Managing Wealth: Advisor Perspectives on Investment Products and Fee Business
Report Summary
Managing Wealth: Advisor Perspectives on Investment Products and Fee Business
Advisors seek greater control over their clients’ assets and favor the Rep-as-Portfolio-Manager approach over other fee-based asset-management styles.
Boston, November 3, 2011 – A new report from Aite Group analyzes the use of investment products and fee-based asset-management styles across a broad sample of financial advisors. Based on an extensive Q1 2011 Aite Group survey of more than 430 U.S. financial advisors, the report also presents advisors’ growth expectations for products and asset-management styles.
Managing wealth has not been easy in recent years. Market volatility has made reading the financial markets difficult, and regulatory changes have reshaped the way in which investment products are distributed and client assets are managed. To navigate these challenging markets, advisors are allocating more of their clients’ assets toward annuities. They also favor managing fee assets directly, through Rep-as-Advisor and Rep-as-Portfolio-Manager approaches. While the Rep-as-Advisor approach attracts the largest percentage of fee assets today, advisors expect Rep-as-Portfolio-Manager assets to grow more rapidly in the next three years. Advisors who manage their clients’ assets directly are in a better position to take immediate action when markets show volatility; additionally, they can better compete with RIA firms, whose advisors often directly manage client portfolios.
“Brokerage firms should invest in their portfolio management infrastructure in order to handle a substantial increase in advisor-managed fee assets,” says Alois Pirker, research director with Aite Group and co-author of this report. “Firms must focus on providing an environment that enables advisors to manage client assets efficiently and in accordance with client requirements while maintaining a necessary level of control over the investment management process.”
This 38-page Impact Report contains 26 figures and two tables. Clients of Aite Group’s Wealth Management service can download the report.