FinancialAdvisor-mag,com ran an interesting article by Gregory Bresiger this week based on a Friday morning roundtable sponsored by Fidelity Institutional Wealth Services, which sells RIA, custody and clearing services to reps and firms that are independent or considering the option.
The event, attended by independent financial advisors and advisory firm officials, reviewed the various aspects of advisors making the transition from national full-service firms to the different forms of independent advisory work.
Included in the discussion: Why are veteran wirehouse reps looking for the exit doors?
One of the reasons it is easier to walk away from a wirehouse now is technology. Alois Pirker, research director at industry consultant Aite Group, said the technology support levels between national firms and independents have become “similar.”
Another prominent factor appears to be the ongoing legal and regulatory debate over the responsibilities of the advisor. Some fiduciary-minded advisors at wirehouses are leaving over conflicts of interest.
The increase in mergers and acquisitions at the big firms has also added to the exit of some advisors.
Several panel members cautioned that the independent path is not suited to someone who has little business and few relationships. (Recruiters agree.) Restructuring a business as an independent one can take six months to a year.
Still, the roundtable participants agreed that financial advisors leaving wirehouses to go independent is now an unstoppable trend.