trending Market Intelligence /marketintelligence/en/news-insights/trending/jQ0OI-QSE9l5LbAUsWYrdQ2 content esgSubNav
Log in to other products

Login to Market Intelligence Platform

 /


Looking for more?

Contact Us
In This List

Independent adviser space to see continued growth, says Schwab CEO

Banking Essentials Newsletter December Edition Part 2

Banking Essentials Newsletter - November Edition

University Essentials | COVID-19 Economic Outlook in Banking: Rates and Long-Term Expectations: Q&A with the Experts

Estimating Credit Losses Under COVID-19 and the Post-Crisis Recovery


Independent adviser space to see continued growth, says Schwab CEO

Growthin the independent adviser sector will keep outpacing other segments as investmentprofessionals leave traditional brokerages to set up their own shops, accordingto Charles Schwab Corp.'stop executive.

The industryhas seen a small, but persistent flow of brokers from the wirehouses to the registeredinvestment adviser space, with little movement trending in the other direction,President and CEO Walter Bettinger said.

"Wedon't see RIAs saying, 'I'm going to go back into the wirehouse model,'" Bettingersaid during a conference to provide a business and earnings update.

Schwabhas surveyed independent advisers to find out their motivation to break away, oftenin groups that establish their own RIA business. The company partners with RIAsthrough Schwab Advisor Services, and recently began a marketing touting their merits as managersof individual wealth.

Adviserscited as flexibility in designing portfolios, more control over expenses to lowercosts to end clients and the economics of owning their own businesses as incentivesfor leaving wirehouses.

"Allof those three, we think, will continue to drive a certain percentage of brokerstoward the independent model," he said.

The company'srobo-advice platform grew to $9 billion in assets under management. The automatedbusiness is not likely to replace humans because most clients prefer to deal witha person for investment advice, Bettinger said.

Clientswho participate in digital-only advice tend to prefer investment self-direction,a trait that is shared among those clients even more than age, the CEO said.