[pullquote]there are more resources than ever to help independent financial advisors transition to the hybrid model[/pullquote]
After looking at their options, more and more independent financial advisors are opting into the “hybrid” business model whereby they can conduct both commission-based brokerage business and fee-based advisory business.
“Net head count at RIA firms with dually registered hybrid advisors grew by 14.7% annually from 2004 through 2009,” according to Cerulli Associates in a report last year. “That’s three times the growth rate of RIA-only firms over the same period.”
According to practice management expert Nick Georgis’ “Taking the Hybrid Road” report for OnWallStreet, one of the reasons is that there are more resources than ever to help independent financial advisors transition to the hybrid model and the hybrid advisors like having the ability to retain existing brokerage clients and preserve the income generated by the commission type business.
That being said, Georgis’ report further explores the two types of hybrid business models an advisor can choose from: the Semi-captive vs. Dually registered, depending on the level of autonomy and choice you want to have in your practice.
If you are an independent financial advisor considering the hybrid business, this is an excellent and thought provoking article and a “must read” before you make the leap because there is a lot to consider.