Knowledge and Insight
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Business model cracked but not broken
Added on February 2012 in Thought Leadership
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Summary: For many, 2011 will be remembered as the year the broker-dealer model cracked. Scores of independent firms shut down, unable to keep up with rising legal and compliance expenses. Dozens were simply buried under the cost of lawsuits from clients who bought suspect private investments when the market was roaring in the middle of the last decade.
Fidelity dissects the breakaway cycle with a new study
Added on February 2012 in Join an RIA
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Summary: “Fidelity Insights on Independence Study” is a survey Fidelity conducted on breakaway brokers in collaboration with Cogent Research. The findings confirm the antidotal evidence; 94% reported that that they are happy with their decision, more than 75% are better off financially and 86% said that all or most of their clients moved with them.
Fear of Flying: Jumping From Wirehouse to Independence
Added on February 2012 in Form an RIA
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Summary: Fear of Flying depicts two advisors, one from the East Coast and one from the West Coast, who leave their respective wirehouse firms and start their own RIAs. The advisors describe their choice points, fears, challenges and success.
Pershing Releases Advisor Business, Succession Planning Guidebook
Added on January 2012 in Plan for the Future
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Summary: Pershing Advisor Solutions (PAS), the RIA custody division of BNY Mellon, on Thursday released Developing a Sustainable Business and Succession Plan: An Independent Advisor’s Guide, a 30-page practical PDF guidebook that presents detailed steps advisors can take to build a business plan and a succession plan. The guidebook, developed with Advisor Growth Strategies LLC, the practice management consulting firm led by former Schwab executive John Furey, presents stark figures on the relatively small number of advisors who have developed formal business and succession plans, including research showing that fewer than a third of RIAs have either defined or implemented a succession plan.
RIA deals fizzle in the fourth quarter but big-paying banks are getting back into the game
Added on January 2012 in M&A Issues
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Summary: 4thQuarter 2011 M&A deals were down in volume. Schwab Advisor Services reports that there were only 57 M&A deals involving RIAs for the full year 2011 representing approximately $44 billion in total assets. There were 70 deals in 2010 representing $63 billion in AUM. It’s worth noting, however, that the 57 deals were still the second-most ever recorded by Schwab since it started counting them in 2004. The size of the average deal in 2011 was $798 million, the lowest average since 2005 and down from $895 million in 2010.
