You probably don't think of Scottrade in the same way as a Schwab (SCHW) or Pershing, but it might only be a matter of time. The St. Louis-based custodial and trading firm announced Tuesday that its Scottrade Advisor Services arm recently surpassed 1,000 advisory firms in its client base.
The institutional division “has seen progressive growth year over year, with 2010 assets growing by 50% and 2011 assets growing by 45%,” Scottrade said in a statement.
“I think we've got a great value proposition,” Brian Davis, director of Scottrade Advisor Services (left) told AdvisorOne when asked about the reasons for the firm's success. “We have no asset minimums, which offers a low barrier to entry for breakaway advisors, as well as existing firms. We don't compete with our advisors for clients like many of our competitors. Most importantly, our customer service sets us apart. The advisor gets a dedicated team, regardless of asset size; we don't have a call center-type structure."
Davis said the source of the advisors with which Scottrade partners is "pretty evenly split" between wirehouses and independent broker-dealers.
"We see some that are coming from the wirehouses and stopping at an independent broker-dealer first before striking out completely on their own," he adds. "However, I should include the caveat that this really applies to the advisor who is very entrepreneurial."
Scottrade Advisor Services offers educational and support resources to help with RIAs with business and investing needs, including:
- Advisor Advocate: Advisors use this newsletter as a resource to check for up-to-date news and industry information to help them stay informed.
- Advisor Online Community: Advisors can connect with nearly 500 other RIAs through its online community to share ideas.
- Strategic Resource Partner Directory: Advisors have a directory of services to help locate resources necessary to grow their practice, including compliance and marketing resources.
As the company notes, the RIA space has transformed in the past few years as more advisors working at brokerage firms and wirehouses are leaving to go independent. Scottrade Advisor Services recently released its Going Independent Guide for advisors looking to make the move.