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Client Service November 21, 2016
Forty Percent of Advisers Are Now Fee-Based
Among this set of advisers, fees are the biggest factor driving loyalty.
Reported by Lee Barney
Forty percent of advisers are fee based, according to
Advisor Brandscape, a Cogent Reports study released by Market Strategies
International. While consistency of fund performance and having a distinctive
investment philosophy are important to registered investment advisers, fees and
expenses are the No. 1 reason why they select an adviser from among those who
are fee-based.
“Firms overlook this group of advisers at their peril,” says Meredith Lloyd
Rice, a vice president at Market Strategies and author of the report. “We’ve
heard from many advisers who feel the DOL [Department of Labor] fiduciary rule
is pushing them toward a fee-based compensation structure. For mutual fund
managers seeking to secure and strengthen relationships with these high-end
producers, highlighting consistent, long-term investment performance and value
for the money is even more important to covey.”
Among fee-based advisers, the top 10 mutual funds that earn their trust the
most, in descending order, are: DFA, Vanguard, T. Rowe Price, DoubleLine, American
Funds, JP Morgan Funds, MFS Investment Mangaement, BlackRock, Legg Mason and Franklin
Templeton.
The Cogent report is based on an online survey of 1,460 advisers conducted between January and March of this year.