The RIA giants: $124B in assets and counting

50 largest firms are optimistic despite scant 2Q asset growth

Sep 20, 2009 @ 12:01 am

By Charles Paikert

Assets managed by the 50 largest registered-investment-advisory firms grew by a barely perceptible 0.4% during the second quarter, according to research conducted by RIA Database for InvestmentNews. At these RIAs, total assets increased slightly to $124.4 billion as of June 30, from $123.9 billion at the end of March, while discretionary assets edged up to $102.6 billion, from $102.2 billion. The ranking of the top 10 RIA firms remained the same, led by Veritable LP, which had $7.6 billion in discretionary assets at the end of June. Silvercrest Asset Management Group LLC, which meanwhile had $5.8 billion in discretionary assets, remained in the No. 2 spot. Executives at both firms stressed that their emphasis on working closely with clients after the financial markets collapsed a year ago allowed them to build stronger relationships. “We've talked a lot with clients, and we try to continuously clarify the approximate level of risk of each one,” said John Scuteri, a Veritable partner and its chief operating officer. The firm re-ported 2,415 discretionary clients for the second quarter.

“This business is about giving clients your best thinking in a way that reflects that you understand that it's their money, and not your money,” said G. Moffett Cochran, Silvercrest's chairman and chief executive. “The client has to be comfortable with the advice they're receiving.”

Silvercrest reported 2,310 discretionary clients June 30.

The market shakeout and problems at large Wall Street firms have attracted an unusually large number of prospective clients, according to the executives.

“We've seen a lot of prospective clients this year — more than I can remember in the recent past,” Mr. Scuteri said. “They're being very thoughtful and thorough in their due diligence, which is taking longer than usual, but that's a good thing, because they have a higher degree of confidence if they do become clients.”

Mr. Cochran also noted a “surge” in prospects.

“People have been disappointed with the [investment] performance they've seen, and they also feel they weren't getting the service and responsiveness they felt they were entitled to,” he said.

LUMINOUS GROWTH

Luminous Capital LLC was one of the fastest-growing firms among the top 50 RIAs, increasing its discretionary assets 73% to $2.6 billion, from $1.5 billion at the end of the first quarter.

“Their growth has been very impressive,” said Julie Cooling, founder and chief executive of RIA Database.

SCS Capital Management LLC also drew praise from Ms. Cooling, who noted that the firm placed third on the top 50 list, with $5.6 billion in discretionary assets and just 104 discretionary clients.

Investment banker Steven Levitt, managing director and co-founder of Park Sutton Advisors LLC, agrees.

“They have grown the business aggressively in a matter of just a few years and have provided a counter-example to those who say a high-net-worth business is inherently slow to grow,” said Mr. Levitt, who expects to see continued growth from SCS and other emerging independents in the second half of the year, reflecting the stock market's recovery.

Boutique asset managers with “solid reputations” and $1 billion or more in assets are particularly poised to benefit, “given clients' desire for high-level service and stability,” he said. “They will also benefit from the tarnished reputations of the wirehouses and many banks.”

Independents are also poised to take advantage of the “enormous disruption” in the advisory industry in the second half of the year, Mr. Cochran said.

“If we can convert the meetings we're now having into actual clients, what's happened may prove in hindsight to be a wonderful opportunity for us,” he said.

E-mail Charles Paikert at cpaikert@investmentnews.com.

WEB EXCLUSIVE To view a complete list of the biggest registered-investment-advisory firms, the fastest-growing firms, up-and-coming firms and a regional breakdown of large RIAs, go to investmentnews.com/riagiants.

0
Comments

What do you think?

View comments

Recommended for you

RIA Data Center

Use InvestmentNews' RIA Data Center to filter and find key information on over 1,400 fee-only registered investment advisory firms.

Rank RIAs by

Upcoming Event

Jul 10

Conference

Women Adviser Summit

The InvestmentNews Women Adviser Summit, a one-day workshop now held in four cities due to popular demand, is uniquely designed for the sophisticated female adviser who wants to take her personal and professional self to the next level.... Learn more

Featured video

Events

Behind the scenes at Pershing Insite 2018

What goes on behind the scenes at one of the industry's biggest conferences? Join us for an all-access sneak peek!

Latest news & opinion

Mutual funds feel the pinch of platform fees

No-transaction-fee options are a big hit with investors, but funds wind up paying the costs — and passing them on.

Divorce reduces retirement readiness

The new tax law could increase financial challenges for divorced people, but planning opportunities abound.

Merrill Lynch fined $42 million for misleading customers

In addition to the practice of 'masking' trades, the wirehouse went to extremes to cover up the wrongdoing.

Advisers with billions in AUM leaving Wall Street

Merrill Lynch has seen two teams exit recently, each with more than $4 billion in client assets.

Wells Fargo weighs changes to wealth unit

The move would reflect the bank's effort to cut $4 billion in costs.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print