Page 21 - Investment Advisor October 2022
P. 21
RIA
What’s Behind
Growth?
Industry VIPs break down RIA growth trends — from the wave of
dealmaking to other ways RIAs are expanding their practices.
BY JEFF BERMAN
alk about a growth story: The number of invest- “Main Street”-style firms in 2021, with 50 employees or less,
ment advisors registered with the Securities and according to the report. In terms of geography, gains in the
TExchange Commission, the number of clients they number of advisors based in the South “have outpaced gains
served, the assets they managed and the number of people in other parts of the country,” it says. “The growth in Florida
they employed all reached record highs in 2021, accord- was the strongest in the nation, while New York numbers
ing to a report released earlier this year by the Investment have fallen.” (Florida has 737 firms in 2021 vs. 636 in 2020.)
Adviser Association and National Regulatory Services. Meanwhile, assets under management by SEC-registered
The tally of SEC-registered investment advisory firms firms grew roughly 17% to a record high of $128.4 trillion
increased nearly 7% in 2021 — or by 926 firms from 2020 — in 2021. Industry assets have increased in 18 of the past 21
to 14,806 firms, the “Investment Adviser Industry Snapshot years, declining only in 2002 and 2008 because of market
2022” report states. The number of SEC-registered firms conditions. As in prior years, almost all assets were managed
has increased in 19 of the last 21 years. Registrations on a discretionary basis (91.5% in 2021), the report said.
declined only in 2010 and 2011, when the minimum size The number of clients served by SEC-registered advisors
threshold for SEC registration grew to $100 million in assets grew close to 6.5%, reaching a record high of 64.7 million
under management from $25 million, the report noted. clients, including 53 million asset management clients.
The vast majority of advisors (88%) worked in smaller Meanwhile, some 60% of advisors provided asset manage-
OCTOBER 2022 INVESTMENT ADVISOR 19