Creative Planning is "seeing record inflows in terms of numbers of clients, in terms of assets" across all the demographics of clients the firm works with, CEO Peter Mallouk told Thinkadvisor on Tuesday. But he is looking ahead cautiously to how the Federal Reserve's unwinding of stimulus will play out in both the RIA space and investors at large.
Mallouk shared his outlook with ThinkAdvisor in an interview discussing Creative's acquisition, closed Dec. 31, of Reilly Financial Advisors, an RIA with more than $2 billion in assets under management based in La Mesa, California. Creative Planning has more than $100 billion in assets under management.
Meanwhile, stock prices fell and Treasury yields jumped Tuesday over concerns that central banks will move to boost interest rates earlier than expected. The S&P 500 fell 1.6%, the Dow Jones Industrial Average 1.8% and the Nasdaq 2% by 3:50 p.m.
More investors have been seeking financial advice, Mallouk said, and he predicts that will continue through 2022.
There are many new entrants into the financial services market that are experiencing wealth for the first time that were in "very risky assets" like cryptocurrencies who "never really experienced something super negative," he said. As a result, he predicted: "There could be some eye-popping moments this year if the great unwinding doesn't happen according to plan."
To investors, all companies tend to look good in such a low-rate environment, according to Mallouk. But, as rates start to rise, "people will have to get back to being more selective about how they construct portfolios and they're going to start to become more judgmental around how their money managers are performing," he predicted.
