But the spokesperson said it’s also about accumulating assets.

“A lot of advisors are very quick to say, ‘The asset means so much to me,’” so they give a discount, he said. “But there are assets that you want, but only if it’s fairly priced. That means you offer people the service and you price it accordingly, and you try to avoid the knee-jerk reaction of wanting to make sure that the client becomes a customer.”

Advisors are opening more fee-based accounts every year; on average, 11.5 in 2008, 13.5 in 2009, and 14.5 in 2009. And the assets in those fee-based accounts make up 25 percent of total assets under administration and 37 percent of total revenue. In fact, over the last four years, the average advisor’s assets in fee-based accounts have increased by 24 percent, while transactional assets have actually declined slightly (1 percent).

Although advisors are working more and more with fee-based accounts, they are earning less on these accounts thanks to the deep discounts individual advisors are offering their clients — most ranging from 72 percent to 79 percent of their firm’s scheduled pricing. Interestingly, the biggest discounts are going to the smallest accounts.

The best way to control pricing, according to the study, is to set a fair price from the start rather than offering deep discounts. Only five percent of advisors were able to raise their prices by more than ten basis points on existing accounts over a three-year period.

For advisors who already have several accounts with discounted fees, it is possible to grow business for the future — as long as the pricing model moving forward is more in line with industry standards, and not as deeply discounted.

“You do have an opportunity with your new business to get a fair return,” the spokesperson said. “As long as your new business, going forward, is properly priced.”