Independent RIAs helped TD Ameritrade bring in record net new client assets of $26.5 billion in the company’s fiscal first quarter ended December, up 42 percent from $18.7 billion in the same quarter a year ago.
Client assets reached $1.19 trillion, up from $773.8 million in December 2016, TD reported Tuesday.
Results include the addition of Scottrade, which TD acquired in September. The quarter ended December was the first full quarter that included Scottrade results.
The company’s RIA custody business contributed about 80 percent of the net new asset flows, as has been the case historically.
Advisor growth came from all sources—existing advisors, recruited RIA firms and breakaway brokers, said Tim Hockey, TD Ameritrade chief executive officer, in a call with analysts Tuesday.
Hockey said the move by some wirehouses to pull out of the recruiting protocol won’t impact the strong trend toward independence.
“Generally, our breakaway brokers tend to come from the independent broker-dealer space,” he said. Some recruits are “re-assessing” their moves, “but it doesn’t necessarily change their long-term direction. It’s been pretty much a one-way flow. There’s not many RIAs that go back to the broker-dealer space—I think we’ve only had one client whose ever done it in our entire history.”
The company’s pipeline of RIA recruits “is pretty full,” Hockey added.
With the bull markets, investor activity has picked up as well.
Cash levels at both the institutional and retail businesses are at historically low levels, TD executives said, with trading among retail investors at record levels, and interest in blockchain and cannabis-related securities driving a “surge in engagement in the final weeks of the quarter, particularly among first-time investors,” Hockey said in a release.