What RIAs are doing right
Despite dire warnings of client attrition and margin compression since robo advisers and digital technology came on the scene about a decade ago, the RIA business appears to be more successful than ever.
Revenue, assets under management, number of clients and profit margins are all increasing rapidly, according to the just-released 2017 RIA Benchmarking Study from Charles Schwab — and fees advisers are charging clients are holding steady.
What's more, wealth managers are attracting more high-net-worth investors and adding more assets from clients who are new to their firm, the study found. And the fastest-growing firms — those in the top 2O% of RIAs with $250 million or more in AUM — are using comprehensive marketing strategies to attract new client assets at 2.4 times the rate of all other firms.
"The numbers are all in a positive direction for RIAs," says Jon Beatty, senior vice president, sales and relationship management, Schwab Advisor Services. "Independent advisers are clearly making the right strategic decisions to retain their valued clients and to win the trust of new clients. They're also adding to their teams and what we're seeing right now is a virtuous cycle of talent and growth."
From growth in AUM to hiring, here are the most significant findings of the study: