Wirehouses continue to struggle to retain their most productive advisors, according to new research from Cerulli Associates.
The study shows that wirehouses are continuing to lose assets to advisors in independent channels at a "slow but persistent pace."
Advisors at wirehouses also report a lower level of satisfaction with their employers than do independent RIAs.
Recommended For You
Wells Fargo's advisors reported the highest levels of satisfaction, while those at Morgan Stanley reported the lowest, according to the survey.
See also: RIAs grew 8 percent between '04 and '12
The most satisfied advisors in the wirehouse channel tend to be the most successful. Advisory teams with more than $500 million in assets under management control almost half of the channel's assets. They report the highest level of satisfaction with their firms.
But their loyalty will be challenged by the fact that 12 percent to 20 percent of all long-term retention contracts will expire each year between now and 2019.
Independent broker-dealers know as much, and will be ready to lure the biggest books of business away with the attractions of independence.
Cerulli's study attributes a generally low level of satisfaction with the wirehouses to advisors' perspectives of management, technology and support issues, and compensation.
When asked if they were to leave their current firm, 28 percent of wirehouse advisors say they would prefer the independent model.
Almost one-quarter of advisors surveyed have given consideration to going independent within the past year. The percentage is a bit higher for advisors with more than $100 million under management.
The allure of autonomy — and perhaps greater compensation — has proven to be a substantial drag on wirehouses' effort to retain their talent. In 2012, the net effect was a loss of $74 billion in assets throughout the channel, accounting for 1.4 percent of total assets, according to Cerulli.
© 2025 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
