybe this passage includes a hint at management’s mindset:
“We've also introduced some products differentiation to better serve local users. For example, our trading commission are generally lower than most platforms in this market and our money market fund yields are comparatively attractive. These are just a few ways we are delivering real value to users. So looking ahead, we plan to continue to invest in both talent and marketing in Hong Kong with the goal of delivering a superior product experience. We are confident that with time, continued optimization and consistent execution, we will be able to secure a meaningful share of the Hong Kong market.“ Q1 2025 Call
Instead of raising fees and spreads, Tiger is gradually expanding ARPU by layering in new monetization channels – wealth products, margin lending, premium research, and crypto. That path requires more work, but it’s far more sustainable. Pricing power here doesn’t come from raising headline fees – it comes from embedding more functionality into the customer experience and capturing value across more of their financial life. Growth will be driven by user, trading volume growth, and asset growth (quite frankly, I see a lot of similarities to Wise and IBKR here).
As for cost advantages, there’s an argument to be made around scale. Tiger’s infrastructure is increasingly global, but tech-driven and lean. As fixed costs get amortized across a growing user base, we’re seeing clear operating leverage.
Gross margins are healthy and trending up. Customer acquisition costs remain within a reasonable band, and each incremental dollar of revenue appears to be more profitable than the last.
Does Tiger benefit from network effects? Not in the classic two-sided marketplace sense. But there is a light form of data flywheel and platform stickiness that comes with scale. As the customer base grows, so does the company’s ability to underwrite margin risk, negotiate better execution, establish its own clearing systems, and reinvest into R&D. Tiger is also developing a B2B offering, which could evolve into something more platform-like over time – but it’s still early. Right now, the competitive edge is still rooted in integration, not true network effects.
And what about the directionality of the moat? I’d argue the moat is widening. International expansion is accelerating, not stalling. Operating leverage is kicking in. New revenue streams are being added carefully, with clear regulatory scaffolding. Meanwhile, new entrants are scarce, and most existing players are either hyper-local or institutionally focused. Futu remains a strong competitor – but beyond that, Tiger’s position looks increasingly defensible.
Could I compete with Tiger if you gave me $100 million? Not really. I’d need licenses across four or five major jurisdictions, a secure tech stack, a user-friendly front end, deep integrations with clearing houses, a multi-language support operation, and brand credibility in the Asian investor community. That’s not a trivial build. The barriers to entry are real – and rising.
If you’re looking for a deep moat in the Morningstar sense, Tiger may not scream “wide” (yet). But if you look at the direction of travel – the way the business is consolidating trust, licensing, and user habits – you could see something quietly durable taking shape. And in my book, a modest moat that’s expanding is often more valuable than a large moat that’s slowly eroding (see illustration above).
Is This a High-Quality Business?
When I think about business quality, I try to strip away the noise of valuation, macro, and sentiment and just ask:
If I had to own this company for the next ten years with no price updates, would I feel good about it?
In Tiger’s case, the answer is leaning toward yes – and trending stronger with each passing quarter. Why did I not come across this idea a year ago?
Tiger is, at its core, a capital-light, software-leveraged business. It requires relatively little in terms of capex to keep the engine running. The latest filings show modest CapEx levels. The core cost base is tech and compliance – not plants, inventory, or physical distribution. That structure allows the business to scale without needing to reinvest heavily just to maintain its current position.
Can Tiger grow without massive reinvestment? In theory, yes – but it’s choosing not to. And I think that’s the right call. The company is still in land-grab mode across Southeast Asia and Hong Kong. Customer acquisition is costlier than, say, a luxury brand with built-in pull – CAC is around $200–300 per user – but these aren’t one-and-done transactions. Most customers who fund an account stick around, and many gradually adopt higher-margin products. That dynamic supports long-term CLV well above CAC, even in competitive markets.
Importantly, Tiger is moving away from a purely transactional business model. Trading commissions are still a big piece of revenue, but a growing share now comes from interest income and other revenue streams discussed above. The recent crypto push adds another layer of optionality.
Is demand cyclical? To a degree. Trading activity tends to rise and fall with volatility and sentiment. But the business is far less cyclical than it used to be. During drawdowns, Tiger still sees net asset inflows. And because its cost base is mostly fixed, even slower growth doesn’t tip the model into unprofitability. This isn’t a commodity producer where revenue disappears in a downturn. It’s closer to a financial services platform that expands or contracts around a stable core.
In terms of market share, Tiger doesn’t dominate globally – but it holds a strong and rising position in its core geographies. In Hong Kong and Singapore, it’s becoming a household name among younger, tech-savvy retail investors. In Australia and Southeast Asia, brand awareness is climbing, and local partnerships are expanding reach. The company isn’t the only player in town – Futu is bigger, and IBKR is more established – but Tiger’s edge lies in its regional focus, cultural fluency, and regulatory positioning. That’s enough to carve out a durable niche in a large and growing market.
Would I be comfortable owning this if markets closed for a decade? If Tiger keeps executing the way it has over the last 6–8 quarters, yes. The combination of recurring revenue, capital efficiency, margin expansion, an owner-operator at the helmet, and geographic tailwinds makes it a rare compounder in a space most investors still treat as risky or commoditized. Would I put all of my family’s net worth in it? No – but that’s more about the business still being in an earlier phase of its maturity curve. Give it a few more years of consistent performance, and I might feel differently.
Can Tiger Grow into a Much Larger Business?
Tiger’s past growth story is a bit of a paradox. It was founded in 2014, is Singapore-headquartered today, went public in 2019, and quickly built a loyal user base in mainland China and parts of Southeast Asia. Revenue scaled rapidly in the early years, powered by explosive retail interest in U.S. tech stocks, cheap digital acquisition, and an under-served customer base.
But then came the Chinese regulatory crackdown in 2021–2022. The business was forced to wind down its mainland operations, retool its geographic footprint, and rebuild its narrative. The stock followed that arc: a surge during the Covid retail boom, a collapse as China tightened its grip on capital flows, and now a powerful recovery as the business repositions itself internationally.
The long-term revenue trajectory reflects that detour. Tiger has increased its top-line revenue more than six-fold since going public, but it hasn’t been a smooth ride. There were flat or even negative quarters during the transition out of China. Still, the company has posted record revenues, record profits, and all-time-high client assets in the most recent quarters – a sign that the post-crackdown version of Tiger may be more durable and less cyclical than the pre-crackdown one.
From a stock performance angle, the picture has been volatile. Since IPO, Tiger has underperformed the S&P 500, largely due an overpriced IPO. But in the past 12 months, the stock is up over 240%, handily beating both the S&P – it also outperformed over the last five years (35% outperformance).
That kind of reversal raises a natural question: are we late to the party? Or is the business just getting started?
Looking ahead, I’d argue the growth runway is longer than most investors think. There are three main levers:
geographic expansion,
product expansion, and
operating leverage
On geography, the pivot is well underway. Over 70% of new funded accounts now come from outside China. Hong Kong, Singapore, and Australia are leading the charge – and each of these markets is still underpenetrated. In Hong Kong alone, total trading volume is up 8x YoY and 122% QoQ. The U.S. is next, mostly via its white-label B2B business, which opens up new channels without the cost of direct retail acquisition.
On the product side, the company has broadened its portfolio beyond trading. Wealth management, margin financing, premium data subscriptions, structured notes, and now crypto – all of these represent higher-margin, stickier revenue streams. That’s critical because it reduces the cyclicality of transaction revenue and creates more recurring, predictable cash flow. The move into crypto – supported by recent regulatory wins in Hong Kong – adds optionality and positions Tiger well if digital assets continue gaining institutional legitimacy in Asia.
Can this business 10x? It’s not impossible. The current market cap still doesn’t reflect the full earnings power of a mature, internationally diversified brokerage. But getting there will require a combination of continued execution, modest multiple expansion, and some help from rising client ARPU.
The total addressable market (TAM) is hard to pin down precisely, but if we take a top-down view: Asia’s retail investing population is projected to grow at a healthy CAGR (I couldn’t find exact numbers), with investable assets in the trillions.
A few stats that may serve as supporting evidence here and that I think are worth highlighting:
Asia’s rapidly expanding middle class and wealth base: McKinsey projects that Asia will account for two-thirds of the global middle class by 2030, adding 700 million new middle-class members between 2025 and 2030 – which serves as a strong proxy for retail investor potential.
Projected surge in mass-affluent investors: The Asia-Pacific region is expected to see a significant rise in its mass-affluent segment (investors with USD 100,000–1 million). Their population could grow from ~292 million in 2022 to a much higher threshold by 2030, though exact projections vary.
Source: https://www.pwc.com/sg/en/publications/assets/page/digital-and-wealth-opportunities-in-asia-pacific.pdf?utm_source=chatgpt.com “[Non-USD] wealth is expected to increase from USD 247.8bn in 2020 to USD 811.5bn by 2030, growing at a CAGR of 12.7%” (PwC)
Broader asset growth across wealth segments: HSBC notes that financial wealth in Asia has tripled since 2006 to nearly USD 140 trillion, underscoring the enormity of accumulated investable assets in the region.
Tiger’s TAM could be considered as “the number of people who will invest internationally in the future” – and that number is on a secular uptrend, supported by trends like globalization of finance and technological penetration. There is also a long-term secular trend of Chinese and Asian investors diversifying assets abroad (due to factors like local market saturation, currency hedging, etc.) – Tiger directly benefits from this. So the pie is growing.
Even a 1–2% share of that massive pie could support a business many times larger than today. If we switch to a bottom-up approach, and model growth from current user and asset levels, the numbers are equally compelling – especially if wealth and crypto begin contributing meaningfully to ARPU.
The runway certainly seems very long. Tiger Brokers sits in a very different league compared to the global heavyweights. With about 1.2 million funded customers, it’s tiny next to Schwab’s nearly 38 million accounts, Robinhood’s 27 million, or even regional rivals like India’s Groww with 12 million.
The gap highlights both Tiger’s challenges and its runway: if it can successfully expand its reach beyond its core Chinese and Singaporean base, even modest share gains in large addressable markets could move the needle. What stands out in Asia is that the larger domestic Japanese (Rakuten) and Indian (Groww) brokerages have already scaled into the double-digit millions, showing that the appetite for retail brokerage at scale is there when local product fit and regulatory acceptance align.
For Tiger, this means its current footprint represents an early stage rather than a ceiling. Futu (moomoo), its closest listed peer, has nearly double the clients, suggesting Tiger still has room to catch up within its niche. The broader landscape also shows that smaller brokers in Europe, like DEGIRO and eToro, have broken past the 3 million customer mark, often by combining simple UX with geographic expansion. Trade Republic sits at 8 million accounts across Europe. If Tiger can execute along similar lines – building trust, diversifying beyond China-sensitive flows, and perhaps successfully replicating its tech-driven product in new markets (like in Hong Kong) – the potential runway stretches far beyond its current base.
Tiger’s Serviceable Available Market (SAM) includes digitally native, upper-middle-class investors in jurisdictions where it has regulatory approval – a group that is growing fast and historically underserved. Its Serviceable Obtainable Market (SOM) is naturally even narrower – but it’s clearly expanding. Each new license adds new territory. Each product adds new LTV per customer. And each quarter of positive execution builds brand equity.
Does the company have “spawner” DNA? To a limited but promising degree. Tiger isn’t spinning off new business lines at the pace of Amazon or Sea, but it is actively planting seeds in wealth, B2B brokerage, and crypto. These aren’t random bets – they’re adjacencies that build off the existing user base and infrastructure. And so far, management seems measured and focused in how it deploys capital into these extensions.
Culturally, the company appears product-driven and responsive. R&D employees represent almost half of the total workforce.
Management has consistently reinvested in tech, compliance, and product development. They’re not standing still, but they’re not throwing spaghetti at the wall either. The roadmap has evolved, not pivoted.
“So in regard to labor cost, we will continue to invest in product and R&D to maintain our competitive edge as technology is the core of our platform. At the same time, we will be expanding our team in key markets like Hong Kong and the U.S. and across functions from front office to back office. That being said, our overall head count growth will remain disciplined. We expect compensation expense to grow about 10% to 20% per year.“ - Q1 2025 Call
Part 3: Management
Management Background
When it comes to Tiger Brokers, one of the more reassuring aspects of the investment case is that the founder is still firmly in charge. Ideally, I’d own a portfolio of businesses that are ALL founder-led. In reality, sometimes you make compromises because other attributes like business quality or price make up for the lack of an owner-operator at the helm (in my current portfolio, Ashtead, Evolution, CMG, and Edenred fall into this bucket - 4/10)
40-year-old Wu Tianhua started the company in 2014 and continues to serve as CEO today.
“Mr. Tianhua Wu has served as our Chief Executive Officer, or CEO and director since January 2018. Mr. Wu is the founder and CEO of Ningxia Rongke, which was founded in June 2014. Between 2005 and 2014, Mr. Wu served at Youdao of NetEase Inc., where he was responsible for core search. Mr. Wu has received many honors in the business world. He was awarded “Entrepreneurial Elite under 35” in 2016 and “40 Business Elites under 40 in China” in 2017. He currently serves as a director for Ningxia Haozhong Management Consulting Center LLP and Beijing Yian Management & Consulting Co., Ltd. Mr. Wu obtained both bachelor’s and master’s degrees in computer science and technology from Tsinghua University.“
That matters to me. I like it when the person steering the ship is the one who built it in the first place. It usually means there's alignment between long-term value creation and day-to-day decision-making. Wu’s background is also worth noting. He previously worked at NetEase – a Chinese Internet technology company – as a senior product manager, which explains the company’s early DNA – product-centric, tech-savvy, and user-oriented. He didn’t come out of investment banking or traditional finance. He came out of software.
Mr. John Fei Zeng has served as Chief Financial Officer and Director since October 2018. Interestingly, there isn't a single Chief Operating Officer, as the COO position is held by different individuals within various regional or subsidiary companies of the broader Tiger Brokers ecosystem.
That background gave Tiger a head start in building a platform that felt native to digital-first investors. Wu has been leading the company from day one, through the growth phase, the IPO, and the China regulatory crisis. Since then, Tiger has secured new licenses, expanded internationally, and posted record financials – all under the same leadership. That kind of through-cycle continuity is a positive.
So far, I haven’t found any major red flags around his conduct or capital allocation decisions. There haven’t been accounting issues or signs of self-dealing. And while the company has taken some criticism in the past for aggressive client acquisition tactics in China – a common issue for platforms operating in that environment – it has since adjusted its approach and aligned with regulators in its new core markets. I’ve gone through filings and third-party sources, and nothing has really jumped out in terms of fraud, governance, or credibility.
In 2023, however, Tiger Brokers had to pay $900,000 penalty in New Zealand for breaching the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act 2009, but my understanding is that it is not entirely uncommon to sometimes struggle with keeping up with various compliance requirements.
Wu Tianhua also doesn’t appear to be the kind of flashy founder-CEO who gets distracted by ego-driven side projects. He’s rarely in the press and tends to let the numbers speak for themselves. You won’t find him on CNBC hyping up TAM slides or talking his book on X – he isn’t even speaking English on the earnings call and I couldn’t find an English interview with him. But behind the scenes, you can see the fingerprints of deliberate, product-driven leadership. The business keeps expanding in markets that require serious compliance investment, and in products.
In short, this isn’t a turnaround story handed off to an outside operator from another industry. It’s still the founder at the helm – someone with real skin in the game, a solid operational track record, and a clear understanding of what makes the product work. For me, that’s a box well ticked ☑️.
Can I Trust the People Running This Company?
If there’s one trait I look for in management beyond capability, it’s integrity. Without it, the rest doesn’t matter. In Tiger’s case, I’ve spent a fair amount of time reading the earnings call transcripts. The picture that emerges is one of a relatively quiet, low-ego operator who thinks long term, speaks clearly, and doesn’t spend much time trying to manage Wall Street’s expectations. You love to see that.
As for motivation, it’s pretty clear Wu didn’t start Tiger to make a quick buck. The company was founded in 2014, went public in 2019, and he still holds a meaningful stake today. There have been no signs of overreaching compensation packages, excessive dilution, or insider gamesmanship.
According to the most recent filings, Wu maintains significant ownership – well above the 5% threshold I like to see. According to the annual report, his holdings include roughly 274 million Class A shares – represented in part through ADSs – and the full block of 97.6 million Class B shares. Added together, that comes to about 372 million shares, which works out to an economic interest of around 13% of the company’s total share count of 2.8 billion.
The picture changes dramatically once voting rights are taken into account. While Class A shares carry just one vote each, the Class B shares come with significantly enhanced voting power. Because Wu holds all of the Class B shares in addition to his Class A position, his voting control is nearly 50%, far greater than his economic ownership. This dual-class structure ensures that he retains decisive influence over the company’s strategic direction, even as his percentage of the equity base is diluted over time.
That means his wealth is directly tied to long-term value creation, not quarterly metrics. His incentives are aligned with mine.
One point that often causes confusion when analyzing Tiger Brokers is the difference between the share counts reported in the company’s filings and the figures shown on research terminals. At the company level, the share count is measured in ordinary shares, which total roughly 2.8 billion.
However, the stock trades in the U.S. as American Depositary Shares (ADSs), each of which represents 15 Class A ordinary shares. When you divide the ordinary share count by this conversion ratio, you end up with around 180 million ADSs outstanding – a figure much closer to the 170 million that stock research terminals report.
In other words, both numbers are correct: the larger one refers to the underlying ordinary shares, while the smaller one reflects the tradable ADSs that investors actually buy and sell on Nasdaq.
Tiger doesn’t strike me as a mission-driven company in the Patagonia sense, but there is a clear product vision behind the business: lower friction for cross-border retail investors, delivered through a sleek, compliant, and accessible platform. And the way the company continues to reinvest in R&D, expand into new regulated markets, and layer on new services shows that this isn’t a growth-at-all-costs story. It’s a methodical push to build a durable financial platform that will still be relevant a decade from now.
In terms of compensation structure, all I could find in the 20-F filing is this:
“In 2024, we paid an aggregate of RMB2.3 million (US$0.3 million), HKD1.3 million (US$0.2 million) and US$0.2 million in cash to our executive officers and directors, and US$0.2 million to our non-executive directors.”
There’s nothing egregious in terms of cash compensation, but I’m sure management is also compensated handsomely via share packages. If you can point me to more information in this regard and also the underlying compensation incentives, this would be much appreciated.
I did notice that Wu Tianhua trimmed the number of shares he owns between the 2023FY and 2024FY quite significantly from 468k class A shares to 274k shares. That’s not an immediate red flag, but it stood out to me, it’s not particularly confidence-boosting, and I’d like to better understand what was driving this decision.
There’s also no evidence of empire-building behavior – no splashy M&A, no rapid-fire diversification for the sake of headlines. Each step in the strategy has made sense in light of what came before.
Overall, all of this leads me to believe that Tiger is run by people who care more about the business than the optics. Wu isn’t trying to be a celebrity CEO. He’s trying to build something that lasts. That quiet, focused leadership style won’t make headlines – but it gives me confidence that capital will be allocated rationally, growth will be pursued responsibly, and shareholder interests won’t be trampled in the process.
Are They Putting Capital to Work the Right Way?
The easiest way to gauge whether a management team understands capital allocation is to ignore what they say and look at what they’ve done. So that’s what I did with Tiger.
Let’s start with the basics: this is a company that’s never had access to the luxury of infinite capital. It wasn’t a venture-backed unicorn throwing around $100 million at moonshot ideas. In total the company raised around $140 million over seven funding rounds.
So from the beginning, Tiger has had to be disciplined. And that’s actually been a blessing. You see it in how the company prioritized product buildout and regulatory licensing over expensive marketing early on. You see it in how the business scaled its fixed cost base only when there was visibility on revenue leverage. And most clearly, you see it in how the company responded to the China regulatory crackdown. They didn’t double down on a crumbling core. They pivoted internationally
I haven’t done a proper ROIIC analysis yet, but simply judging by the deveopment of net income over time, I have no doubt the return earned on R&D, marketing, and infrastructure investments was MORE than satisfactory. And they started laying the foundation for a more sustainable model.
Tiger likely ran below 15% ROIC in its early growth phase because the underlying earnings power wasn’t fully developed and showing. That’s not a surprise for a company still building out its core (infrastructure). But over the last two years, the return profile was improving tremendously – which does mean early investments didn’t generate great returns. No, it just took time for the returns to become visible.
Margins are rising, revenue per user is climbing, and incremental earnings are flowing through at a faster clip. Incremental margins are exceptional (>50%). Every new dollar spent on client acquisition or product expansion seems to be earning more than the dollar before.
The company’s focus and reinvestment priorities are also clear. First, they’ve been doubling down on international licensing – essential to future growth. Second, they’ve expanded into adjacent verticals like crypto and wealth management, which add ARPU without adding disproportionate risk or complexity. Tiger is methodically trying to deepen monetization per user. And that’s the kind of capital allocation I like – fairly easy to predict, quiet, logical, compounding.
What’s the reinvestment rate? The conpany doesn’t currently pay a dividend, and share repurchases have been minimal (only in 2020, a tiny amount, but at least made at attractive prices). The lack of direct profit distribution makes sense at this stage of the business in my view.
“On March 25, 2020, the Company’s Board of Directors approved a share repurchase program. Under the terms of the approved program (“Share Repurchase Program”), the Company may repurchase US$20 million worth of its outstanding ADSs from time to time for a period not to exceed twelve months. As of December 31, 2023 and 2024, an aggregate of 10,429,305 ordinary shares under the Share Repurchase Program has been repurchased in the open market, with an average price of US$3.13 per ADS, or US$0.21 per share for a total consideration of US$2.2 million.“
Given that CapEx and acquisitions remain modest, and most spending goes toward product, compliance, and customer growth, I expect all/most of profits to be reinvested internally – often at attractive incremental returns.
And with margin expansion kicking in, there’s a flywheel forming.
Lastly, if I look at how Tiger talks about its business, there’s a clear customer-first bias. Product improvements are always highlighted before growth metrics. Regulatory compliance and platform reliability come before monetization updates. The company knows that trust and ease-of-use are the currency of long-term brokerage success, and they’re investing accordingly. They’re not outbuilding competitors just to show off. They’re solving actual pain points – like multi-currency access, mobile onboarding, and language localization – that matter to their users.
If I had to summarize it: Tiger’s management team may not be flashy allocators – again, you can hardly find any interview with management –, but they strike me as rational capital allocators.
They’ve shown restraint when needed, moved aggressively when appropriate, and consistently reinvested in areas that actually improve the core economics of the business. That’s not always easy to find in tech-driven finance. And it gives me confidence that as the company scales, the capital will continue to be put to work in ways that matter.
Part 4: Balance Sheet & Debt
Valuing brokerage businesses like Tiger Brokers (UP Fintech) requires a bit of nuance, because their balance sheets are filled with items that don’t really belong to the company. Hence, for a long time, I’ve avoided the financial sector entirely … until I came across IBKR, which arguably is more of a tech company with a unique culture focused on maximizing efficiencies. I later added Wise. And now I’m studying Tiger.
For example, on June 30, 2025, Tiger reported over $5.2 billion in payables to customers and another $2.3 billion payable to brokers and clearing firms. At first glance those numbers look like huge liabilities, but in reality they simply reflect client cash and settlement balances flowing through the business. They don’t represent debt Tiger can deploy or risks it has taken on its own balance sheet.
What are Payables to brokers, dealers and clearing organizations? This line item reflects amounts owed to counterparties in the process of clearing and settling trades. When a client buys securities on Tiger’s platform, Tiger often fronts the trade and then needs to deliver cash to a clearing broker or market maker. Until settlement (typically T+2), that cash is owed and sits as a payable. Conversely, when clients sell securities, Tiger may temporarily hold receivables from brokers until the cash arrives.
So this liability isn’t the same as the company borrowing money – it’s essentially in-transit cash flows from customer transactions. The size of the line item swings with trading activity, client margin balances, and timing around settlement cycles. For a fast-growing brokerage like Tiger, it’s normal to see large figures here, but they don’t represent long-term funding or leverage risk. They’re more like working capital mechanics tied to the brokerage function.
When we strip out these customer-related items, the picture is much cleaner. As of June 30, 2025, Tiger’s only meaningful financial debt is a single line item: $160.8 million in convertible bonds, now classified as current since they’ve rolled closer to maturity. Add in about $13.7 million in lease liabilities, and the company’s total debt load is just under $175 million. That’s a fraction of what the raw balance sheet totals ($7.8 billion) might suggest at first glance.
On the asset side, Tiger holds $511.9 million in unrestricted cash, far more than its debt. Netting the two leaves the company with a net cash position of around $337 million. With a market cap of $2.2 billion, this means Tiger’s enterprise value actually comes in below its equity value.
In fact, Brokerage businesses typically tend to keep a meaningful cash cushion on their balance sheets. Unlike most companies, brokers sit at the center of enormous daily money flows, where timing mismatches and counterparty risk can easily stress liquidity. Having excess cash isn’t a luxury – it’s basically a requirement. For Tiger, this means that while enterprise value technically nets out to less than equity value today, it’s probably best to use market cap as the cleaner, maybe somewhat conservative proxy. The company also needs to keep building its cash reserves if it wants to continue reducing reliance on Interactive Brokers for clearing and margin lending. That cushion isn’t just about risk management; it’s the price of admission if Tiger wants to step up and operate at the same level as the industry’s leaders.
Interactive Brokers provides a useful playbook here. Management has long been vocal about how a fortress balance sheet is part of its value proposition, especially for institutional clients and hedge funds. CEO Milan Galik has been clear on this point:
“The fortress balance sheet is something that we really enjoy. We believe that it attracts the institutional clients.”
Founder Thomas Peterffy has echoed the same idea, recalling that in 2008, when most financial institutions were scrambling for Fed lifelines, IBKR still had over $4 billion in cash on hand. In his words, holding that cash was critical not only for safety, but for building credibility with large investors who needed reassurance that their funds were truly secure.
While most companies see idle cash as a drag on returns, IBKR reframes it as a growth engine in its own right. The reasoning is simple: in times of stress, investors and institutions gravitate toward the safest counterparty. By being the broker with the strongest balance sheet, IBKR wins business when others falter. It’s a strategy that looks conservative on the surface but has proven to be deeply competitive. Other companies built on similar principles include Berkshire Hathaway and JPMorgan – firms that have turned financial strength into a business advantage, not just a defensive shield.
If Tiger aspires to replace IBKR as the clearing house of choice or a reliable source of margin financing, it will need to follow the same philosophy. Building up a larger cash base and maintaining a fortress-like balance sheet isn’t optional; it’s the only way to convince institutional investors that they can safely move significant assets onto the platform. In that sense, the path forward for Tiger is clear: balance sheet strength has to be treated not as a drag on returns, but as an investment in the company’s long-term positioning.
Is Tiger’s Balance Sheet a Weapon or a Weak Spot? A Closer Look
When I looked into Tiger’s balance sheet, what stood out wasn’t just the lack of debt – it was the flexibility. That might not sound exciting at first, but it matters a lot when you're building a business in highly regulated, capital-sensitive markets. As just discussed, you want a balance sheet that buys you time, optionality, and resilience. And Tiger has that.
Let’s start with leverage. The company has minimal financial debt. Most of the liabilities on the balance sheet are client-related – cash and margin positions, which come with the nature of the brokerage model. There’s no sign of dangerous short-term borrowing, no large chunks of debt coming due in the next year, and no dependence on rolling over liabilities just to survive.
If you annualize the H1 EBT of around $88 million, Tiger could easily pay back its debt – well below the 3–4x FCF/profit threshold I use as a sanity check.
There’s been no indication of balance sheet stress in recent quarters. No goodwill write-offs, no asset impairments, and no sudden drawdowns in cash. Cash and equivalents have remained pretty stable over time and have in fact risen more recently.
The most notable development in the quarter was the provisioning for a client-related loss in Hong Kong. This was tied to a legacy stock pledge business that has already been discontinued and should be viewed as a one-off event rather than a structural weakness.
“The adjustment follows UP Fintech's second-quarter non-GAAP net profit report, which showed a significant decline both quarterly and year-over-year, coming in at $5.2 million—a 65% drop from the previous quarter and a 66% fall from the same period last year.
The decrease in net profit was largely attributed to a one-time provision of $13.2 million made for a legacy stock pledge business in Hong Kong, which was discontinued in 2023. UP Fintech, also known as Tiger Broker, has written off the troubled exposure in the second quarter.
This action was taken despite an undisclosed client's agreement to repay the loan fully by the end of 2025, with the client's controlling shareholder providing a repayment guarantee, which could potentially lead to a writeback of the provision in the future.“ – Source: Investing.com
Management flagged the issue clearly, quantified the impact, and addressed it head-on in the earnings call. While the hit to net profit is unfortunate, it does not point to deeper instability in the business.
Intangibles and goodwill account for a very small percentage of total assets – another green flag. This isn’t a company built on acquisition-fueled growth or asset revaluation games. What you see on the balance sheet mostly reflects the core operating engine. There's no bloated M&A trail. And that lack of goodwill also reduces the risk of sudden impairments that would otherwise cloud earnings quality or trigger covenant-related issues.
If there’s one thing I watch closely, it’s the liability mix tied to customer balances. Brokerages always carry some risk from the client side – particularly when margin is involved. But Tiger’s balance sheet shows disciplined risk controls, a high level of regulatory compliance capital, and no signs of overreach. Compared to peers that lean more aggressively into margin or structured product risk, Tiger runs a relatively conservative book.
So if I had to sum it up: Tiger’s balance sheet is solid. It gives the company room to maneuver, confidence to keep investing in expansion, and a buffer against downturns. In a sector where access to capital can dry up quickly, that’s not just a nice-to-have. It’s a strategic asset.
What Does the Balance Sheet Say About How This Business Works?
When I look at Tiger’s balance sheet with a specific focus on understanding the business, the thing that jumps out isn’t what’s there – it’s what’s missing. There’s no inventory. No PP&E to speak of. No warehouses, factories, or physical assets dragging down returns. That absence tells you a lot about what kind of business this really is.
Tiger runs a capital-light model. It builds software, operates digital infrastructure, and earns revenue through commissions, interest income, and fee-based services layered on top of a core trading experience.
That setup naturally translates into a clean, low-friction balance sheet. The bulk of the assets sit in cash, short-term investments, and client-related balances. That’s exactly what I’d expect from a brokerage platform operating in multiple regulated markets.
One of the most significant line items is receivables from clients, which mostly reflects unsettled trades and margin financing. This isn’t a red flag – it’s just a function of the business model. When a client places a trade or takes on leverage, there’s a brief lag before settlement or repayment, and it shows up here. The important thing is that these receivables are generally short-duration, well-secured, and matched by liabilities on the client side. There's no evidence that Tiger is taking on excessive counterparty risk or stretching terms in ways that would distort the cash conversion cycle.
There are no inventories, no deferred revenues, and no major build-up of prepaid expenses. That simplicity reflects a transaction-based, real-time service model – revenue is earned as services are provided, and costs are largely tied to platform operations, compliance, and R&D. It also means that the cash conversion cycle is minimal. Tiger doesn’t need to front-load working capital or wait long to realize cash from revenue. This keeps operating cash flow clean and responsive to business momentum.
There’s also no mismatch between the company’s operating model and its asset base. Everything lines up. This isn’t a firm that claims to be a lean SaaS-like platform but carries hidden capital intensity. There are no physical distribution channels to support, no inventory buffer to maintain, and no asset-heavy infrastructure. What little CapEx exists is mostly related to software and systems upgrades.
So what does all this tell me about the business? That it’s capital light and designed to scale. The low capital intensity, combined with short working capital cycles and a clear asset structure, gives Tiger flexibility. It doesn’t need to deploy large amounts of capital to support every additional dollar of revenue. That’s the kind of operating leverage I look for in a compounding story – and the balance sheet confirms it.
Part 5: Risks – What Could Go Wrong?
I always ask myself: someone is selling this stock to me. What do they know that I don’t? Why is this opportunity still on the table after a 240% run in twelve months?
So every thesis needs pressure-testing. For Tiger, that means looking beyond the clean financials and clear growth story, and asking: what could derail this? Which risks are temporary? Which are structural? And which could wipe out the equity entirely? I’ve identified a couple of risks. Let’s go through them one by one.
1) Regulatory Risk
Let’s start with the obvious one – regulation. Tiger operates in one of the most heavily regulated verticals in global finance: cross-border securities brokerage. It deals with clients in multiple countries, moves money across jurisdictions, and increasingly touches crypto and wealth management products. The potential for regulatory shifts that damage the business model is real. We’ve already seen this happen once: China cracked down on offshore brokers and effectively kicked Tiger out of the market. To its credit, the company pivoted and is now thriving elsewhere. But that doesn’t mean it’s immune.
In markets like Hong Kong, Singapore, and Australia – all now core growth drivers – Tiger depends on regulatory goodwill, and keeping up with all the local regulatory changes is a nightmare from a compliance point of view. We’ve already discussed the 2023 $900,000 penalty in New Zealand for breaching the Anti-Money Laundering and Countering Financing of Terrorism (AML/CFT) Act 2009.
A tightening of investor protection rules, a clampdown on crypto access, or pressure on cross-border flows could force the company to adapt again. Regulation is slow to change until it suddenly isn’t. It’s hard to know in advance where these shifts will come from, but when your entire monetization model relies on platform access and licensing, the regulator becomes the gatekeeper. So while the company has de-risked China, it hasn’t de-risked regulation altogether.
2) Competition
Next up is competition – particularly from Futu, which remains the more profitable and better-known peer: around 2.4 million paying clients and roughly US$124 billion in client assets versus Tiger’s 1.15 million funded accounts and US$52 billion. Its net margin also runs higher – about 48% compared to Tiger’s ~30%.
If Futu chooses to push harder in Tiger’s growth markets, the impact could be material. Both companies now compete most directly in Singapore and Southeast Asia, which account for about half of Tiger’s new funded accounts and where moomoo already ranks among the top-downloaded finance apps.
The second major overlap is Hong Kong and Greater China, responsible for about 30% of Tiger’s new accounts but still Futu’s core market with the deepest client asset base.
“With more players to enter [the Hong Kong market] simply highlights the long-term potential of this market. From our perspective, increased competition is a good thing for local users and raise the bar for the entire industry and encourages all of us to keep improving.
As a tech-driven brokerage, Tiger has already built strong barriers across different key areas. This includes our clearing efficiency for Hong Kong and U.S. equities, a robust product set, especially in the U.S. derivatives, virtual asset trading capabilities and the deep integration of AI in the investment process, all of which set us apart.“ Q1 2025 Call
A further 15% of Tiger’s inflows come from Australia and New Zealand, where Futu has also been scaling trading volumes. Even in the United States, a smaller market for Tiger at roughly 5% of new accounts, Futu has been adding features like moomoo Crypto and capturing more share.
Beyond this head-to-head footprint, Futu has also moved into Japan, Canada, and Malaysia and I believe has local licenses – apparently, Tiger is providing services to these markets with their international licenses too, but didn't begin to market itself yet. I’m not entirely sure regarding this though – maybe this gives a clue:
“We had also obtained trademarks in jurisdictions such as Hong Kong, Singapore, Malaysia, EU, Indonesia, India, Philippines, Thailand, Australia and New Zealand, and submitted trademark applications in various jurisdictions.“ - 2024 annual report
The threat isn’t only from Futu. Revolut already offers stock trading in Singapore, while global brokers like Schwab and IBKR keep broadening their international access (and IBKR’s white-label solutions make it fairly easy to set up a new brokerage business), and regional banks such as DBS continue to fold investing into digital banking suites.
Tiger’s product set overlaps heavily with peers – multi-market equities, options, funds, IPO access – so differentiation is incremental at best. Its AI tools are interesting, but Futu counters with features like a virtual-asset toolkit. Switching costs are low-to-moderate; account transfers between brokers are possible, though fees and delays add friction. That makes user experience, pricing, and brand trust the key battlegrounds; we’ve discussed this in-depth in the competitive advantage segment. In a direct pricing war, Tiger would start at a disadvantage, given Futu’s scale and broader international reach.
3) Customer Risk
The third major category is customer fragility. Tiger’s client base consists mostly of retail investors in Asia-Pacific – often first- or second-time investors, mobile-first, and, at least initially, relatively low asset size per user (we discussed how this is changing).
In bull markets, these users tend to be highly active. But in sustained downturns or periods of low volatility, engagement can drop off. If that happens, revenue from commissions, margin financing, and FX conversion all shrink. This is a business that, while increasingly diversified, is still tied to sentiment-driven activity.
It is worth pointing out that there is the possibility that Tiger’s recent record results are being flattered by a market cycle rather than by purely structural improvements. China’s total stock turnover just hit a record ¥3.1 trillion – the second-highest level on record – a sign of intense retail activity and, arguably, full-blown FOMO in local markets. High-frequency bursts like this often inflate brokerage volumes and commission income, but they’re notoriously short-lived. I wouldn’t be surprised if, on a multi-year basis, compounded growth from the current levels will be a little more “muted.”
If what we’re seeing is a cyclical frenzy rather than a sustainable trend, then the revenue and profit figures Tiger is printing today may represent near-term peaks. That possibility may explain why the market, despite the company’s impressive results, is still unwilling to assign a higher multiple (more on this soon). Investors are asking: is this normalized earnings power, or just a sugar high?
The income statement highlights why this matters. In the most recent quarter, commissions accounted for nearly $65 million of revenue, while interest-related income added another $58 million. Together, those categories represented well over 90% of Tiger’s net revenues. Both lines – but of course especially commission revenue – are activity-driven. Trading commissions are directly tied to volumes, while interest income depends on margin financing and idle cash balances – themselves a function of both turnover and average account sizes. In a hot market, both spike. In a flat or declining one, they fall just as fast. That leaves the business exposed to cyclicality at the exact moment it’s trying to prove it has transitioned into a more predictable, higher-quality platform.
This is why the composition of the customer base and the growth in average account sizes matter so much. Bigger, wealthier clients bring in more stable interest income and are more likely to use wealth products, and subscriptions. That makes revenue less dependent on trading spikes. But today, Tiger is still tilted toward activity-driven retail flow. Until product diversification meaningfully shifts the revenue mix, the company will be riding the waves of market turnover cycles. That doesn’t mean the business can’t compound – it can – but it does mean I have to be careful not to overextrapolate current growth rates and peak results or mistake temporary tailwinds for long-lasting structural ones.
Finally, from a consumer point of view, the bear case might focus on low switching costs and weak user stickiness. Yes, funded accounts are growing, and yes, ARPU is rising – but what if that turns out to be fragile? The platform isn’t deeply embedded in a user’s financial life the way a payroll service or insurance product might be. It’s still transactional. If a better app comes along, users might leave. If that happens, everything – growth, margin expansion, optionality – becomes a lot harder to underwrite.
4) Interest Rate Sensitivity?
There’s also macro sensitivity. Currency risk is one part of this. Around 70% of Tiger’s revenue comes from outside the U.S., and although its books are USD-reported, it operates in markets where FX volatility can distort reported earnings.
Another variable I keep in mind is interest rates. The current environment has been unusually (measured by more recent historical standards) supportive for Tiger’s net interest income, which benefits from the spread it earns on idle client cash and margin balances. But that tailwind might not last forever. A rate-cutting cycle could hurt that revenue stream. Moreover, a weakening of Asian economies – or a financial shock in any of Tiger’s key hubs – could trigger asset outflows or lower trading volumes."
Management helped us quanity the impact on the Q1 2025 call: for every 25-basis-point cut by the Federal Reserve, quarterly net interest income would fall by roughly $1–1.5 million, or about 1% of revenue.
“As for the impact of future rate cuts, we estimate that for every 25 bps cut by the Federal Reserve, our quarterly net interest income would be negatively impact by about like $1 million to $1.5 million. which is about roughly 1% of our quarterly revenue.”
That said, studying Interactive Brokers taught me an important dynamic of brokerage businesses: lower rates don’t automatically translate into worse economics. Yes, interest income takes a hit, but rate cuts are often accompanied by rising stock markets, easier financial conditions, and more trading activity. In other words, there’s a natural hedge. Tiger is also diversifying its funding mix – rolling out debit-linked cash tools, optimizing its asset-liability management, and adding new yield products – which should soften the drag if rates decline. And given its presence across multiple markets, the impact is never uniform; different central banks move at different speeds.
The risk is if these cushions don’t show up. Retail trading activity already looks frothy, with Chinese turnover hitting record highs. If trading volumes fall at the same time as interest income shrinks, Tiger could face a double whammy that pressures both the top and bottom line.
I don’t expect us to go back to a zero-interest-rate environment, but with U.S. monetary policy becoming politicized and the Fed’s independence increasingly in question, it’s hard to fully rule anything out.
5) Structural Risk?
From a structural risk angle, I don’t see concentrated customer or supplier exposure. The business is broadly diversified across thousands of retail clients and relies on a few key tech and clearing partners – notably Interactive Brokers. That dependency is worth watching, and Tiger is actively working towards reducing it; and generally, it’s not unusual for a brokerage to lean on a clearing partner. So long as the relationship remains stable, I don’t view it as a major liability.
6) VIE Structure?
Another point that often comes up – and one you can’t miss when you flip through the annual report – is the VIE structure. The first forty-some pages read like a warning label. They spell out, in excruciating detail, the risks of investing in a PRC-linked company through a Cayman Islands holding structure.
The VIE model has been one of the biggest sources of fear for foreign investors in Chinese ADRs. You don’t technically own the underlying operating entity. You own a claim on a Cayman-registered entity that has contractual rights to the economics of the onshore business. If the Chinese government ever decided to invalidate those arrangements, foreign shareholders could, in theory, be left with nothing. That’s the nightmare scenario the risk factors are designed to hammer home.
So is that a wipeout risk here? I don’t think so. For one, Tiger has already wound down its mainland China operations – the piece of the business where VIE arrangements actually mattered most. The growth engines today are Hong Kong, Singapore, Australia, and other regulated international markets where the VIE discussion is largely irrelevant. Second, I don’t buy into the view that Beijing is looking to nuke the entire ADR ecosystem by retroactively stripping foreign investors of rights. They want capital inflows, not capital flight. Yes, they’ll tighten controls in specific sectors (education in 2021 was the prime example), but the notion of voiding every VIE contract overnight feels more like a theoretical tail risk than a realistic probability.
That doesn’t mean I dismiss the language in the filings – clearly it’s there for a reason, and regulators want investors to understand the framework. But when I weigh this against the actual operations of Tiger as it exists today, it doesn’t worry me in the same way it might for a company still heavily reliant on PRC-based assets. I don’t lose sleep over the fact that my ownership piece is technically in a Cayman Islands entity. What matters to me is whether the economics of the business flow through cleanly – and so far, they do.
I will also link you to this panel discussion from Rob Vinall’s annual gathering earlier this year, discussing if China is “investable”:
7) Dilution Risk
One risk that’s easy to underestimate with Tiger is dilution. The share count has steadily crept higher over the last several years, and the scale of the incentive plans means this isn’t going away anytime soon. Here’s a look at the trend in diluted weighted average shares outstanding:
This is not an extreme explosion, but the cumulative effect is clear – diluted shares are up more than 55% since 2019. And the company’s share incentive programs set the stage for more.
The 2018 Share Incentive Plan was expanded from 187.7 million to 254.7 million Class A shares.
“In June 2018, our board of directors approved the UP Fintech Holding Limited Share Incentive Plan, or the 2018 Share Incentive Plan, to attract and retain the best available personnel, provide additional incentives to employees, directors and consultants, and promote the success of our business. The 2018 Share Incentive Plan consists of a share incentive plan for our service providers. The original maximum aggregate number of Class A ordinary shares that could be issued pursuant to all awards under the 2018 Share Incentive Plan was 187,697,314 Class A ordinary shares, which was increased to 254,697,314 Class A ordinary shares by the amendment thereto in December 2018.”
The 2019 Performance Incentive Plan added another 52 million, later topped up by 10.4 million from buybacks, and now includes an “evergreen” feature that automatically increases the pool by 1.5% of total shares each year, provided the reserve stays below 10% of outstanding shares. As of March 2025, the aggregate maximum across the plans was 568 million shares, with more than 413 million already issued or granted. The math is straightforward: Tiger has a lot of stock-based comp to push through the system.
“In March 2019, we implemented the 2019 Performance Incentive Plan (the “2019 Plan”), which was approved by our board of directors to grant a maximum number of 52,000,000 ordinary shares under the 2019 Plan, to attract and retain the best available personnel, provide additional incentives to employees, directors and consultants, and promote the success of our business. In December 2020, the Company’s board of directors approved amendments to the 2019 Plan adding an additional 10,429,305 ordinary shares for issuance under the 2019 Plan, which were obtained through the Company’s share buyback plan. In May 2021, the Company’s board of directors approved an evergreen option plan which is to increase Class A ordinary shares to the Plan each year starting from 2021 in an amount equal to 1.5% of the total issued and outstanding shares as of December 31 of the immediately preceding year (“Evergreen Option”), and continuing as long as the unissued shares reserved under 2019 Plan account for less than ten percent (10%) of the total then issued and outstanding shares. The 2019 Plan consists of a share incentive plan for our service providers. The maximum aggregate number of Class A ordinary shares that could be issued pursuant to all awards under the 2019 Plan and 2018 Share Incentive Plan was 568,287,985 as of March 2025 (not accounting for future increases under the Evergreen Option) and the Company issued 413,432,187 Class A ordinary shares to the Plans as of March 2025. As of March 31, 2025, 359,939,736 Class A ordinary shares have been granted, excluding awards that were forfeited or cancelled after the relevant grant dates. In addition, as of the date of March 31, 2025, options to purchase 200,730,744 and 23,297,416 Class A ordinary shares have been granted and are outstanding, along with 233,101,847 and 86,840,537 restricted share units have been granted and are unvested.”
On top of that, there was an outright equity raise in late October 2024 – 17.25 million ADSs, each representing 15 Class A ordinary shares, for gross proceeds of about $110 million.
That offering added another layer of dilution at the common shareholder level. Management’s rationale was to shore up capital for expansion, and given where the company is in its growth cycle, that’s not out of line.
So how do I think about this? Dilution is real, and it’s a headwind that trims per-share growth. But Tiger is still a relatively young company, sub–$3 billion market cap, and my experience with these kinds of businesses is that if the runway is large enough, they more often than not will grow out of the dilution problem. In other words, if Tiger keeps scaling revenue and earnings at a double-digit clip, dilution becomes noise rather than thesis-breaking.
Still, it’s something worth tracking closely. If the company leans too hard on its evergreen plan or continues to issue equity at inopportune times, the compounding math for shareholders weakens fast. For now, I’m treating it as a manageable, but persistent, drag.
8) AI Disruption Risk?
Is there disruption risk from AI or technological change? Not immediately. Brokerage, unlike content or design, isn’t a segment where AI easily replaces the core service. But AI could enable new forms of wealth management, advisory, or pricing – and if competitors move faster on that front, Tiger could lag. The company is clearly investing in tech and product, but the speed of innovation in fintech is unforgiving. Even a short period of stagnation can open the door to fast-moving competitors.
9) Dual-Class Share Structure
Another governance risk worth addressing is Tiger’s dual-class share structure. Like many Chinese ADRs, the company has split its equity into Class A and Class B ordinary shares, with Class B carrying 20 votes per share versus one for Class A.
As of March 31, 2025, founder Tianhua Wu and his family owned all the Class B stock, representing only 3.5% of the total share capital but controlling over 43% of the voting power. That gives him effective veto rights over any major corporate action – mergers, director elections, strategic pivots – and significantly limits the influence of ordinary shareholders. The annual report is blunt about this: such control could prevent a change of control transaction or deprive ADS holders of a takeover premium.
I’ve written about this before, and my view hasn’t changed: founder control is both a source of risk and strength.
On one hand, investors are surrendering governance influence. If Wu were to make a series of poor capital allocation decisions or entrench himself against better strategic options, there’s little minority shareholders could do. On the other hand, concentrated founder control can be exactly what keeps a company focused on the long game rather than chasing quarterly numbers. It gives Tiger a degree of stability in direction – and given Wu’s track record of navigating the China crackdown and repositioning the company internationally, I lean toward seeing that as a positive.
This tension is captured beautifully in a passage I recently came across taken from Lululemon and the Future of Technical Apparel by Chip Wilson. He argues that once founder-owners step aside, companies often lose their edge:
“[…] they re trying to cram too many ideas into a small store, or building impersonal mega stores. Is Lululemon a streetwear brand? An athletic brand? An accessories brand? Their stores look like Disneyland with all those keychains and other trinkets, which have nothing to do with athletics. It cheapens the brand experience. As a result, their original core customer doesn't bother to stop by anymore.
For lululemon, the fundamental problem is that there's no longer a founder-owner on the board. They need someone who lives five years in the future—who can give customers what they don't know they want yet, by taking that 20 percent risk on ideas that push the envelope. Lululemon's stock has dropped so much because the board is numbers-driven and there's nobody looking after the creative side. All they care about is Wall Street.
In that sense, Lululemon has followed the same arc as many other entrepreneur-owned businesses that became mature public companies. Along the way, they lose sight of the fact that for any brand, only half of its value is financial. The other half is the subconscious feeling that brand creates for the customer.
With Lululemon now, it's all about delivering a low-cost product at the highest price—and maximizing sales so management and buyers can get their bonuses. The folks in charge of building out stores are bonused on how quickly and cheaply they can open them. So they've moved to steel fixtures, budget racks, budget everything. That way, they can find a location, paint it white, and get the place up and running in about two weeks.
Also, because the merchants get a bonus on margin, their goal is to make cheaper stuff and charge a higher price. That inevitably results in the wrong product for the customer—an acrylic sweater with no good reason to be in the store, or a button-down, collared shirt that nobody on the West Coast would wear. A store that used to be 80 percent athletic apparel is now 20 percent athletic—at best. The remainder is everyday clothing with a lululemon logo slapped on it.
Thanks to those missteps, Lululemon is losing its premium position to athletic brands like Alo and Vuori. Those retailers have followed Aritzia's lead by opening beautiful, thoughtfully laid-out stores that could be someone's living room, with wood and rugs and good lighting. Lululemon has none of that style and elegance anymore. It's basically the Gap from 1998.”
The point resonates: removing the founder from the driver’s seat can make companies safer in a corporate-governance sense, but often weaker in terms of vision and culture. With Tiger, I’d rather have Wu firmly in control than a “professional” board trying to optimize for quarterly EPS. Yes, it concentrates risk. But it also preserves the entrepreneurial DNA that built the business in the first place.
10) Portfolio Correlation
Lastly, I think about correlation to other holdings. If your portfolio is already heavy in fintech, emerging markets, or sentiment-driven platforms, Tiger adds to that concentration. On the other hand, if you’re underweight Asia or looking for idiosyncratic stories in capital-light financial infrastructure, this can actually act as a diversifier.
If this stock underperforms over the next few years …
If this stock underperforms over the next five to ten years, I think the headline reason will be this: “Tiger failed to build a durable advantage in a market that commoditized faster than expected.”
That would likely be paired with either slowing user growth or a surprise regulatory clampdown in one of its key markets. Either would stall the story, compress the multiple, and challenge the entire thesis.
There’s also the possibility that I’m rationalizing the pace of improvement. I see operating leverage, rising margins, expanding TAM – and I assume the trend continues. But trends don’t always continue – and certainly not linearly. Growth could plateau. CAC could rise. Crypto could turn out to be a sideshow. I might be overstating how much latent value is actually in the customer base.
So no, this doesn’t feel “too good to be true.” But it does require trust in a company that is still proving itself. The shift away from China has been handled well so far, but it’s still recent. The wealth and B2B verticals are promising – but still early. And the long runway I see could turn out to be a mirage if macro conditions tighten, fintech sentiment sours again, or incumbents start defending their turf more aggressively.
Would I short this company if I had to pick one name in my portfolio? Probably not. The fundamentals are improving, not deteriorating. But it’s also not the kind of business I’d bet my house on. It has more moving parts, more exposure to regulation and customer inertia.
What this exercise reminds me is that even good businesses can fail if they don’t build enduring competitive advantages. Tiger is getting better. But it still has to earn its place in the long-term compounder category – and that’s why I’ll keep watching it quarter by quarter, license by license, cohort by cohort.
"False Moat” Analysis – Could I Be Fooling Myself About the Moat?
Overestimating the strength of competitive advantages is the number one mistake I’m trying hardest not to make. Tiger’s business looks stronger with every quarter, but when I strip away the numbers and try to understand what’s defensible from a qualitative point of view, things get a little murkier.
Let’s start with the regulatory angle. Tiger has spent years building out its licensing stack – Hong Kong, Singapore, Australia, the U.S. That infrastructure is not easy to replicate overnight. But it’s not a permanent advantage either. Regulators don’t grant exclusive rights. A company with enough capital and patience can work its way through the same approvals, especially in jurisdictions that welcome fintech competition. Even worse, a jurisdiction that was open yesterday might tighten access tomorrow. The playbook already played out in China. It’s not hard to imagine a softer version repeating elsewhere. So yes, Tiger has a head start. But the question is how long that head start holds before others catch up.
I also want to be careful not to confuse brand familiarity with brand equity. Tiger is known. But does the brand actually create willingness to pay more? Or even willingness to stay? I don’t see it. This isn’t a prestige product. Search costs are reduced, though.
Tiger’s platform is a tool. Customers use it because it’s functional and localized and works better than the alternatives. If someone builds something equally frictionless with better pricing or smoother crypto integration, users might jump. There's little emotional attachment here. Recognition, yes. Affinity? Not really.
Switching costs? Some, but not decisive. There’s friction in moving money, but it's not a deep integration the way you’d see in enterprise software. It’s not SAP. Most users aren’t locked in. They can, and some (or many?) do, multi-tenant – i.e. they have multiple brokerage accounts. So while there’s a degree of stickiness, it feels more like inertia than true lock-in.
There’s no real network effect either. More users don’t create more value for other users. The platform doesn’t get better the more people are on it. Maybe in the sense that Tiger will be enables to lower fees. But it’s not a marketplace or a social graph.
Cost advantages are limited, too. Tiger doesn’t operate at a scale where it can underprice everyone else. Not yet at least. Interactive Brokers is cheaper on most trades. Futu runs a more profitable operation. Tiger is lean, but that’s not the same as structurally advantaged. If someone better-funded decides to compete aggressively in the same markets, Tiger can't win on price alone. So any assumption of a defensible margin lead needs to be taken with a grain of salt.
The risk here isn’t that the moat doesn’t exist at all. It’s that it’s too early to call it a highly defensible one. A lot of what looks like edge might just be sequencing: Tiger moved earlier, executed better, and hasn’t hit a true competitive stress test yet. And until it does, I need to treat every advantage as temporary. I like where the business is going. I like the founder. I like the trajectory. But I’m not going to dress up a few good quarters in a new market and call it a fortress. Not yet.
Part 6: Other Relevant Items?
I always take a quick look at who’s on the cap table. Not because I want to outsource conviction, but because it can occasionally sharpen or challenge my view.
In Tiger’s case, Jim Rogers invested in Tiger Brokers back in March 2017. Specifically, he participated in their Series B+ funding round, which raised about 100 million RMB (around US$14–14.5 million). This marked the first time Rogers had backed a Chinese technology startup. But there aren’t any legendary “guru” investors with a visible, concentrated stake. That’s not surprising. The company is still relatively small, trades in a space that many U.S. value investors have shied away from due to the China label, and doesn’t show up in most screeners unless you’re looking for international fintechs under $2-3 billion.
That said, Interactive Brokers owns just over 7% of the company. And that’s worth thinking about. IBKR isn’t an activist in the traditional sense – but it is a strategic player. They’re not just investors. They’re Tiger’s clearing partner and infrastructure backbone for U.S. equity trades. That relationship gives IBKR soft influence over the business model and potentially helps Tiger access better execution terms or institutional tooling. It’s not a governance lever – but it’s a functional edge that matters.
Another noteworthy development on the shareholder front came from outside the company’s management team. Li Lin, best known as the founder of HTX (formerly Huobi), recently disclosed that he has significantly boosted his stake in Tiger Brokers, increasing his position by nearly 290%.
In a 2023 list of the richest 1,000 people in China, Li Lin’s net worth is reported to be $960 million. His Tiger investment is worth roughly $130 million at today’s market cap.
This move makes TIGR his largest holding in any public company, a striking vote of confidence given his prominence in the broader digital assets and fintech ecosystem. Coming from an entrepreneur with deep roots in online trading and crypto markets, his decision to double down on Tiger suggests that he sees long-term value in the platform’s growth trajectory and its potential to capture a larger share of global brokerage activity.
Another strategic shareholder in Tiger Brokers is Xiaomi, the Chinese technology giant best known for its smartphones and consumer electronics ecosystem. According to the company’s annual report, Xiaomi holds roughly 4.6% of the total share base. While its economic stake is relatively modest compared to that of founder Tianhua Wu, Xiaomi’s involvement is notable because it brings brand strength, consumer reach, and potential synergies in mobile-first financial services. The partnership fits Xiaomi’s broader strategy of expanding its ecosystem beyond hardware into services that can deepen customer engagement and unlock new revenue streams. For Tiger, having Xiaomi as a shareholder not only adds credibility but also opens the door to leveraging one of China’s most influential consumer platforms.
There’s no activist investor on the board or visibly pushing for change. And honestly, I think that’s a good thing. Tiger doesn’t feel like a business in need of a strategy reset or capital allocation shakeup. It’s still in build mode – and the founder has executed well enough to keep control without interference.
Part 7: Valuation
Keeping It Simple
I like to keep valuation simple. There’s a Buffett quote that sums it up perfectly:
"If you need to use a computer or calculator to make the calculation, you shouldn't buy it...It should scream at you...we do not sit down with spreadsheets and do all that sort of thing. We just see something that obviously is better than anything else around that we understand — and then we act."
Charlie Munger said the same thing in fewer words:
"We never sit down, run the numbers out and discount them back to net present value. The decision should be obvious."
For me, Tiger does feel like one of those “obvious” cases. The company today has a little over 1 million funded accounts. The brokerage TAM in its region is massive. If I simply assume Tiger gets to 10 million accounts over the next 10–20 years, the math works out in its favor. The CAGR on users in that scenario is attractive whether you pick 10 or 20 years – about 25.9% annually if it gets there in 10 years, or about 12.2% if it takes 20. Either way, the outcome is very strong.
For context, TradeRepublic, founded in 2015, scaled to 8 million users already, so there’s no structural reason Tiger couldn’t get there too, in another region of the world.
And accounts are only half the story. The other half is account size. I expect the average funded account to be significantly higher ten years from now. Assets grow naturally as users stay on the platform and compound. And Tiger has been deliberate about user quality – prioritizing customers with higher balances rather than chasing vanity metrics. Combine secular tailwinds (including a potentially structural shift among <40-year-olds in Asia away from property toward equity investing) with a deliberate strategy, and you get a business positioned to ride both quantity and quality growth. That’s essentially my thesis. We could stop here.
If those two variables compound – more users, larger average account size – then the entry multiple I pay today isn’t all that relevant. Whether I’m buying Tiger at 13x, 20x, or even 30x earnings (if we’re buying at “peak earnings” and steady-state profits are slower than LTM or annualized numbers would suggest) won’t change the long-term outcome if the runway plays out.
As I said, the only caveat is avoiding buying peak short-term earnings, but with the multiple still in the low-teens, I’m comfortable even if in the short- to medium term earnings revert slightly, we’re not buying at a pricey multiple.
So What Multiple Are We Buying At?
When I annualize the most recent results, the valuation picture looks strikingly attractive.
Using Q2 net income of $41.4 million, I get to an annualized figure of about $166 million.
On H1 numbers, net income annualizes to $144 million.
Against a market cap of roughly $2.25 billion (and with EV ~ market cap given Tiger’s balance sheet; as discussed above), that puts the stock at 13.6x earnings (Q2 annualized) or 15.7x (H1 annualized).
On an EBT basis, the multiples compress further, to 11.5x (Q2 annualized) and 12.8x (H1 annualized).
Margins highlight both the strength and the leverage of Tiger’s model. Net income margin came in at about 34% in Q2 and 31% in H1. On a pre-tax basis, margins were even higher, at 40% in Q2 and nearly 39% in H1. They’re impressive – and they demonstrate how operating leverage is kicking in as revenues scale.
Again, of course, the risk in this type of back-of-the-envelope math is that I could be annualizing peak results. Trading volumes are elevated, interest spreads are wide, and retail activity is running hot. That could overstate the true normalized earnings power. But there’s an equal and opposite risk in being too conservative – using only trailing LTM numbers, which would severely understate the value of the business given how fast Tiger is growing.
For me, it comes back to balance: recognizing the potential for cyclicality, but not ignoring the obvious earnings power visible in the recent run-rate.
Strong Q3 Start
One reason I’m not overly worried about annualizing peak results is that Q3 has already started off strong. Management was explicit about this on the Q2 call: trading activity in July and August was higher than the Q2 monthly average, which means commission revenues are holding up. Client assets were also up by a high single-digit percentage compared to the end of Q2 (that’s QoQ), with the growth coming from both net inflows and market gains. It shows momentum carried over into the new quarter.
The Hong Kong expansion is also beginning to show real traction. Management said that the average net asset inflow per new funded account in Hong Kong was around $30,000, and that the overall contribution from Hong Kong client assets nearly matched Singapore in Q3-to-date. That’s a striking result given Singapore has been Tiger’s most important growth engine to date. Yes, the customer acquisition cost in Hong Kong is higher – about $400 per new funded account – but the payback period is only two quarters under current conditions, which is well within a healthy range.
Taken together, this paints a picture of a company that isn’t slowing down. Activity levels are strong, asset inflows are positive, and new accounts are high quality. If Q3 results follow through on this early commentary, it strengthens the case that Tiger’s recent earnings power is not just a flash in the pan.
Relative Valuation – Cheap Against Faster-Growing Peers
Looking at Tiger in isolation, the low-teens multiple already looks appealing. But the case becomes stronger when I compare it against listed peers. On a price-to-sales basis, Tiger trades at around 5.2x, versus 15.8x for Webull (BULL) and an eye-watering 25.9x for Robinhood (HOOD).
Even Interactive Brokers, a far more mature player, sits around 4.9x, and Futu, Tiger’s closest regional comp, is at 12.5x.
On a P/E basis, the gap is even more glaring. Tiger sits at 15.4x forward earnings (Koyfin figures), while Robinhood commands over 50x, Webull nearly 16x, and IBKR about 30x.
What makes this disconnect interesting is that Tiger’s growth profile actually outpaces many of these names. Over the past twelve months, revenue grew nearly 69% YoY, ahead of Robinhood at 59% and miles beyond Webull’s 11%. And unlike Robinhood, which is already running at relatively mature operating margins, Tiger’s margin structure is still converging toward peer averages.
Here’s another chart displaying EBIT margins:
That’s important: it means Tiger has more room for profitability expansion as it scales, while Robinhood or IBKR are largely already there.
In other words, Tiger combines faster top-line growth, improving margins, and a lower valuation multiple. That’s not a combination you see often in public markets, and it’s exactly what makes this setup compelling.
A Longer-Term View – What Could This Be Worth?
To stretch the time horizon, I modeled what Tiger might look like ten years out. Using the current 177.7 million ADSs outstanding as the share base and annualizing H1 net income ($143 million), then applying a 15% annual growth rate for five years, 10% for the next two, and 7% for the final three, I get to about $428 million in net income ten years from now (that’s an 11.6% CAGR on earnings). Put a 20x earnings multiple on that, and the implied market cap is $8.6 billion – up from about $2.25 billion today. That works out to roughly a 14% CAGR for shareholders.
Now, I’ll admit these are back-of-the-envelope assumptions, not a detailed model. But they don’t feel aggressive. In fact, they may even be conservative. The real kicker is margins. Right now, Tiger is still in land-grab mode, investing in licenses, customer acquisition, and platform depth. Operating leverage is only beginning to show. If you look at peers like Futu or Interactive Brokers, net margins stabilize in the 40% range once scale is reached. Consensus estimates on Tiger bake in revenue growth but assume margins stay roughly where they are, in the low 30s. I think that misses the story. With scale, I see margins converging upward, not staying flat.
If that happens, the earnings power could accelerate well beyond my $428 million base case in 2035. Even a modest beat on either the user growth side (more accounts, higher inflows) or the margin side (closer to Futu’s profitability profile) would put Tiger’s earnings trajectory on a steeper curve than what the market is currently pricing. The analyst consensus numbers today strike me as almost willfully blind to this operating leverage – they’re extrapolating the past instead of anticipating the natural economics of a scaled brokerage.
Let’s do a further breakdown of where net income growth could come from: Is my 11.6% net income CAGR reasonable?
If accounts grow from 1.15 million today to 5 million in ten years, that works out to an account CAGR of about 15.8%. That’s the engine. On its own, though, account growth doesn’t necessarily directly translate into profit growth – because older accounts tend to be higher-value than newer ones.
Layer two is margins. If I simply hold margins flat at Q2’s ~34% net income margin, that’s maybe too conservative (?). Peers like Futu or IBKR run much higher, and with scale Tiger could eventually get there too. But keeping margins steady removes the risk of overstating the case.
Layer three is asset appreciation. This is something people sometimes miss about brokerage models. Even if Tiger signed up no new customers, the assets of its existing funded accounts should grow over time. Markets rise. Customers save and add money. Wealth builds. Brokerages collect more interest income and fees on a bigger base. Assuming just 3% annual asset appreciation feels conservative to me, given long-term equity returns are much higher than that.
On paper, 16% account growth plus 3% asset appreciation implies something closer to high-teens net income growth. But once you haircut for the fact that newer accounts are smaller, that trading volumes won’t always rise in lockstep, and that some dilution is inevitable, I think 11–12% CAGR is a fair – albeit conservative – estimate that lines up well with my base case of 11.6%.
Additionally, if you look back at the table we built, diluted shares grew from 116.8m in FY2019 to 182.3m today – more than 55% higher in six years, which works out to a ~7.6% CAGR. Even if that moderates going forward, it’s fair to expect dilution will continue to chip away at per-share growth.
So the reconciliation might look something like this:
Account growth: 15.8% CAGR
Asset appreciation: 3% CAGR
Margins: flat at ~34%
Gross net income growth implied: ~19% CAGR
if we now subtract the impact dilution. If I assume 5–6% annual share count growth continues (a moderation from the 7.6% historical pace, but still realistic given the evergreen stock comp plan and past offerings), that alone cuts per-share net income growth down into the 11–13% range. Which is right in line with the 11.6% base case CAGR we’ve been using.
That makes the conservative scenario feel internally consistent: yes, the business itself might grow earnings at a high-teens pace, but for shareholders the real CAGR would land closer to low double digits in this scenario once dilution is factored in.
Now, after writing these couple of paragraphs, I was doing some more research on reasonable estimates of asset appreciation growth rates. In the brokerage industry, it’s common practice to assume a modest but steady rate of client asset appreciation when building financial models. Most firms anchor this in the 5–7% CAGR range over the long run, a figure that reflects the historical return profile of equities (roughly 6–8% real, or 8–10% nominal in the U.S.) but is adjusted downward to account for the fact that client portfolios are usually a mix of stocks, bonds, and cash rather than fully equity-weighted. You might also want to come up with a lower estimate if you believe long-term expected returns are going to be materially lower over the next ten years based on current market valuations.
As a result, 5% has become a kind of modeling convention for average annual appreciation. Several major players have even been explicit about these assumptions: Charles Schwab has used 5–6% in base-case scenarios during analyst days, TD Ameritrade likewise worked with mid-single-digit figures before its merger with Schwab, and LPL Financial has at times referenced 5% “market tailwinds” in its investor presentations. Interactive Brokers is more circumspect, generally framing customer equity growth as being in line with overall market performance, but without attaching a fixed rate. Together, these disclosures suggest that a 5% baseline remains the industry’s north star when projecting asset appreciation.
Now, flip the assumptions a little more bullish. If Tiger sustains 14% account growth (a moderation from the 19% CAGR between 2021–2025), assets rise closer to 5% annually, and margins scale from 34% to 55% by 2027 (in line with what mature peers achieve) – a factor that wasn’t contributing to stock performance in the conservative scenario –, the implied net income CAGR jumps closer to about 25–26%. That’s a very different outcome – one where earnings triple in a decade rather than just double.
Just to add more color on the math here: if we annualize H1’s revenue ($456M annualized), model 11.6% topline growth, but assume 55% net income margins in year 10, we get to earnings of $747,74 million in 2035 (an 18% CAGR from our $143M starting base). But once again, on top of this, you’d need to also account for the negative impact of future share dilution.
Disclaimer: I scooped up UP Fintech shares early this week at $12/share. The analysis presented in this blog may be flawed and/or critical information may have been overlooked. The content provided should be considered an educational resource and should not be construed as individualized investment advice, nor as a recommendation to buy or sell specific securities. I may own some of the securities discussed. The stocks, funds, and assets discussed are examples only and may not be appropriate for your individual circumstances. It is the responsibility of the reader to do their own due diligence before investing in any index fund, ETF, asset, or stock mentioned or before making any sell decisions. Also double-check if the comments made are accurate. You should always consult with a financial advisor before purchasing a specific stock and making decisions regarding your portfolio.
Closing Thoughts
Tiger isn’t a perfect business. The moat is still forming, the revenue base is activity-heavy, and there’s dilution, governance quirks, and the ever-present regulatory overhang that comes with being tied to China in any way. But investing is about weighing probabilities, not waiting for perfection. And when I weigh the risks against the upside, the balance tilts favorably.
The way I see it, Tiger is an underappreciated compounder in the making. It’s a capital-light, cash-generative platform with a long runway in front of it – more users, higher account sizes, expanding product depth, and a path toward margins that look more like Futu or IBKR over time.
The market still treats it as if it were the same China-exposed brokerage of 2021, when in reality it’s already shown it can adapt, grow, and thrive in international markets. That mismatch between perception and fundamentals is where opportunity lives.
At a low-teens earnings multiple, with strong growth and operating leverage kicking in, I don’t need Tiger to be perfect. I just need it to keep doing what it’s already doing. If it does, the long-term math will take care of itself. And in a market that often overpays for stories with far shakier economics, that’s a bet I’m comfortable making.