Displaying items by tag: breakaways

(New York)

2020 was a rollercoaster of a year and not just in financial markets. It was quite a wild year in recruiting as well. When the pandemic hit, advisor movement dropped off to a trickle, but in the summer it started to come back and was roaring in the second half of the year. 2021 seems like it will be much the same. Both large IBDs and RIAs are looking to increase recruiting efforts, and offer packages for jumping ship have been getting larger. Commonwealth, for instance is planning a major recruiting push this year, which builds on other big efforts from Fidelity and LPL.


FINSUM: This definitely feels like an advisor’s market for moves. Firms are hungry to recruit and advisors seem to have the upper hand in negotiations.

Published in Wealth Management

(New York)

When the pandemic first hit, recruiting slowed down, with less advisors moving firms. However, after a couple of months, things started to pick up. According to a TD Ameritrade survey, 40% of advisors now say they are more likely to move than they were before the pandemic. Only 15% say they are less likely. If one comment sums up the increased velocity of recruiting, it might be this, “Advisors are at home and working in an independent environment. That can cause them to question what they are paying for at their firm. ‘Do I need the overhead and management of the wirehouse? Am I doing alright without it now?”.


FINSUM: On top of the questioning of whether all the overheads associated with a wirehouse make sense when they are working from home, the other big thing driving moves is the simple fact that it is easier for recruiters to reach advisors when they aren’t in the office. This makes the whole courting and exploration period much simpler.

Published in Wealth Management
Friday, 07 August 2020 16:38

LPL Launches New Program for Employee Advisors

(New York)

LPL has been a true leader on the recruiting front in 2020. One should expect no less from the largest independent broker-dealer. As one of their new initiatives, they have just launched a program—called the “independent employee” model—to try to attract new advisors who want some of the benefits of being independent, but also want to be a W-2 employee. Such models have been around for a long time, and are most prevalent at Raymond James and Ameriprise, but LPL thinks there is an opportunity to scale it up. The program is designed to appeal to wirehouse advisors who like being W-2s but want to earn higher payouts. Payouts for the program range from 50-70%.


FINSUM: If an IBD is a halfway house between being a wirehouse advisor and being an independent RIA, then this is a one-quarter-way house. It does seem like this might be a smart move—W-2 benefits with higher payouts.

Published in Wealth Management
Wednesday, 05 August 2020 17:20

Why Work-from-home is Helping Advisors Move Firms

(New York)

Something very interesting is happening in recruiting. While advisor movement slowed down right at the beginning of the pandemic, it has bounced back strongly in the last couple month. The reason why is that advisors are finding it easier to explore opportunities with new firms while they are working from home. Any advisor recruiter will tell you that calling a wirehouse broker at their branch is an almost impossible task as the office itself works as a gatekeeper. Even if you can get the advisor on the phone, it is taboo for them to speak about moving firms while they are in the office. Thus, the ability to take zoom calls from their comfort of their kitchen has opened the door to more recruiting since advisors are free to explore firms in-depth and with total privacy. Further, the lack of a need for offices has made advisors wonder if they need the infrastructure (and lower payouts) that come with being at a wirehouse.


FINSUM: The landscape for recruiting has changed overnight. No conferences, but no office gatekeepers either! It seems a great time for advisors to consider a move, and firms would be smart to put effort into recruiting right now as this is truly an unprecedented opportunity.

Published in Wealth Management

(New York)

New data is out showing which independents are gobbling up the most new recruits in the wealth management space. The overall picture emerging is that while April was a very slow month for changes, Raymond James and LPL are striding ahead of the competition through acquisitions and advisor recruiting. LPL has gotten 59 new recruits to join this year, while Raymond James has managed 20, worth $4 bn and $2.8 bn in AUM respectively. Some usual suspects have been absent so far this year. For instance, Advisor Group has lost more than 25 advisors to LPL in 2020 without announcing a single new advisor joining the network.


FINSUM: LPL and Raymond James have done a great job keeping their recruiting wallets open during this tough time. We expect the relationships they are building right now will keep their pipeline strong for the rest of the year.

Published in Wealth Management
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