Cerulli finds only 7% of advisers at right scale to do portfolio construction themselves

Cerulli finds only 7% of advisers at right scale to do portfolio construction themselves
Research firm says advisory firms need at least $250 million in AUM to do proper job.
OCT 17, 2019
While 62% of advisors and 55% of all practices rely on their own investment research and portfolio construction, Boston-based research firm Cerulli Associates believes that only 7% of those advisory practices are at an optimal scale to perform those functions. [More: Technology can help balance adviser portfolio discretion with firm controls] That rarified group says, Cerulli says, typically have an average account size of at least $2 million and assets under management greater than $250 million, although practices that can genuinely customize portfolios skew closer to the $500 million range, the firm said in a release based on a recent survey of advisers. [Recommended video: Advisers should discuss ESG with wealthy clients before someone else does] The firms most suited to do their own research and portfolios also tended to have a team-based environment, "staffed with layers of stakeholders and asset-gatherers supported by the resources needed to customize portfolios, retain existing relationships, attract new clients, and build rapport with families' beneficiaries and outside advisors," Cerulli said. Don't miss our Women Adviser Summit — coming to San Francisco.​

Latest News

SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees
SEC charges Chicago-based investment adviser with overbilling clients more than $2.5M in fees

Eliseo Prisno, a former Merrill advisor, allegedly collected unapproved fees from Filipino clients by secretly accessing their accounts at two separate brokerages.

Apella Wealth comes to Washington with Independence Wealth Advisors
Apella Wealth comes to Washington with Independence Wealth Advisors

The Harford, Connecticut-based RIA is expanding into a new market in the mid-Atlantic region while crossing another billion-dollar milestone.

Citi's Sieg sees rich clients pivoting from US to UK
Citi's Sieg sees rich clients pivoting from US to UK

The Wall Street giant's global wealth head says affluent clients are shifting away from America amid growing fallout from President Donald Trump's hardline politics.

US employment report reactions: Overall better than expected, but concerns with underlying data
US employment report reactions: Overall better than expected, but concerns with underlying data

Chief economists, advisors, and chief investment officers share their reactions to the June US employment report.

Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading
Creative Planning's Peter Mallouk slams 'offensive' congressional stock trading

"This shouldn’t be hard to ban, but neither party will do it. So offensive to the people they serve," RIA titan Peter Mallouk said in a post that referenced Nancy Pelosi's reported stock gains.

SPONSORED How advisors can build for high-net-worth complexity

Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.

SPONSORED RILAs bring stability, growth during volatile markets

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.