Fidelity Poll Finds Broker-Dealer and RIA Firms Focused on Hiring in 2011

New Clients to Be No. 1 Driver of Growth This Year

BOSTON -- With the unemployment rate back up to 9 percent, three-quarters (75%) of U.S. broker-dealer and independent registered investment advisory (RIA) firms are planning to hire up to 30 percent more employees over the next 12 months, according to a new poll conducted at Fidelity Investments’^® 13th Annual Executive Forum client event held May 2-4. 

According to the poll, firm executives reveal that their No. 1 staffing priority in 2011 is to recruit new advisors/brokers that have existing books of business (43%), followed by 19 percent who plan to mentor and help existing staff transition to a broker or advisor role.  Interestingly, nearly one-third (32%) of broker-dealers and RIAs say that ongoing industry consolidation has made it easier to recruit, while 62 percent say it has had no impact.

“Growth is top-of-mind for many broker-dealers and RIAs -- something that we heard loud and clear from the hundreds of clients we just hosted at our conference,” said Scott W. Dell’Orfano, executive vice president, sales, Fidelity Institutional Wealth Services.  “A strong focus on recruitment, especially as a component of a broader client acquisition strategy, is extremely good news for the industry and speaks to an overall confidence for its continued growth and success.”

More than 335 broker-dealers and RIA firms attended the conference, most of whom are clients of Fidelity’s custody and clearing units, two of the nation’s largest with more than $1 trillion in assets under administration .

Recruiting Clients and Advisors Are Key Drivers of Growth
According to the Fidelity poll, broker-dealer and RIA firms say that adding new clients will be their No. 1 driver of profitability this year (60%), a 17 percentage point increase over 2010.  Firms expect adding new brokers and advisors will be their second biggest driver of profitability at 21 percent, up from 14 percent in 2010.  While broker-dealer and RIA firms see client acquisition and broker recruiting as their two biggest drivers of growth in 2011, these are also their top two areas for concern this year.

“There is no doubt money is in motion, whether from investors moving firm relationships or brokers and advisors going independent and bringing client assets with them,” said Bobbi Masiello, executive vice president, relationship management, National Financial.  “Regardless of the business model they choose, we are able to work closely with our clients to offer them the resources, such as a sophisticated technology platform, they need to help them aggressively recruit brokers and advisors, as well as attract affluent investors.”

Planning for Succession
The Fidelity poll finds that more than half (53%) of broker-dealer and RIA firms do not have a long-term succession plan for their business in place.  Thirty percent state they have an agreed upon succession plan to pass their business on to senior team members, while 15 percent are currently exploring opportunities with a potential merger partner. 

About the Poll
The Fidelity 2011 Executive Forum Poll was conducted May 2-4, 2011, using iPads provided by Results Imperative. On average, 130 Executive Forum attendees responded to each question.  Fidelity invited advisor and broker-dealer clients to the Executive Forum. The results of this poll may not be representative of all advisors meeting the same criteria as those surveyed at the Fidelity 2011 Executive Forum.

About Fidelity Investments
Fidelity Investments is one of the world’s largest providers of financial services, with assets under administration of more than $3.7 trillion, including managed assets of nearly $1.7 trillion, as of April 30, 2011.  Founded in 1946, the firm is a leading provider of investment management, retirement planning, portfolio guidance, brokerage, benefits outsourcing and many other financial products and services to more than 20 million individuals and institutions, as well as through 5,000 financial intermediary firms.  For more information about Fidelity Investments, visit www.fidelity.com.
 

Results Imperative is an independent company, unaffiliated with Fidelity Investments or any of its affiliates.

Fidelity, Fidelity Investments, the Pyramid Design logo, Fidelity Institutional Wealth Services and National Financial are registered service marks of FMR LLC.

Clearing, custody or other brokerage services may be provided by National Financial Services LLC, 200 Seaport Boulevard, Boston, MA 02210 or Fidelity Brokerage Services LLC, 900 Salem Street, Smithfield, RI 02917, Members NYSE, SIPC.

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