Struck says Wisconsin generally conducts routine advisor examinations once every three to five years, which she says is comparable with the national average among states. It's estimated that the SEC examines investment advisors roughly once every nine years. And she notes Wisconsin is looking to hire an additional member for its existing staff of six examiners.
Define Your Target Market
An old saw says that luck is the residue of design. But financial advisors might say that growth is the residue of design. According to FA Insight's Growth By Design study, advisors are in growth mode again following the market downturn and the best firms are doing it not simply by cashing in on the market rebound, but by focusing on a target market that lets them pinpoint their time and money on more profitable clients.
The study shows the typical advisory firm (defined roughly as having 200 clients, $1 million in revenue and five staff members) expects to finish this year with a 6% rise in clients, a 13% jump in AUM and a 16% leap in revenue. They also plan to increase staff size from five to six employees.
The best firms, according to the study, generate significantly greater annual revenue growth and more owner income per dollar of revenue. The drivers of outperformance include less overhead expense as a share of revenue, more profit per client and greater productivity per staff member.
According to FA Insight, 30% of firms don't have a defined target market. "There are many different ways to define your target market, but the most important thing is to have one and to build your firm and client experience around that," says Dan Inveen, principal and research director at FA Insight, a Tacoma, Wash.-based consultancy.
For more information on the study, please visit http://www.fainsight.com.
Advising Celebrities Can Be More Pain Than Pizazz
(Dow Jones) Not every estate advisor wants a glittery clientele. For some old-line advisory firms, celebrity clients bring too many headaches. Stars can be highly demanding and, besides, the publicity that surrounds them has a way of turning negative--headlines about legal fights actors Larry Hagman and Nicolas Cage have had with their advisors are just two recent examples.
Over the years, a special model for managing celebrities' affairs has evolved, based on how entertainment works. Artists often are gone from home for stretches and a business manager is usually the gatekeeper, in charge of choosing other advisors, including investment managers and estate attorneys.
While a traditional firm may be hired to do a particular task like draft a trust or manage investments, it will not always rush in to take over the whole show.
"They don't specialize in it, and it is often very labor intensive," says Jonathan A. Karp, a shareholder at Reish & Reicher in Los Angeles. A business manager knows he is "signing up for 24/7 availability, whereas the traditional financial advisor often does not want to."