There’s growing indication that even dyed-in-the-wool embedded commission guys are actively bringing fee-based accounts into their books, according to new data that charts the growth of that compensation in the run up to CRM2 implementation.
There’s growing indication that even dyed-in-the-wool embedded commission guys are actively bringing fee-based accounts into their books, according to new data that charts the growth of that compensation in the run up to CRM2 implementation.
The industry also saw a transition to fee-based revenue in 2014, a PriceMetrix report suggests, with the percentage of fee-based assets in an average advisor’s book increasing from 31 per cent to 35 per cent in 2014, while the percentage of fee revenue rose from 47 per cent to 53 per cent.
“Both of these trends are directly improving advisor productivity and client experience which is at least partially reflected in last year’s impressive results,” said Doug Trott, president and CEO of PriceMetrix.
His comments seek to put the findings of the State of Retail Wealth Management report in context. The work highlights a year in review for advisors in 2014, drawing on its database of more than 40,000 advisors, seven million investors and $3.5-trillion in investment assets.
Fee-based pricing also improved in 2014, rising from 0.99 per cent in 2013 to 1.02 per cent last year, the first increase in several years.
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The report found that assets-under-management for the average advisor reached $97 million in 2014, average advisor revenue surged 13 per cent to $655,000 and revenue on assets, or RoA, improved to 0.69 per cent, the first increase since the beginning of the financial crisis in 2008.
Advisors also continued to reduce the average number of clients they serve as the number fell from 156 in 2013 to 150 in 2014. Overall, advisors have reduced the number of clients they serve by 10 per cent.
At the same time, average client assets increased to $628,000 from $562,000, according to the report.
Bottom-performing advisors also struggled in 2014, actually seeing revenues decline, leaving them and their firms with difficult decisions moving forward.
“Advisors and their firms simply cannot afford to overlook younger clients,” he said, adding that while some might see a soft short-term hit, the long-term benefits far outweigh the risks. “They need to devote a significant portion of their business development efforts to younger clients or their future growth will slow down.”
The industry also saw a transition to fee-based revenue in 2014, a PriceMetrix report suggests, with the percentage of fee-based assets in an average advisor’s book increasing from 31 per cent to 35 per cent in 2014, while the percentage of fee revenue rose from 47 per cent to 53 per cent.
“Both of these trends are directly improving advisor productivity and client experience which is at least partially reflected in last year’s impressive results,” said Doug Trott, president and CEO of PriceMetrix.
His comments seek to put the findings of the State of Retail Wealth Management report in context. The work highlights a year in review for advisors in 2014, drawing on its database of more than 40,000 advisors, seven million investors and $3.5-trillion in investment assets.
Fee-based pricing also improved in 2014, rising from 0.99 per cent in 2013 to 1.02 per cent last year, the first increase in several years.
#pb#
The report found that assets-under-management for the average advisor reached $97 million in 2014, average advisor revenue surged 13 per cent to $655,000 and revenue on assets, or RoA, improved to 0.69 per cent, the first increase since the beginning of the financial crisis in 2008.
Advisors also continued to reduce the average number of clients they serve as the number fell from 156 in 2013 to 150 in 2014. Overall, advisors have reduced the number of clients they serve by 10 per cent.
At the same time, average client assets increased to $628,000 from $562,000, according to the report.
Bottom-performing advisors also struggled in 2014, actually seeing revenues decline, leaving them and their firms with difficult decisions moving forward.
“Advisors and their firms simply cannot afford to overlook younger clients,” he said, adding that while some might see a soft short-term hit, the long-term benefits far outweigh the risks. “They need to devote a significant portion of their business development efforts to younger clients or their future growth will slow down.”
