BofA, Morgan Stanley, Wells Fargo Battle to Regain Business Lost to RIAs: FRC Study
Wirehouses are working to regain lost market share by making major changes in the way they work with advisors, asset managers and investors, according to a research study just released Tuesday by Boston-based financial services consulting firm Financial ResearchGroup (FRC).
FRC discovered a broad array of action plans unfolding at the wirehouses:
- Wirehouses appear to be revising the roles advisors are playing, transitioning in many cases from the traditional definition of advisor
- Decision makers at the wirehouses are beginning to increase the emphasis placed on such factors as risk control and more sophisticated portfolio management in their relationships with retail customers
- New approaches to client development are being utilized to build the customer base
- Disconnect on Fees – Wirehouses and asset managers hold divergent perspectives on the importance of and pressure around fees charged for Managed Accounts.
- “Go Anywhere” Funds – These tactical, very popular, unrestrained funds are explored in depth to determine if they should be viewed as disruptive new solutions or a dysfunctional new bubble.
What does it all mean?
Expect more advertising, especially at the golf tournaments & in MSM magazines. You’re about to be inundated with peppy songs & sappy voiceovers on TV. Expect more advisors to be rolled into teams or pushed out. Imagine a new title given to someone in the office as Relationship Manager– which will be a para-advisor who answers the phone and can answer product questions, while your real Advisor is playing golf. Expect to see more products you probably don’t need.
Advisors, expect to have your pay cut even more as the overcharging strategy continues to crumble.
For the rest of the insights & the press release of the report, jump on over to AdvisorOne.