Anyone with a smartphone and access to Google can invest their money, and they do…poorly. The hard lesson learned by new independent investors is that investing in the expertise of an RIA (Registered Investment Advisor) is a worthwhile investment.
Hybrid firms are on the rise in 2024, and we need to talk about it!
Brokerage firms are becoming a model of the past, with RIAs and hybrid firms leading the way. It’s hard to beat total autonomy in pricing, branding, and work hours, not to mention clients having a plethora of services to choose from.
The Internet creates financial opportunities for everyone, leading to an increased demand for RIAs. Investor satisfaction with advisors continues to thrive, even in today’s unprecedented market. RIAs have the advantage of building trust early on and providing personalized services to their clients. With the increase in independent investors, it’s necessary to meet each client’s unique needs.
Cerulli Associates and the Securities Industry and Financial Markets Association (SIFMA) found that the number of ‘advised’ investors has increased from 35% to 47% since 2009. Meanwhile, those who consider themselves ‘self-directed’ have dropped from 41% to 24%.
Economic downturns and rising interest rates boost demand for wealth advisors. The number of investors willing to pay for advice has grown by 16% since 2009, reaching 63% (SIFMA). A hybrid RIA model is popular among wealth advisors who want to provide a highly personalized service to their clients. The annual RIA survey (SIFMA) revealed that advisor-managed assets at hybrid firms grew by 13.6%, and independent firms by 12.9% by 2022.
Hybrid firms and RIAs have seen favorable growth since 2009 with no end in sight. Independent investors understand the value of long-term wealth advice and planning.
How is your firm capitalizing on independent investors? Let us know in the comments!