Schwab Advisor Services released Tuesday the results of a survey of independent broker-dealer and insurance company reps that found that a large majority of respondents liked the idea of starting or joining an RIA firm.
Specifically, when asked, “How appealing is the idea of becoming an independent registered investment advisor at some point in the future?” 86% of the 157 respondents answered by saying they found the idea “very” (28%) or “somewhat” (58%) appealing.
The online survey was conducted on Schwab’s behalf by an independent survey firm, Koski Research, between Jan. 5 and Jan. 21, 2011. Respondents came from a wide range of different sizes and business models of independent BDs and insurance companies, a Schwab spokesperson said.
In a pre-release interview on March 24 discussing the survey’s findings, Bernie Clark, head of Schwab Advisor Services, argued that brokers who “migrated to IBD models, long ago or in the last two years, now they’re saying it’s time to go independent.”
That goes for wirehouse advisors as well, Clark (left) said. “In 2008,” he said, when wirehouse advisors were thinking of leaving due to the troubles with the big firms, “it was natural to gravitate to an existing platform where they could bring their books of business.” Once they got to an independent BD, however, Clark believed “ they became students of the independent model.”
In the statement accompanying the survey’s findings, Nick Georgis, a VP with Schwab Advisor Services, the largest RIA custodian with some 6,000 affiliated advisors, said that Schwab “saw a 45% increase in the number of advisor teams transitioning to independence from IBD firms in 2010 compared to 2009.”
When asked in the survey which “environmental factors” would make those BD reps more likely to move to an RIA model, a “friendlier economic and tax environment for small business owners” was the top factor—at 45% of respondent—followed by “an improved overall market and economic environment,” at 43%.
Some wirehouse brokers may be prompted to leave by the changing ownership of the big