 Wirehouses seem to care less about market share and more about profits, says Bing Waldert, of Cerulli Associates in Boston, who points out that the reason many clients have fled to low-cost Internet options is because wirehouses have been purposefully cutting loose less profitable clients.” |
Our Commentary
The 40% drop in commission-only reps is a resounding confirmation of the evolution of the financial advisor and the inevitable decline in the stock broker.
The wirehouses seem to be shedding the mass affluent client who is turning to the internet for online solutions. The mass affluent is where opportunity is for firms with scale and scope like Schwab, The Mutual Fund Store and Ric Edleman. There are likely to be additional entrants in this segment.
We are interested in learning the confirmed causes for the big drop in marketshare of the IBDs. Is it firm closures, IBD breakaways to RIAs or people leaving the industry? 4% is a big number.
