The Misconceptions of Independence- Volume 2

“I don’t think independent firms have the same scope of investment options.”

There is a belief by many advisors out there that the large wirehouse firms have the biggest scope of options. We have transitioned 13 advisors in the past 3 years and this was always their initial thought as well. Whether they focused on individual bonds, annuities, alternative investments or just general money management, the belief was they might be taking a step down. Once they made their transition they soon realized that their universe of options became larger. Many of you may think that is not possible. One of our current advisors put it in perspective best for me. He said, “My old firm was like a big brand name department store. The shelves were packed with different products from a multitude of different companies. The universe of options felt robust and endless. When I took a step back and started to think about it, the ‘department store’ controlled what went on the shelves. The endless options were, in fact, limited to who was allowed to be on the shelf. There was little transparency on why those products were approved and whether or not conflicts of interest existed.”

True independence means your investment options include the full universe of what is available. You are only limited to the investment strategies or products that you choose to accept. At Integrated Wealth Management we are a Registered Investment Advisory firm (RIA), which operates as a fiduciary. We feel in order to be a fiduciary there needs to be a true “open architecture” that allows our advisors to act in the best interest of their clients. The advisor has the ability to do their own due diligence, as well as leverage both Integrated Wealth Management’s and our custodian partner’s due diligence. At the end of the day, the advisor creates the products and services that will be on “their shelves” and decide what is best for their client.

When an advisor makes the decision to explore being independent it is important to see how your business translates in an independent world. This means not only your approach to managing your clients’ assets, but also the specific funds and strategies you use for your clients. You will quickly see that most, if not all, of your funds and strategies will translate well. The only investments that typically don’t translate are proprietary strategies created specifically for your firm.

If you have any questions, please feel free to reach out to me anytime.  Stay tuned for the next “misconception.”

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