The majority of investment advisory firms' main offices are concentrated in a relatively small number of states, with the distribution likely driven by access to financial markets, population and net worth.
The Investment Adviser Association and National Regulatory Services' recently released Evolution/Revolution report, which is based on Form ADV, Part 1 data filed by all advisors registered with the Securities and Exchange Commission as of April 7, found that states considered to be financial hubs, like New York and Massachusetts, are, obviously, attractive spots for advisors to be located.
Proximity to New York City is part of the reason that Connecticut and New Jersey rank high among advisor locations, but Connecticut's ranking is also influenced by the concentration of hedge funds located in the Greenwich and Stamford areas.
While Massachusetts is only the 14th state in population ranking, it has a high average household net worth and is the home of many advisors in the mutual fund industry. Texas' large population contributes to its high ranking on the list, while Los Angeles, San Francisco and Chicago are home to secondary financial hubs, which pushes both California and Illinois high among states that are home to advisory practices.
Read on to see the top 10 states by number of advisors headquartered.
10. Ohio
Number of advisors: 234
Average household net worth: $465,366
Net Worth Rank: 26
9. New Jersey
Number of advisors: 282
Average household net worth: $645,594
Net Worth Rank: 1
8. Florida
Number of advisors: 356
Average household net worth: $479,325
Net Worth Rank: 22
7. Connecticut
Number of advisors: 414
Average household net worth: $631,272
Net Worth Rank: 2
6. Pennsylvania
Number of advisors: 429
Average household net worth: $474,152
