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Retirement Planning > Social Security

Kovack Securities Inks Outsourcing Deal to Add 35 Reps

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Independent broker-dealer Kovack Securities says 35 advisors are set to affiliate with it in South Florida, which could push its client asset level to more than $10 billion. As part of the arrangement, announced Wednesday, Capital Guardian is becoming an independent branch, or super office of supervisory jurisdiction, of Kovack Securities for its brokerage activities. 

“In this era of surging industry consolidation, our strategic alliance with Capital Guardian underscores the value proposition Kovack Securities offers to firms that seek to operate scalably, while enjoying the benefits of ownership stability and the boutique service culture that only a well-resourced, family-owned firm with a national footprint can deliver,” said Kovack Securities President Brian Kovack, in a statement.

Capital Guardian’s advisors will continue to provide their clients with fee-based advisory services and financial planning through Capital Guardian Wealth Management, the firm’s RIA. The RIA will have access to certain wealth-management solutions and platforms through its new relationship with Kovack Securities.

Kovack Securities is “excited about Capital Guardian’s strategic advantages, including its base of international clients, which is rare within the independent financial advice industry, and provides our firm with unique opportunities to expand our presence overseas,” the executive added.

Capital Guardian is based in Miami, while privately held Kovack Securities is headquartered in nearby Fort Lauderdale. The broker-dealer works with about 400 independent advisors nationwide and had nearly $10 billion in client assets as of June 2016.

“Our strategic alliance with Kovack Securities enables our team to focus on our core strength: Delivering fee-based boutique financial advice and comprehensive planning for our domestic and international clients leveraging the additional resources of Kovack,” explained Justin Lowe, chairman of Capital Guardian Holding, in a statement.

“Outsourcing our broker-dealer functions to Kovack Securities and their best-in-class technology platform will enable us to focus our efforts on accelerating the growth of our wealth management business and independent RIA firm,” Lowe noted.

According to Greg Hogan, executive managing director of Capital Guardian Holding, the emerging “focus on our strategic vision for the future has already generated a substantial increase in the number of high-quality recruiting opportunities in the Capital Guardian pipeline, with advisors across the full spectrum of advisory business models – from wirehouses to independents and financial institution affiliated advisors – expressing a surge of interest in joining our platform.”

In May, Kovack Securities completed an asset purchase agreement with TKG Financial, an IBD in Santa Barbara, California. As part of the arrangement, TKG became a super-OSJ of Kovack Securities, keeping its own brand and leadership team. TKG’s seven advisors, who have some $200 million in client assets, transitioned to Kovack Securities and its RIA, Kovack Advisors, as part of the deal.


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