Majority of Public Doesn’t Know RIA Model Exists: Advizent’s Goldman

Count on Charles Goldman to give it to you straight. He is, after all, on the forefront of the fiduciary battle, and the company he co-founded, Advizent, counts John Bogle and Robert Kaplan as board members.

His presentation at MarketCounsel’s Member Summit 2012 was titled “The RIA Industry: Trends, Facts and the Need for Branding,” and it did just that; hammering trends, facts and the overwhelming need for advisor branding.

The information he delivered made it abundantly clear why branding is so important.

“Fully 84% of investors do not know the RIA model even exists,” he said in response to his own question of why wirehouses maintain the asset levels they do, despite scandal, headline risk and a “broken business model.”

“Your clients think you are a broker, and don’t know the difference between a broker and an advisor. Most shocking, 66% of clients think their advisor is a fiduciary, and that’s being generous. I saw one Cerulli study that pegged the number at 85%. Yikes.”

The bulk of Goldman’s presentation was given to debunking “myths” promulgated by “our friends in the press.”

“Let me start out by saying everything’s crap,” Goldman said to laughter. “It’s a tough world. We have low interest rates, volatile markets, a struggling economy, poor political sentiment, regulation changes and a euro zone crisis.”

But Americans themselves, he added, are optimistic about their economic situations, as poll after poll demonstrates.

“The stock market certainly doesn’t reflect poorly on the current situation,” he added.