Handful of distributors winning IRA rollover wars

A handful of distributors are seeing a rising tide of wealthy-client assets going into individual retirement accounts. The proportion of wealthy investors' total assets in IRAs climbed during 2009. IRAs now account for 31% of the total assets of affluent investors, according to data supplied by Cogent Research LLC. In 2006, they made up just 26% of wealthy investors' total assets. Cogent also found that over the last year, firms raised the proportion of primary client assets held in IRAs by an average of 15%. What's more, seven firms managed to raise the average proportion of primary client assets in IRAs by at least 20%. That group includes Fidelity Investments, ING Groep NV, Merrill Lynch & Co. Inc., Raymond James Financial Inc., USAA Investment Management Co., The Vanguard Group Inc. and Wells Fargo Advisors. Of that bunch, ING appears to be making up considerable ground in the rollover wars. The company reported the largest percentage increase in primary client assets going into IRAs, with a gain of 37.4%. Even with that gain, ING still holds only about 28% of the firm's primary client assets in IRAs. According to Cogent, nine companies hold one-third or more of their individual primary clients' assets within IRA accounts: Ameriprise Financial Inc., Charles Schwab & Co. Inc., Edward Jones, Fidelity, LPL Financial, Merrill Lynch, Raymond James, UBS AG and Vanguard. Vanguard and Fidelity are at the top of the pile in terms of asset retention — that is, participants who have a retirement plan with one distributor who is likely to enter a rollover IRA with that firm. “Vanguard and Fidelity have a built-in advantage because their market penetration is so large,” Meredith Lloyd Rice, senior research director at Cogent Research, said.