From the November 2006 issue of Investment Advisor • Subscribe!

Good Time to Be an RIA

A chat with Schwab's Deb McWhinney

If Deborah McWhinney should ever want to change jobs, she could easily become the RIA community's designated cheerleader. When asked in an October interview what she had learned while sifting through the nominations for the first Impact Awards, McWhinney responded "there are so many great firms out there--and not all of them are billion-dollar firms," leading her to wonder "How on earth will we make a decision?"

With a final judging panel including Kurt Cerulli of Cerulli Associates, former Schwab executive Dan Leemon, and David Tittsworth of the Investment Advisers' Association, the final decisions were made, and will be announced November 7 at Schwab's Impact show in Washington. Awards will be given to two firms--a best-in business award and a best-in-technology award--and to one trailblazing individual for the Charles R. Schwab Impact Award.

McWhinney said that Schwab Institutional has "5,200 small businesses" who have a "familial way of doing business," who nevertheless are "serious about professional management." Through following best practices and taking that serious approach to business, which she said often starts when a firm hits the $25 million in AUM point, prompting a need for a growth plan, RIAs will continue to grow.

Commenting on the disputes over the so-called Merrill Lynch rule since its adoption by the SEC, McWhinney noted that "ironically, the Merrill rule has not helped Merrill," and that despite the commotion, RIAs are continuing to take market share away from the wirehouses. That's because, she says, the brokers can't provide what RIAs can and do: expertise and customization provided through a local presence.--James J. Green

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