Raymond James Has Near-Record Recruiting Year

Contributing to some of that noise has been the Labor Department’s fiduciary rule and other regulations, Elwyn said.

“I would describe it as a really interesting year, in which both advisors really wanting to ascertain what impact the DOL and other regulations might have on their practice — whether they choose to remain where they are or choose to affiliate with a new firm altogether — was certainly a factor that weighed on potential movement industrywide,” he explained.

In particular, he said the fiduciary rule FAQs that came out in October 2016 “reshaped the landscape” as firms contemplated the appropriateness of continuing to have certain recruiting incentives, like back-end bonuses.

On top of these concerns, Elwyn sees “more flux than there’s ever been in terms of strategy” at many of the firms.

Elwyn said some other firms are asking, “Are we recruiting? Yes or no? Who are we recruiting? Is it purely next gen advisors, is it up-and-comers? Are we still interested in successful veterans?”

According to Curtis, less uncertainty among independent firms likely contributed to why the past year was not the same as the prior year.

“When we look at firms historically that we’ve recruited from, we tend to recruit a much higher percentage of advisors from employee firms — whether its Wells Fargo, Morgan Stanley, Merrill Lynch, Edward Jones, Ameriprise, etc. — than the independent firms,” Curtis told ThinkAdvisor.

That was consistent again in fiscal 2017, he added. While in the prior year, fiscal 2016, there were more advisors from independent firms — as a percent of the total — than is typical.

“I give [CEO] Dan Arnold and his team at LPL credit because I think they’ve done a good job getting out and meeting with advisors that are affiliated with LPL and giving them greater confidence in the organization and the organization’s future,” Curtis said.

Curtis said there was more uncertainty in the prior year at Cetera, as well as LPL.

“In the past year, that uncertainty was not there in the way it was in the prior year,” he added. “So I think that was a contributor to fewer LPL advisors or advisors affiliated with LPL, affiliated with Cetera, considering making a move.”

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