It looks as if private equity investors aren't the only ones interested in buying into the financial advice industry. On Monday, hedge fund Lone Pine Capital said in a filing that it had recently acquired almost 2.3 million shares of LPL Financial Holdings Inc., the parent company of the eponymous broker-dealer, or almost 2.9% of LPL's shares (LPLA) outstanding.
Private equity investors have flooded into the wealth management and registered investment adviser industry in the past six years, driving up the valuations of large RIAs.
But it's not unprecedented for a hedge fund to buy shares and take a position in an publicly traded firm like LPL Financial Holdings. In 2015, activist hedge fund investor Marcato Capital Management took a 6.3% stake in LPL Financial Holdings, claiming at the time that LPL’s share price was undervalued.
Times have changed. When Marcato revealed its position in LPL Financial Holdings back in 2015, the shares were trading close to $42. Early Wednesday afternoon, share of the company were trading at $228, or more than five times the share price paid by Marcato.
Marcato Capital eventually shut down, according to reports.
Lone Pine Capital's position in LPL Financial Holdings falls short of the level that would require a new investor to release a statement about its position, as Marcato Capital did in 2015. Instead, the hedge fund disclosed its ownership stake in LPL Financial Holdings in a quarterly filing earlier this week with the SEC.
A spokesperson for the Greenwich, Connecticut-based hedge fund said Wednesday afternoon that the firm declined to comment. A spokesperson for LPL Financial Holdings did not comment.
According to the filing, Lone Pine Capital has 2,289,151 shares of LPL Financial Holdings, for which it paid $422.3 million. With shares of the brokerage and RIA firm trading around $228, the hedge fund's position in the company equals $521.9 million, so Lone Pine Capital has already made roughly $100 million on the trade.
According to its website, Lone Pine Capital was founded in 1997 and uses long/short as well as long-only investment strategies. It has $35.5 billion in assets under management, according to the most recent Form ADV it filed with the SEC, and Stephen Mandel is a managing director.
By listening for what truly matters and where clients want to make a difference, advisors can avoid politics and help build more personal strategies.
JPMorgan and RBC have also welcomed ex-UBS advisors in Texas, while Steward Partners and SpirePoint make new additions in the Sun Belt.
Counsel representing Lisa Cook argued the president's pattern of publicly blasting the Fed calls the foundation for her firing into question.
The two firms violated the Advisers Act and Reg BI by making misleading statements and failing to disclose conflicts to retail and retirement plan investors, according to the regulator.
Elsewhere, two breakaway teams from Morgan Stanley and Merrill unite to form a $2 billion RIA, while a Texas-based independent merges with a Bay Area advisory practice.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
