At the Morningstar Investment conference in June, I sat down for lunch with a fellow attendee, who quickly revealed that he was an advisor from Florida and a frequent attendee of the Morningstar conference. We chatted about what he was interested in, notably the latest research on investing, the at-times arcane insights of Cliff Asness and Rob Arnott and how robo-advisors might change the advisory industry. He told me his firm built its own model portfolios, but he was always looking for ways to make those models better or cheaper. He told me about how he felt honored to serve his clients, many of whom had been clients for decades. I was assuming by this point that he was your typical RIA — after all, he was also dressed like a typical RIA, in khakis and a conservative polo shirt. My assumption held until, when discussing advisor expenses and fees, he said, “I don’t know how Merrill Lynch can raise its fees” to end clients at the same time that increased competition from robos and others was putting pressure on advisors to lower their fees to clients. Yes, he admitted cheerfully, he was a Merrill broker.
That cliché that we live in interesting times happens to be accurate right now for the advisor community. The pen can be mightier than the sword as well: The words we use to describe ourselves can be revealing or dissembling.
That’s why somewhere back in the mists of time — at least since 1999, when I joined this magazine — Investment Advisor has not only opted to spell advisor with an “or” rather than an “er,” but we’ve used the general phrase “advisor” to describe you, our readers, in print and on ThinkAdvisor.com.
When we launched our portal website for advisors in 2010, we decided that the architecture of ThinkAdvisor.com — how it’s built internally and how it’s presented to you on both the home page and every article page — would be business-model and compensation-model agnostic. That is, we would place all our content into one of four broad topic categories: The Portfolio, Wealth, Retirement and The Practice. Why? Because we judged that these were the four main topics in which all advisors are interested, regardless of whether they’re a registered investment advisor or independent contractor BD representative or an employee broker, like my friend from Merrill.