It’s not easy to change your broker/dealer. When readers cast their ballot for the magazine’s annual Broker/Dealers of the Year honors (voting in June; results in September), the answers they give on our survey reveal a lot about what advisors like–and don’t like–about their broker/dealers. Among the ballot’s questions is one asking where reps would go if they were to consider moving to another B/D. While there are a number of great B/Ds around, three firms are consistently mentioned in that balloting. In this, our launch of a regular monthly department which will focus on the independent broker/dealer universe, we thought it might be helpful to take a closer look at those three firms.
In alphabetical order, the three are Commonwealth Financial Network, LPL Financial Services, and Raymond James Financial Services. Each firm has its own strong and distinct culture but shares some traits that may explain why they are the ones advisors think of first. According to the 2005 IA Broker/Dealer Directory, all three are among the 10 biggest B/Ds by gross revenues. LPL and Raymond James are among the 10 biggest by number of representatives; and LPL and Commonwealth are among the 10 fastest growing as measured by number of representatives.
What sets Commonwealth apart are technology, a nurturing, sharing community, and the luxury of being privately-owned, says Joseph Deitch, chairman and CEO of Commonwealth Financial Network, in Waltham, Massachusetts and San Diego. His goal is to provide the means for advisors to “leverage their time and talent” in an environment that is enjoyable and nurturing. “We’re on the short list of firms that have all the cool stuff,” says Deitch, including a hosted technology platform, accessible from anywhere, anytime. If an advisor has a technical problem, “we can take over their computers and fix it for them.”
The average advisor at Commonwealth has “15 to 20 years of experience,” and average production is $250,000, according to Deitch. But Commonwealth turns down about 40% of the advisors that want to join, and they won’t bring aboard a big producer who is not a good fit for the community. “We demand that they act responsibly and we hope they act compassionately. Sometimes it’s not the right fit, and when that happens we try to recognize it and then we part ways.”
Janice Hart, VP, national field development at Commonwealth, adds, “We want extraordinarily nice people to do business with–a high-end advisor who is doing the right thing for their clients, and [is] a blast to be around.”