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Broker/dealers, custodians and asset managers need to adapt as adviser teaming gains speed


Broker/dealers, custodians, and asset managers need to adapt as adviser teaming grows, according to new research by Cerulli Associates.

"The appeal of adviser teaming has grown among both established and new advisers," comments Kenton Shirk, associate director at Cerulli. "For advisers, a successful merger can generate substantial growth and productivity enhancements."
With the growing complexity of planning needs, investment products, technology, and regulations, small adviser practices may struggle to tread water, opening the door to consolidation opportunities for larger practices with a robust infrastructure.
"The growth of multi-adviser practices is most pronounced in independent channels. The average number of total professional staff per practice is 3.3 in the wirehouse channel. That compares to an average of 5.2 for dually registered practices and 4.5 for registered investment advisers," Shirk explains.
"The advisery industry is increasingly shifting away from an individual producer mindset to that of a multi-adviser team," Shirk continues. "The industry's largest practices and mega teams also typically serve affluent investors, which reinforces their propensity for teaming. The desired result is providing broader and deeper services to meet the more sophisticated needs of their high-net-worth clientele."
"Mega teams cite the ability to provide more services as the primary reason for teaming. By pooling resources, they are better equipped to specialise adviser and staff roles," Shirk adds. "Teaming offers an opportunity to develop specialised roles for both advisers and staff, which greatly enhances adviser growth opportunities and productivity levels."

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