Wirehouses are losing out to registered investment advisors, broker-dealer mega teams and home-office due-diligence relationships when it comes to capturing marketshare.

That’s according to a report from Boston-based research firm Cerulli Associates, “U.S. Intermediary Distribution 2016: Evolving Roles in Distribution,” which found that growth on the part of the winning channels is driving a move toward more sophisticated, investment- and data-focused interactions that have traditionally been reserved for firms operating within the institutional space.

When it came to growth, Cerulli found that, in 2015, the independent registered investment advisor channel grew assets faster than any other advisor channel, experiencing growth of 6.2 percent compared with an average of 0.9 percent for all channels.

In contrast, the wirehouse asset base during 2015 shrank by 1.9 percent, ranking as the poorest-performing advisor channel in terms of asset growth.

Cerulli projects that within these areas of growth, the registered investment advisor and hybrid registered investment advisor channels combined will increase their asset marketshare from 23 percent in 2015 to 28 percent in 2020.

“While wirehouses still hold a substantial share of assets, RIAs are the growth story,” Kenton Shirk, associate director at Cerulli, said in a statement. He continued, “To build a relationship within an independent practice, wholesalers need to truly understand a firm’s investment philosophy and decision-making process.”

Because of consolidation and increasing focus on due diligence, the report said, partner-firm relationships have become more complex. Nearly a third (27 percent) of national sales managers have already reduced the number of partner firms covered by each key accounts manager, and 47 percent describe this effort as a priority.

“In our survey of national sales managers, 67 percent rank increasing the technical skills of existing wholesalers to address more sophisticated advisor teams as the top priority,” Emily Sweet, senior analyst at Cerulli, said in a statement. Sweet added, “We believe this expanding institutional influence in the retail market, especially in the areas growing most quickly, will continue for the foreseeable future.”

Instant Insights /

RIAs growing market share while wirehouses shrink: Cerulli

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