Successful advisors adding wealthier clients, switching to fee-based models: report
By Lauren McNitt
ProWEB Wire (Industry News)
Successful advisors are moving to fee-based models and attracting more mid-to-high net worth clients, according to a new PriceMetrix report analyzing the differences between outperforming and underperforming advisors.
Outperforming advisors — those in the top quartile — grew their revenues 34 percent over the 12-month period ending in June 2011, while the bottom quartile of advisors grew their revenue just 4 percent. The report identified several reasons outperforming advisors are more successful than their underperforming peers.
Outperformers opened more and larger accounts than their peers, according to the report. The average size of accounts opened by outperformers was 37 percent greater than accounts opened by underperformers.
In addition, outperformers brought in more mid-to-high net worth households (more than $250,000 in assets), while decreasing the number of households with less than $100,000 in assets.
Outperformers are also moving toward fee-based business models, giving them a greater percentage of recurring revenue.