The dually registered advisor channel could control 8.5% of client assets in 2012, according to Cerulli Associates Inc.

Cerulli, Boston, published that figure in a look at advisor portfolio construction dynamics. Analysts at the firm cover trends in the retail advisor market, managed account programs and platforms, client risk tolerance, asset-allocation strategies, portfolio risk assessment and product selection.

The market share held by dually registered advisors–advisors with the credentials needed to operate both as registered investment advisors and as affiliates of broker-dealers – has been growing more slowly than Cerulli analysts were expecting in February 2010.

Back then, Cerulli analysts estimated that dually registered advisors had an 8.9% share and could increase their share to 10.5% in 2012.

The analysts now estimate dually registered advisors will end 2011 with an 8.2% share.

The wirehouse channel still has a 36% of market assets, but that could drop to about 33% in 2012, the analysts say.

The analysts estimate insurers will increase their share of the assets to 3.8%, from 3.7% today.

Like insurers, regional broker-dealers and registered investment advisors may end 2012 with shares of the market close to the current level, the analysts predict.

Independent broker-dealers could increase their share of the market to 16.6%, from 16%, and banks could increase their share to 9.1%, from 8.2%, the analysts say.

- Warren S. Hersch