Broker Dealer Change: Unlocking Portfolio Flexibility and Growth

Making a broker dealer change can be a game-changer for your portfolio, offering a range of benefits that can help you achieve your financial goals.

By switching to a new broker dealer, you can potentially save thousands of dollars in fees. According to our research, the average investor can save up to 75% of their annual fees by making a broker dealer change.

One of the key advantages of a broker dealer change is the ability to access a wider range of investment products and services. This can be particularly beneficial for investors who are looking to diversify their portfolios or explore new investment opportunities.

A broker dealer change can also provide you with greater flexibility in terms of account types and management options. For example, some broker dealers offer robo-advisory services that can help you automate your investing and reduce costs.

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If your current broker dealer is stuck in survival mode, it's time to make a change. They're losing more advisors than they add per year, which can negatively impact the quality of service you receive.

You deserve better than just getting by with the status quo. Transition to a broker dealer that's proactive and committed to progress, and you'll reap the rewards of improved customer service and access to tech innovations.

A limited range of services can also be a major red flag. If your firm needs diverse services, but your current broker dealer isn't meeting your demands, it's time to pivot to a new one.

Stagnation is a major red flag when it comes to your broker dealer. A lack of progression can hinder your ability to compete.

Merely getting by with the status quo is not enough, as it can lead to a decline in the quality of service provided. If your current broker dealer is losing more advisors than they add per year, it's a sign that things need to change.

You don't have to settle for just enough - it's time to switch to a new broker dealer that's not satisfied with merely being in survival mode. This will give you access to improved customer service, innovative technology, and top-quality service that will help your business excel.

Portfolio flexibility is crucial for financial advisors who want to provide top-notch service to their clients. A broker dealer that offers flexibility in portfolio management can make all the difference.

Having full control over investment decisions is a must for some advisors. If your current broker dealer restricts your ability to customize strategies, it's time to consider a change.

Investment options are also a key factor in portfolio flexibility. A broker dealer that offers a diverse range of products, including alternative investments and flexible fee-based options, is a step in the right direction.

At the end of the day, you want a broker dealer that aligns with your portfolio management philosophy. Don't settle for a firm that doesn't share your vision for working with clients.

A broker dealer that allows advisors to choose between managing portfolios themselves or leveraging the expertise of the firm's asset management team is a great option. This flexibility can help you stay competitive and provide the best possible service to your clients.

For more insights, see: What Is an Investment Broker

Our Execution Strategy is designed to help you navigate the process of changing your business structure. We'll assist your team or take on the full responsibility of preparing, filing, and facilitating Rule 1017 applications.

Our team of experts will prepare and submit the Rule 1017 application and Business Plan, ensuring it meets all the necessary standards. We'll also review the membership agreement to ensure everything is in order.

We'll determine the structure of the new organization, taking into account the unique needs and goals of your business. Our team will act as your liaison with the FINRA District Office, facilitating the application process and keeping you informed every step of the way.

Here are the specific services we offer to support your new business structure:

By working with us, you can move forward with your new business idea, product, or partnerships without delay.

If your current broker dealer is limiting your services, it's time to pivot. A broker dealer with limited services can hinder your business growth.

The breadth of services offered by a broker dealer is just as important as the quality of those services. If your firm needs diverse services and your current broker dealer isn't meeting your demands, it's best to transition to a more comprehensive one.

Insufficient investment and account options can also be a significant issue. If there are too few products available or the broker dealer is inflexible, it's time to look for a new partner that can provide diverse options.

High expenses are a clear indication it's time to change broker dealers. Particularly high expenses or expenses that aren't justified can be a major red flag.

You might find your current broker dealer's fees are eating into your take-home pay. If your firm pays you 90% at an independent broker dealer or 40%-50% at a wirehouse or regional firm, never look at the payout.

Instead, evaluate what you take home as compared to the actual gross revenue you generate. Those numbers and their differences can be eye-opening, helping you realize what you're really being paid.

This exercise will help you analyze what services or benefits you're paying for and if you think it's of value. If you're paying for services you don't use, it may be time to evaluate other firms.

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Limited services can be a significant limitation of your current broker dealer. If your firm needs diverse services and your current broker dealer isn’t meeting your demands, pivot to a broker dealer that provides the services your business needs to thrive.

Investment and account options are particularly important. If there is an insufficient number of products available, or if the broker dealer is inflexible, transition to one that provides diverse options.

A broker dealer that offers alternative investments or flexible fee-based options can be a game-changer for your business. These options allow you to manage portfolios on a discretionary basis, giving you more control and flexibility.

Don't settle for a firm that doesn't share your vision as to how to work with your clients. There are many broker dealers in the marketplace that can provide the services you need to succeed.

A lack of technical innovation in your broker dealer can be a major limitation. This can lead to wasted time and money on manual processes.

Few automation options or simple automation features can hinder your productivity. Choose a broker dealer that has fully embraced automation.

A firm that uses e-signatures, for instance, allows you to go paperless and saves you time and money on paperwork and storage.

High-tech automated features empower you to exert full control over your operations. This can make the switch to a new broker dealer worth the time and effort.

Your broker dealer should offer a suite of technology tools, including portfolio management software and financial planning platforms. These tools can streamline your operations and make it easier to manage and scale your practice.

Integration with multiple custodians and reporting tools are essential for efficient operations. A client portal that allows for better client engagement is also a must-have.

If your broker dealer's technology stack is lacking, you may find yourself spending more time on administrative tasks. This can leave you with less time to focus on growing your client base.

The Broker Protocol is an important agreement between firms that was established in 2004 to provide guidance on client data during advisor transitions.

It was intended to ensure smoother transitions for advisors and prevent unnecessary litigation.

The Protocol outlines specific client data that can be retained in a move, giving advisors leaving Protocol firms some protection.

Advisors can create a spreadsheet to bring with them and use to solicit clients following their transition.

Not all firms participate in the Broker Protocol, so it's essential to understand the specific rules and regulations of each firm.

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Leaving a non-protocol firm can be a complex process, and it's essential to adhere to one's employment agreement to avoid any potential issues.

Contractual obligations, such as restrictive covenants, prohibit advisors from bringing client data with them or soliciting their clients.

Advisors must procure client information from public sources and work with their new firm and attorney to devise a strategy for informing and retaining their clients.

Clients can be informed that legal and contractual obligations prohibit them from speaking about the move in advance.

A knowledgeable attorney and a thoughtful approach to the process can help execute a safe and successful transition.

AdvisorLaw's expert team offers confidential services to help advisors conduct due diligence and make informed decisions to protect themselves.