Hybrid's New Groove

Donna Mitchell | Financial Planning, May 2011

Summary: A small number of RIAs with national ambition are joining IBDs so they can attract breakaway brokers that need to be hybrid reps. Beacon Pointe Advisors of Newport Beach, California is using this strategy with success.

The hybrid sector growth was measured in Cerulli Associates’ study The Advisor Metrics 2010. From 2004 to 2009, the headcount at dually registered hybrid firms grew nearly 15%, almost three times that of RIA-only firms.

Historically we have been a fee-only RIA. As we recognized people would start jumping ship from wirehouses, we adopted a hybrid stance."

Matt Cooper, President, Beacon Pointe

Our Commentary

While there is strong evidence of the growth of the hybrid RIA, and their are a number of RIAs who desire a national footprint, I do not think you will see a large trend of fee-only RIAs joining independent broker dealers to attract hybrid reps. The RIA would more likely merge with an existing RIA for growth.

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