Stand in line, all you other broker-dealers—whether regional, national or wirehouse. Independent BDs have you beat for growth over the last five years, in both assets and headcounts.
So says U.S. Broker/Dealer Marketplace 2018: Escalating Margin Pressure, a new report from Cerulli Associates that also says that independents’ compound annual growth rate over the last five years “nearly doubled the four wirehouses, which posted a mere 6%.”
IBDs’ CAGR hit 11%, surpassing the 9% gains of gains of retail bank BDs, as well as those of national and regional BDs (also at 9%).
“IBDs have the second-largest advisor force at more than 59,000, a total that soars to an industry-dominating 86,779 when including hybrid registered investment advisors,” Ed Louis, a senior analyst at Cerulli, says in the report.
(Related: Why Hybrid RIAs Are Enjoying Stellar Growth)
Louis adds that in addition, “IBD channel assets totaling $2.8 trillion surge more than 20% when including hybrid advisors’ assets held by their respective B/Ds. However, the sheer size of the channel is not the explanation of growth.”