RIA firms grew, owners too, in '06

Registered investment advisory firms — and their owners-did well last year. RIA firms grew assets by 15% last year, and revenues by 18%, according to a study released today by Rydex Investment's AdvisorBenchmarking unit in Rockville, Md. Compensation for principals grew as well, to 45% of RIAs' expense allocations, up from 40% in 2005. “It looks like advisers gave themselves a raise,” said Lori Klash, a spokeswoman for Rydex. That caused profit margins to fall for the first time in five years, according to the study, part of a series. Some 71% of advisers raised their fees last year. Minimum account sizes, for firms that have them, increased to an average of $408,000 last year, up from $345,000 a year earlier. AdvisorBenchmarking surveyed 913 advisory firms between February and May.