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Avoid Guilt by Association

17:26 12 March in Articles Written by Jon Henschen by rafferty

March 12, 2018 By Jon Henschen, ThinkAdvisor ‘Clean advisors’ can and should avoid ‘dirty broker-dealers’; do your homework to avoid big headaches. As an advisor, you relentlessly perform risk assessments for your clients’ portfolios. Yet, one aspect of risk assessment you may ignore is the downside of being an advisor with a clean compliance record who is tied to a broker dealer with problematic compliance and financials. Compliance issues at the broker-dealer level are an area of concern rarely explored by advisors, but they should be. Is your broker-dealer home to a high number of advisors with numerous compliance or credit disclosures? As the Financial Industry Regulatory Authority drills down on anything and everything, a broker-dealer in poor standing with FINRA can make life more difficult for all its advisors — even if you may...

Cetera sale talk another distraction for advisers

17:00 27 February in In the News by rafferty

February 26, 2018 By Bruce Kelly, Investment News Company emerged from bankruptcy less than two years ago; plans to brief advisers Tuesday afternoon A potential sale of Cetera Financial Group could be boon for its private equity owners, but turn out to be another distraction for its 8,000 advisers, who saw the company emerge from bankruptcy less than two years ago. On Friday, Bloomberg News reported that Cetera was exploring a sale that could fetch its private equity owners as much as $1.5 billion. On Monday, the company said it launched an internal review with the objective of optimizing its capital structure, lowering costs and maximizing continued investments. Cetera also said it hired Goldman Sachs & Co. for the review. "It is a distraction," said one Cetera adviser, who asked not to be named. "If management wants...

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Private equity likely buyer in Cetera sale

16:15 27 February in In the News by rafferty

February 26, 2018 By Tobias Salinger, Financial Planning Cetera Financial Group’s more than 7,700 advisors across six independent broker-dealers may soon face yet another big change: new ownership. The IBD network is exploring a sale and the price tag could amount to $1.5 billion, or $350 million more than RCS Capital paid in 2014 to acquire the El Segundo, California-based firm, people familiar with the matter told Bloomberg. Creditors assumed control of Cetera after RCS went bankrupt in 2016. Executives with Cetera and its current parent, Aretec, retained Goldman Sachs to help with what they called “a capital structure review process,” the firm announced this week. Representatives for the firm said it would be premature to speculate on the outcome of the review. Private equity firms and other investors see opportunities in wealth management, Cetera...

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How to Conquer Your Top Fear When Changing Broker Dealers: Client Retention

19:27 21 February in Articles Written by Jon Henschen by rafferty

February 21, 2018 Jon Henschen as published on ThinkAdvisor You may have heard this before, “If you change your broker dealer, you’re going to lose 30% of your book.” It’s fairly common for advisors to make blanket statements such as this about client retention. And while it is possible to lose clients, the devil is in the details: where are you leaving from, where are you going to, and why. If you’re going from a bank to an independent broker dealer, a 30% or higher loss of your client base is quite common. This often is due to non-compete clauses and bank legal maneuvers to prevent your clients from moving with you. However, if you are moving from an independent broker dealer to another independent broker dealer, retention numbers are much higher, with losses of...