IN 29.03

SKY’S THE LIMIT

AFTER BUILDING SANCTUARY WEALTH INTO A $25 BILLION RIA, JIM DICKSON AIMS HIGH AGAIN WITH ELEVATION POINT Saluting

5-STAR FINANCIAL PLANNERS 2025

Editorial

Foes turn friends in blockbuster merger

LPL Financial and Commonwealth Financial Network are strange bedfellows. Previously archenemies in the battle for advisor talent, one is a behemoth with about 29,000 advisors and one is a boutique firm with about 2,900. No love is lost between the two. It’s akin to the New York Yankees buying the Boston Red Sox. Think about that. So, when news broke that Commonwealth had agreed to a $2.7 billion all-cash merger, reverberations were felt across the industry. The deal is arguably the most significant ever in the independent broker-dealer space and is a welcome change in tone for LPL after the sudden firing of former CEO Dan Arnold last year for alleged improper conduct. The instigation and rapid conclusion of the Commonwealth deal is also a major feather in the cap for Arnold’s successor, Rick Steinmeier. As InvestmentNews reported, Steinmeier

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got the ball rolling with a reach-out email to his opposite number, Joe Deitch, at Commonwealth around Christmas. Initially a meet-and-greet endeavor, it evolved, remarkably given the size of the deal, to a signed-andsealed agreement a little over three months later.

Wayne Bloom, previously CEO, will remain as the head of Commonwealth within LPL, while Steinmeier’s pitch to his new colleagues is that nothing will change. However sincere this is, given the differences between the two firms, skepticism will be rife. Commonwealth advisors now have a once-in-a-lifetime decision to make: join the behemoth that is LPL or seek another boutique. Ironically, given how the two firms have dueled for top advisors in the past, the challenge for the executives over the coming weeks and months is to open arms and make them all one big happy family. LPL’s target is to retain 90

“LPL has taken the adage of keeping friends close but enemies closer to another level”

For LPL, this is a coup. It now has access to Commonwealth’s secret sauce and advisors who routinely generate some of the highest revenues and organic growth rates in the business. For Deitch, a revered leader and business builder, this is the culmination of his life’s work. For Commonwealth’s advisors, this is a nervous time.

percent of their new advisors. LPL has taken the adage of keeping friends close but enemies closer to another level. This, however, fails to factor in the respect it clearly had for what Commonwealth was doing. Now these two combatants are on the same side, it’ll be fascinating to see whether they can contain the fallout.

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Power, Progress, and Leadership: The Women to Watch

The Women to Watch Awards recognize leaders who are setting new standards in financial advice. Their decisions shape markets, their strategies influence policy, and their leadership paves the way for the next generation. These awards highlight the achievements that redefine success and push the industry forward.

Celebrate a woman whose influence deserves recognition. Nominations close June 13.

Submit your nominations today.

TOP CONCERNS ABOUT USE OF AI IN ESTATE PLANNING

Despite the possibilities, Americans still broadly distrust AI-generated estate planning due to the emotional implications, questions about control, and privacy risks.

HYBRIDS LEAD IN NON-TRADITIONAL FEES

Whether through nancial planning fees, retainers, hourly billing, or monthly subscriptions, hybrid RIA rms are leading the way in terms of the share of advisors using alternatives to the traditional asset-based model of compensation, according to a survey by Cerulli.

HOW THE MAGNIFICENT HAVE FALLEN

After leading the S&P 500 to its peak in February, the Magni cent Seven tech and growth stocks exhibited a stunning fall from grace, with Elon Musk-led Tesla showing the worst peak-to-trough price drop as of March 13.

RETIREMENT ANGST RUNNING HIGH AMONG GEN XERS

Caught between the pressures of raising children and supporting elderly parents, Generation X Americans are feeling the least optimistic about retiring when and how they want. Just over half of sandwich-generation respondents in a recent Fidelity survey said they were con dent they could retire on their own terms.

How Americans feel about retirement prospects

Source:

Source:

Source: Cerulli Associates, The Cerulli Edge – The Americas Asset and Wealth Management edition, March 2025

EDUCATION PAYS DIVIDENDS Individual advisors who invest in themselves are apt to outclass the competition, new research shows. While those without IWI designations earn just about $570,000 on average, those who have the CIMA, CPWA, and RMA marks make just above $760,000.

Source: Reuters, “S&P 500 correction in six charts,” accessed March 19, 2025

NewsAnalysis

LAYOFFS LOOMING IN WILD 2025?

Wealth management job cuts at Edward Jones and Morgan Stanley are linked to a sinking stock market, tariff battles, and the unknown, say industry executives

BY BRUCE KELLY

With the broad stock market in decline at the start of 2025, on top of the uncertainty caused by President Trump’s global trade and tariff battles, some large financial advisory firms appear ready to cut staff and potentially reduce costs.

Morgan Stanley in March was considering cutting close to 2,000 employees, according to a report by Bloomberg News. That would be the bank’s first major workforce reduction under CEO Ted Pick.

Large financial institutions are particularly sensitive to rising costs because they eat into profits. The last time an industrywide pullback in staffing and hiring occurred was in the fall of 2023, well before President Trump’s unsettling tariff wars.

At that time, rising costs of acquisitions, higher salaries for employees, and competitive recruiting bonuses for financial advisors, along with the record spike in interest rates, were making it more costly to run large wealth management enterprises.

The Morgan Stanley cuts will take place across the firm, with the exception of its roughly 15,000 financial advisors, according to Bloomberg. Morgan Stanley has about 80,000 employees.

A Morgan Stanley spokesperson declined to comment on reports of layoffs at the bank.

Firms typically leave financial advisors alone when they decide to cut staff and reduce costs; advisors drive and create revenue and are therefore directly linked to a financial advice firm’s bottom line.

“There’s aways a certain level of fat to trim at firms”

ALOIS PIRKER, INDUSTRY CONSULTANT

Edward Jones in March also said it was cutting home office workers at its St. Louis headquarters as a result of a companywide restructuring, according to a report by KMOV news in St. Louis.

“As we continue our journey to serve more clients more completely, Edward Jones will be making changes to its home office structure to strengthen our collaborative, client-first mindset and alignment with our firm goals,” said a

statement from an Edward Jones spokesperson. “As we make changes to our structure, the size of our home of ce will be reduced.”

The spokesperson declined to give a speci c gure as to the number of employees who may lose their jobs.

“There’s aways a certain level of fat to trim at rms,” says Alois Pirker, an industry consultant. “An unpredictable environment leads to these cuts in staff.”

Adding to the dif culties, the broad stock market had a terrible rst quarter, which may have been expected after the S&P 500 posted annual returns in 2023 and 2024 of more than 20 percent.

The S&P 500 fell 4.6 percent in the rst three months of the year, while the Nasdaq Composite gave up 10.4 percent, according to multiple news reports. That was the worst quarterly loss for the S&P 500 since 2002 and the Nasdaq’s biggest decline since 2022, according to Investor’s Business Daily .

Still, the market’s bad start to the year only fuels concerns about layoffs at wealth management rms.

“Firms are buckling up for a rocky road ahead,” Pirker says. “Markets appear not as onedimensional as [in the] past decade.

“We were spoiled by those markets. Now, all of a sudden, rms are getting ready and saying we need to be in better shape if push comes to shove.”

Meanwhile, Goldman Sachs is also preparing its annual round of layoffs, this time with a focus

MARKET PERFORMANCE: AN UNPREDICTABLE ENVIRONMENT

*As

of April 2

Source: Macrotrends

“These recent layoffs are tied to the rst three months of the Trump administration and the uncertainty of the economy going forward”

SANDER RESSLER, ESSENTIAL EDGE COMPLIANCE OUTSOURCING SERVICES

on its vice presidents, according to a March report from the Wall Street Journal

“About 3 percent to 5 percent of the rm’s workforce is expected to be cut,” the report said. “Goldman’s overall head count, which ended 2024 at 46,500, is expected to remain at this year when factoring in hiring.”

And with the rise of arti cial intelligence, nancial institutions will cut many more jobs in the coming years.

“Global banks will cut as many as 200,000 jobs in the next three to ve years as arti cial intelligence encroaches on tasks currently carried out by human workers,” according to Bloomberg News.

Chief information and technology of cers surveyed earlier this year by Bloomberg indicated that on average they expect a net 3 percent of their workforce to be cut.

“Any jobs involving routine, repetitive tasks are at risk,” according to Bloomberg’s analysis. “But AI will not eliminate them fully; rather, it will lead to

workforce transformation.”

The peer group covered by the Bloomberg report included Citigroup, JPMorgan Chase & Co., and Goldman Sachs Group.

Others are still curious as to the full impact AI will have on the nancial advice industry and any potential future job cuts.

“I don’t think we have any clarity of what AI is going to be like in three to ve years,” says Sander Ressler, managing director at Essential Edge Compliance Outsourcing Services. “These recent layoffs are tied to the rst three months of the Trump administration and the uncertainty of the economy going forward.

“There’s still no clarity in the practicality of AI when it comes to the day-to-day job activities of employees at wealth management rms, although it does help overall with productivity,” Ressler says.

“But these recent job cuts are directly linked to short-term economics. We don’t know where we’re going with the economy, and people are scared.”

2023 2024 2025 (so far*)

S&P 500 Nasdaq Composite

Dow Jones

DOORS OPEN TO PRIVATE MARKETS

However, the realities of higher fees, less liquidity, and the retailization of ETFs mean financial advisors should tread carefully

BY JEFF BENJAMIN

As stock market volatility continues to pick up, financial advisors and their clients are being reminded of the benefits of diversification, and that’s drawing attention to the opportunities that exist in the private markets.

While private equity funds, including private credit and venture capital, have traditionally been restricted to wealthy individuals and institutional investors, the category is showing signs of moving down market to attract assets to help fund companies seeking capital outside the public exchanges.

Along those same lines, there is a movement among some asset managers to wrap exposure to private markets investing inside exchange-traded funds.

According to a new report from the consulting firm Bain & Company, 2024 marked the third consecutive year of declining fundraising in the private equity space. The 24 percent drop in fundraising last year pulled the fundraising down 40 percent from its all-time peak of $1.8 trillion in 2021.

With fundraising viewed as a lagging indicator, the Bain report is presented as a cautiously optimistic outlook for private equity, with an anticipated rebound in dealmaking activity.

For financial advisors, this all represents a near-perfect storm of opportunity to gain access to a traditionally exclusive club and its lesscorrelated performance.

According to data analytics firm Preqin, over the 10-year period through June 2024, private equity investors enjoyed a 15.4 percent internal rate of return, reflecting the annualized interest rate at which an initial capital investment grows to its ending value.

“Financial advisors’ ability to access private markets has increased dramatically in recent years,” says Joseph Spada, private wealth advisor at Summit Financial.

“Investment firms have created products with institutional pricing geared to retail investors by offering liquidity options, no drawdowns, lower minimums, and 1099 tax reporting,” he adds. “Investors generally must go through a financial advisor to access these funds.”

But the opportunities in private markets also come with new layers of challenges related to due diligence, suitability, and fiduciary duties.

“Wealth managers need to scrutinize what they’re really getting as alternatives managers look downstream to the retail and retirement

markets,” says Thomas Kiley, senior vice president at Calamos Investments.

“The private equity market is broad, and benchmarking can be a challenge, particularly when it comes to performing due diligence.”

A few realities of investing in private funds are higher investment minimums, higher management fees, and lockup periods that might limit liquidity to a few times a year.

Will Rockett, senior director of investment strategy at Mercer Advisors, says advisors should help clients gradually develop an allocation to private markets with a cautious focus on picking the right managers.

“In public equity markets, the difference between the best and worst fund managers can be relatively small, but in private markets there’s been a tremendous difference in returns between the topquartile and bottom-quartile managers,” he says.

In the private markets, there is often a reference to the illiquidity premium, which refers to the performance tradeoff that comes with the longer lockup periods. The added performance typically results from the portfolio manager not having to manage around

“Understanding the liquidity of [private market] investments is incredibly important”

WILL ROCKETT, MERCER ADVISORS

unpredictable redemptions that can come with daily liquidity.

Rockett believes in the diversification benefits of private markets investing as well as the potential for higher returns. “Understanding the liquidity of these investments is incredibly important,” he says.

Spada, of Summit Financial, says advisors have a responsibility to ensure clients fully understand the liquidity tradeoff. “Risk can vary greatly depending on the specific investment, but illiquidity is a risk that is consistent in private markets,” he says.

The liquidity trade-off, Spada explains, is the “opportunity for higher returns than traditional stocks and bonds, a hedge against inflation, and access to a broad universe of unique investments, asset classes and strategies enhancing portfolio diversification.”

If there was any doubt about the growing focus on private markets and the expansion beyond the wealthiest investors, recent activity in the ETF space should put that to rest. So far this year, two ETF issuers have launched funds designed to track the performance of private markets by investing in public companies.

“Financial advisors’ ability to access private markets has increased dramatically in recent years”

JOSEPH SPADA, SUMMIT FINANCIAL

The PEO AlphaQuest Thematic PE ETF (LQPE), which launched in January, employs an equity derivatives strategy to generate a proxy for private equity performance. The Pacer PE/ VC ETF (PEVC), which launched in February, is investing in public companies to generate a proxy for private equity performance.

And those launches were followed in March by the SPDR Bridgewater All Weather ETF (ALLW), which will directly allocate a portion of the fund’s assets to private investments.

Jake Miller, co-founder of Opto Investments, cites the string of ETF offerings as a level of retailization. But he makes a point about the dilution of private markets investing with the retailization trend.

“There are a growing number of access points that offer curated exposure to fiduciaries, and

there are also a growing number of liquid and semi-liquid options,” he says, describing the ETFs as being “on the far end of the spectrum.”

“We do not currently think ETFs [focused on private markets] are a good deal for advisors and their clients,” he says. “Some of these ETFs claim to track private markets, while holding purely public holdings but charging higher fees.”

Ultimately, Miller adds, the retailization of private markets will have to find a balance.

“Making something that is fundamentally illiquid liquid is hard, and it’s impossible without tradeoffs,” he says. “Those investors with any illiquidity budget are often better served by allocating smaller, digestible amounts to true private market products, eschewing the watereddown and more expensive options.”

NewsAnalysis

GETTING UP TO SPEED ON AI

Financial advisors are educating themselves on the potential uses of AI. Here’s how they are approaching what could very well be a game-changing technology

BY GREGG GREENBERG

Financial advisors are finally smartening up about the benefits of artificial intelligence.

Managing money for a living revolves around risk management, which is why wealth managers tend to be highly risk averse. Hang around the financial services industry for a while, and one will clearly discern that long-term success tends to be achieved by those practitioners who are cautious in their choices, whether they relate to an investment strategy or the latest office technology.

Seriously, do you think Warren Buffett has lasted six decades as the world’s greatest investor by day-trading IPOs and relying on the latest stockpicking software to manage his portfolio? Or did he grow Berkshire Hathaway into a $1 trillion-plus financial services behemoth by buying and holding blue chips, while sticking to his time-tested investing strategy of chugging Cherry Cokes and reading annual reports?

Exactly!

It’s quite clear that those perennially looking to go all in on the new, new thing (remember that gem of a phrase from the dotcom boom/bust?) don’t tend to last long on Wall Street. And that’s probably the reason why the financial advisor community eased its way into the world of AI instead of bounding in with both feet.

Now, however, it looks like the scale is tilting in favor of comfort and adoption on matters related to AI, as opposed to caution and inertia.

Case in point: Two years ago, Eric Ludwig, director of The American College Center for Retirement Income, would only get a smattering of hands when he asked groups of advisors if they were using AI in their practices. Fast-forward to today, and he sees 75 percent of hands go up.

“More financial planners are incorporating AI within their tools, whether FAs realize it or not, and I think that will be more the trend instead of standalone AI products,” Ludwig says.“In other words, AI could be part of an FA’s financial planning software as opposed to a separate product.”

For those who haven’t started using AI yet, Ludwig maintains that there are a few reasons why, but most commonly it’s that they simply don’t know how to get started.

BECOMING COMFORTABLE WITH AI

“Our comfort level varies with the functionality where AI is being used,” says Mohan Gurupackiam, chief information officer at Steward Partners. “There are areas, including chatbots, note-taking, and AI assistants, where we are very comfortable.”

Those technologies, along with cybersecurity, generally have a low entry barrier to usage and are more easily adopted. Gurupackiam adds that he is quite comfortable with using AI for opera tional efficiencies, such as in data extraction from documents.

Areas that are still emerging and awaiting regulatory guidance are where wealth managers may prefer to

wade in, rather than dive, according to Gurupackiam. Those include investment management and market research, where guidelines for establishing fiduciary responsibilities are still being developed.

Meanwhile, Dave Alison, president and founding partner of Prosperity Capital Advisors, has been using AI for the past three years and says he is very comfortable with its capabilities, so much so that he’s shifted his focus to improving his prompt-engineering with tools like ChatGPT.

“We are also using new AI tools in our business operations, such as Zocks for AI note-taking and creating automations for task and CRM management,” Alison says.

Likewise, Terry Parham Jr., co-founder and financial planner at Innovative Wealth Building, says he feels very comfortable with AI based on what he currently knows and uses it for. At the same time, however, he regularly asks AI about its most

useful features, lesser-known capabilities, or ways that it could support his business more effectively.

“I believe comfort comes from both learning and doing, so I’ve made it a priority to build knowledge while also gaining hands-on experience,” Parham says.

GETTING INTELLIGENT ABOUT AI

Gurupackiam says there are multiple areas that he monitors to educate himself on the latest AI innovations. As Steward is a “cloud-native rm,” he constantly keeps an eye on emerging marketplace applications in the cloud to identify and use them within its technology stack. He also periodically evaluates emerging wealth technology platforms to identify their potential for use within Steward and integrate them as needed.

Another way of learning about AI is by attending technology conferences and support groups. Dave Valdez, partner and chief operating of cer at Alaska

“More nancial planners are incorporating AI within their tools, whether they realize it or not, and I think that will be more the trend instead of standalone AI products”

ERIC LUDWIG, THE AMERICAN COLLEGE CENTER FOR RETIREMENT INCOME

Wealth Advisors, is a rm believer in the bene ts of attending industry forums and joining CEO/COO/CTO groups that stay current with all the changes.

“I see it being a huge productivity driver for research, communication, and task management,” Valdez says. “We also see it being a valuable tool for advisor development and training. It’s going to help us analyze data more ef ciently, both on our business and on our clients, so we can drive more value.”

Despite the increasing number of conferences nationwide dedicated to helping wealth managers improve their AI skills, Innovative Wealth Building’s Parham stays updated on the latest AI advancements without even leaving his desk. Instead, he watches YouTube tutorials, attends webinars, and explores content speci c to nancial professionals.

“The American College offers material focused on how AI can be applied in nancial planning, which

NewsAnalysis

AI’S PREDICTED IMPACT ON PRODUCTIVITY

Source: McKinsey & Company. Values are estimates

“Increasing wealth and willingness to use humancentric advice, as well as a declining advisor head count, add pressure to increasing efficiency in wealth management firms”

MOHAN GURUPACKIAM, STEWARD PARTNERS

helps me stay informed without having to spend hours doing research on my own,” Parham says. “I also follow AI experts on LinkedIn and other platforms to keep up with how they’re using the tools and what trends they’re noticing.”

THE PRICE OF AI ADMISSION

An education on Wall Street costs money, as the old

saying goes. And that doesn’t only apply to losing money on a stock or overpaying a fund manager. It also relates to spending on new technologies to keep pace with competitors.

The key with AI outlays, according to financial advisors, is to keep expenditure to a minimum as the technology evolves, without skimping so much that you’re left behind other IRAs. Parham, for example, says he is

not currently spending a significant amount on AI as many of the tools available are free or very low cost.

“That will likely change over time as more AI tools begin charging for advanced features, especially those related to customization and automation,”Parham says.

He adds that a lot of the software that advisors already use has AI built in, so many people are using AI without even realizing it – or feeling like they’re explicitly paying for it.

Alison says he spends between $150,000 and $250,000 on AI across Prosperity’s offices. Furthermore, he expects that number to greatly increase as the firm adds to its productivity and efficiency resources.

Alaska Wealth’s Valdez, on the other hand, doesn’t currently have a line item specifically for AI spending. However, he acknowledges that his overall technology spend – including on AI – is rising.

“I see bespoke technology architecture as a necessary future spend for our firm as we continue to enhance client experience, improve our depth in knowledge, and seek efficiencies,” Valdez says.

THE ULTIMATE VISION FOR AI

A recent McKinsey study estimates that the advisor shortage will reach around 100,000 in the next 10 years. Replacing all those advisors won’t be easy. Most likely, it will take AI to plug that big hole.

“Our industry is facing multiple challenges,” Gurupackiam says.“Increasing wealth and willingness to use human-centric advice, as well as a declining advisor head count, add pressure to increasing efficiency in wealth management firms.”

Not that AI will entirely replace the human touch of wealth managers. Heather Welsh, senior vice president at Sequoia Financial Group, says, “AI will allow us to further tailor our solutions to individual client needs. It will not replace the role of our advisors but, rather, will enhance their interactions with our clients.”

Finally, financial advisors are not expecting the AI revolution to culminate in a big disruptive bang either. For all the talk of displacement and dislocation due to AI, the widespread belief among wealth managers is that it will ultimately be used as just another tool to better serve clients.

“I envision it running quietly in the background, pulling real-time information that previously required manual research,” Parham says. “It could enable advisors and clients to meet in virtual environments and interact with their own financial data in real time. Tasks that currently take multiple steps could become seamless and instant, helping us create a more personalized and efficient experience.”

FINANCIAL 5-STAR PLANNERS

RUNNING THE SHOW

AMERICANS ARE facing a growing need for guidance and support in their nancial affairs, and that trend doesn’t look like it’s going to end anytime soon.

Not only are people wealthier, but their nancial situations are more complex relative to previous generations due to more retirees relying on savings, an increase in the range of products available, and the explosion in alternative investments.

Consulting giant McKinsey & Company estimates that “by 2034, at current advisor productivity levels, the advisor workforce will

decline to the point where the industry faces a shortage of roughly 100,000 advisors.” McKinsey data also shows that:

• the number of af uent households (with at least $500,000 in investable assets) will grow at four to ve percent per year, compared to 0.6 percent projected growth in the overall population

• the share of investors seeking more holistic advice grew to 52 percent in 2023 from 29 percent in 2018

That is mirrored by an increase of 6,500 in the number of Certi ed Financial Planners® (CFPs®) in 2024, bringing the total to 103,093 nationwide, according to a study published by the clientmatchmaking service SmartAsset.

Some states are particular hotspots:

• West Virginia had the highest rate of CFP® growth. Relative to its 2024 population, the past year saw a 12.5 percent increase.

• California is home to over 10 percent of all CFPs®. There are 10,511 people with an active certi cation, making the ratio of consumers to CFPs® about 3,707 to 1.

• Texas added the most CFPs® this past year, resulting in 374 more CFPs®

The sharp demand for their services has pushed InvestmentNews’ 5-Star Financial Planners to stand out in a dynamic market by exemplifying excellence, integrity, and dedication in helping their clients. They were nominated and then benchmarked against others to determine the country’s best.

While the winners have varying skill sets, a commonality is the most successful nancial planners specialize. They are serving a particular niche and have leveraged it to obtain a competitive edge.

Robert Westley –Northern Trust HNW master

Starting off at a public accounting rm, Robert Westley was tasked with advising high-net-worth (HNW) individuals and families on income taxes, which enabled him to develop a deep knowledge base.

“I was exposed to the whole ecosystem that surrounds wealthy families, some of the LLCs and trusts and foundations they set up,” says Westley. “My foundation in tax and accounting has really helped me, as a nancial planner, to better understand the ecosystem and tax rami cations of certain transactions.”

Source: McKinsey

Number of US advisors

Advisors needed Baseline under current trends

What drew him to the HNW and ultra-HNW world is its labyrinthine nature. He relishes the challenge of delving into clients’ affairs.

“Their balance sheets are often more complex than some multinational corporations’, with layers of trust and LLCs, and I nd that fascinating. I really like the puzzle and complexity of it,” he says.

That’s also what attracted him to Northern Trust, as he intentionally sought out a rm in the space. Where Westley shines and is a difference-maker is at the beginning with a new client. He adopts a forensic approach and leaves no stone unturned in understanding their complete picture.

He explains, “A lot of clients don’t necessarily have a road map of their nancial situation. My rst order of business is doing a deep discovery dive of combing through all their current investments, estate planning documents, income tax returns, and mapping it out where, on one or two sheets of paper, I capture all the assets.”

These can range from liquid and illiquid assets, private investments, life insurance, and tax-deferred accounts. Westley is also skilled at dealing with different generations of a family who stand to inherit. His role is not to dazzle them with gures but to provide them with an understanding of the structure and rationale.

“They don’t necessarily know the dollar amount but understand what it means for them in the event of their parents passing,” he says. “It’s so once there is an event where it is fully transferred to them, they’re prepared and understand the complexity.”

Due to the level of detail and elaborate nature of his clients’ nances, Westley has a small core base. This enables him to develop close relationships and be an integral part of their support structure.

He says, “I’m really in the weeds, and a lot of clients tell their spouse and children, ‘If anything ever happens to me, call Robert.’ When they have that con dence that there’s one person who really has the big picture, it helps them sleep better. For me, that’s a valuable part of the comprehensive nancial planning process.”

Tech is part of the conversation for all leading nancial planners, and while Westley is engaged, the nuanced nature of HNW work means he isn’t able to exploit it in the way some of his competitors are.

“We haven’t really found an off-the-shelf software that works, so we keep going back to Excel spreadsheets and have developed a lot of them that are customized,” he says. “There’s just so many different factors with trusts and LLCs, so there hasn’t been a perfect software solution where we’ve been able to just plug it in.”

Going forward, Westley has a subset of HNW clients – corporate executives – that he expects to need his services more. They are afforded large compensation packages and have tremendous wealth-building potential due to commonly being paid in stock options.

He says, “Their cash component is often very small compared to the overall compensation, which a lot of times is granted in equity. I help them make good decisions around that, so they’re left with a concentration, and then help manage and diversify that.”

Nichole Raftopoulos –Nvest Financial First-class service provider

Remaining free of con ict is Nichole Raftopoulos’s calling card.

After working at large rms, this leading nancial planner realized that pushing products didn’t motivate her. Eager to remain focused on serving clients, she formed Nvest Financial. The rm has clients across 26 states and is heavily focused on the New England seacoast and its retirement community. Its client base includes small business owners and those who are close to retirement or have already transitioned away from work.

Raftopoulos says, “We help people retire and we live with them during retirement. It’s not about checking boxes, it’s about changing lives.”

This approach ensures clients are listened to and supported. It’s normal for emails and cards offering gratitude to arrive at the of ce.

“The reality is we never take that for granted, and I’ll bring all those compliments back to the team and say, ‘Listen, remember, this is why we’re here,’” she adds.

What marks out the quality that Raftopoulos brings to the table is being able to communicate with the rm’s 900 clients. Naturally, she is not the lead planner for each case but works with her team, going through strategies, solving complex issues, and laying out scenarios.

This dedication means that each client receives the care and attention that Raftopoulos wants.

“When I’m working on cases with the advisor, we’re spending maybe half an hour on that, then they go back and deliver that beautiful experience, and I can work on the next advisor’s case,” she explains. “It leverages our skill set, and it continues to make sure our culture is growing and stays consistent with every single client experience.”

Having a single book of business is another of Raftopoulos’s initiatives. Every client is under the same umbrella.

“Any client of our rm is a client of all of ours. They might have a go-to person, but the clients know that I’m behind the scenes and I will have already met with them at some point. Every client feels that deep-bench approach,” she says.

Raftopoulos’s co-founder is husband George, but she has sole responsibility for the nancial planning operation. They are focused on remaining in control despite the trend of independents being bought out and joining big RIAs. The plan for Nvest Financial is to keep growing, and the rm is also looking at acquisitions but only if it’s a cultural t and value match.

“We get offers nonstop about being bought and becoming part of something bigger, but we really have that independent focus,” says Raftopoulos. “We really want to focus on our culture and what we do for our clients, and we don’t see that it ts

METHODOLOGY

Nominations required con rmation from the nominee’s compliance team to ensure authenticity and adherence to ethical standards.

InvestmentNews conducted a nationwide survey between November 18 and December 13 to recognize outstanding nancial planners in America. The survey sought nominations for nancial professionals who exempli ed excellence, integrity, and dedication in helping clients achieve their nancial goals. Participants were asked to provide detailed information on nominees, including professional credentials, areas of expertise, and signi cant achievements.

The IN team conducted an objective evaluation of each entry, assessing the detailed information provided. This evaluation also involved benchmarking against other submissions to determine the winners.

“My goal is always to be the guy who understands all the moving pieces”

ROBERT WESTLEY, NORTHERN TRUST

“We help our clients with every financial aspect of their lives. They have a true financial partner, they understand our process and are happy with it”

NICHOLE RAFTOPOULOS, NVEST FINANCIAL

a

lot of times

when you’re giving someone else control of your rm.”

“I try to approach each situation with an open mind, not constrained by the ‘optimal’ outcome”

EILEEN ALLGROVE,

FIDUCIENT ADVISORS

GROWTH IN THE NUMBER OF CFP® PROFESSIONALS BY STATE

Eileen Allgrove –Fiducient Advisors Wealth protector

Another standout performer who entered the industry by a circuitous route, Eileen Allgrove has made a name in estate planning and trusts. The law school graduate had an initial edge armed with deep legal knowledge

She says, “In some ways, that initial lack of a nance background helped me learn how it felt to be intimidated by something out of my comfort zone, and then take steps to acquire knowledge that I would apply. This is the same track I provide to my clients.”

Each case is part of the changing landscape that Allgrove faces, with families having different goals. To be able to deliver, she has to be an effective communicator.

She explains, “During my time as a trust of cer, I witnessed both good and poor family communication. Estate planning, particularly for those with signi cant wealth, is usually centered around tax savings, which requires mechanisms of control and secrecy.”

Part of her role is to prevent clients from adopting bad money habits, due to the feeling that someone else is controlling their wealth. This extends across the generations.

“By fostering communication, education, and understanding with the entire family, it’s more likely that there will be a successful transition of wealth,” says Allgrove.

When working with families that don’t have taxable wealth, she collaborates and meets all her clients as a unit annually.

“That way, when a health crisis or sudden death happens, everyone is better able to communicate and trust each other. There are some situations where family members aren’t ready for the full picture, and those are situations where we try to have more educational-focused meetings, to try to set the basics to prepare them for larger conversations in the future,” she explains.

Allgrove is a believer in not inundating clients

with info and won’t show them 60-page reports. Her approach builds the foundation and expands upon it. To do this, she has deployed various tech tools, such as MoneyGuide, Holistiplan, and NaviPlan, but uses eMoney more frequently.

She says, “I try to present the information in sections, meaning we start with net worth or balance sheet, and then move on to other topics as we proceed with the planning process.”

Providing clients with an improved understanding of their nancial picture and giving them greater con dence in their relationship with money is a successful result for Allgrove.

“I think some planners can be too focused on what makes sense from a tax, risk tolerance, or result approach,” she says. “I like to focus on where we are, what the goal is, and work collaboratively to make changes – big or small – to get there.”

Scott Van Den Berg, CFP®, ChFC®, CEPA®, AIF® –Century Management Future-focused expert

Shaping the firm in his own image has enabled Scott Van Den Berg to exploit his range of skills.

The Austin, TX-based organization, which is backed by a team of seasoned CFPs® and CFAs® with decades of experience, has a trio of specialties:

• retirement planning for business owners and individuals

• tax-ef cient income strategies for retirees

• real estate investment and strategic transactions

“We don’t just create a one-time plan – we stress-test it against multiple what-if scenarios. We go beyond the numbers to help clients navigate life’s nancial decisions with clarity and con dence,” says Van Den Berg.

It’s a highly customized approach, analyzing every detail of a client’s nancial life, including their equity and xed income investments, rental properties, and business interests.

A notable talent of Van Den Berg’s is assisting business owners in securing research and development tax credits and accelerating depreciation through cost segregation. This maximizes nancial ef ciency while ensuring full compliance with tax regulations.

He works closely with CPAs and tax professionals to analyze eligible activities, helping to ensure clients capture the full bene ts of innovationdriven expenses such as product development, process improvements, or software advancements.

“My role is to educate, help uncover qualifying expenses, and integrate the savings into a broader nancial strategy. For cost segregation and accelerated depreciation, I assess a client’s real estate holdings to identify opportunities to reclassify assets into shorter depreciation schedules,” he says.

GROWTH IN THE NUMBER OF CFP® PROFESSIONALS BY STATE (CONT’D)

“Clients need to know they have an advocate. By

consistently

being accessible, engaged, and transparent, we help them navigate financial decisions but also provide the peace of mind that they are never alone on their journey”

SCOTT

VAN DEN BERG, CENTURY MANAGEMENT

“Working with CPAs that specialize in this area, we help break down a property into its components, such as electrical systems, ooring, and HVAC. This helps clients accelerate depreciation, freeing up capital that can be reinvested or used to offset taxable income.”

In one particular case that Van Den Berg calls a “game changer,” he advised a small business owner to transition from an SEP IRA to a cash balance pension plan with a 401 (k).

“The key lies in understanding the limitations of SEP IRAs. While simple, they cap annual contributions at a much lower level than a cash balance plan, which allows for signi cantly higher tax-deferred savings,” he explains.

“For businesses with one to ve employees, a de ned bene t plan can be a great solution, whereas for companies with ve to 30 employees, a cash balance plan often provides greater exibility and ef ciency.”

After assessing the cash ow to con rm the business could sustain higher contributions, Van Den Berg worked with actuaries and third-party administrators to optimize tax savings while keeping costs manageable.

He says, “In most cases, business owners can save signi cantly more than they could with a SEP IRA, while also enhancing employee retention and bene ts. These custom pension strategies help business owners build wealth faster, reduce tax burdens, and create nancial security – all while supporting their employees.”

Alongside his team, Van Den Berg uses leading software, such as eMoney, Holistaplan, Horsesmouth, HiddenLevers, S&P Capital IQ, and Bloomberg, for deep analysis and datadriven strategies.

“By integrating cutting-edge technology with our decades of expertise, we provide clients with clear, strategic, and informed nancial guidance so they remain on track to achieve their nancial goals with con dence,” he explains.

Emotions are a big part of the game

Outside of their technical skill set, the 5-Star Financial Planners have to be empathetic and intuitive. They understand their clients and connect on a human level to address concerns, whether due to market volatility, life changes, or economic uncertainty.

Below, the winners explain how they’ve navigated and become adept at the softer side of the business.

Robert Westley: “It’s a learning process.You have to be there for clients when they go through life events. I’ve had clients that lost a child, which is God-awful. The interpersonal skills develop over time as you go through these situations. It’s about making yourself available as sometimes they just want to talk.You don’t necessarily have to give an answer, but it’s

reassuring for clients to know they can pick up the phone and have a conversation with you.”

Eileen Allgrove: “I am a working mother with young children, so stress is a constant. I have been in the industry for 25-plus years and experienced the tech bubble, the 2008 crisis, and the COVID-19 pandemic. What I have learned is to stick with your plan, be positive if things are not going in the expected direction, and be resilient and exible. And if you see someone struggling, be willing to listen and provide support and encouragement. Sometimes listening and allowing someone to get something off their chest is all that is needed.”

Scott Van Den Berg, CFP®, ChFC®, CEPA®, AIF®: “Financial planning isn’t just about numbers – it’s about people, their goals, and the emotions tied to their wealth. One of the most important ways we do this is by reminding clients of their long-term goals and helping ensure their nancial strategies remain aligned, no matter the market cycle. Clients need to know they are heard and understood. I always give clients my personal cellphone so they can reach me when needed. As a rm, we make it a priority to return every client call the same day – no one should feel ignored or left in the dark.”

5-STAR FINANCIAL PLANNERS 2025

John Benton

COO and Financial Planner, Chartered Financial Services LLC

Phone: 800 549 6007

Email: cfs@prudential.com

Website: cfs-nj.com

Robert Westley

Regional Wealth Advisor, Northern Trust

Phone: 212 339 7293

Email: raw8@ntrs.com

Website: northerntrust.com/united-states/home

Timothy B. O’Neill

Founder and CEO, Berthold Capital

Phone: 412 835 5450

Email: toneill@bertholdcapital.com

Website: bertholdcapital.com

Assunta “Susie” McLane

Managing Director, Senior Wealth Advisor, Summit Place Financial Advisors LLC

Phone: 908 517 5884

Email: assunta.mclane@summitplace nancial.com

Website: summitplace nancial.com

Danica Goshert, CFP®, AIF®, MBA

Senior Vice President, Private Wealth Manager, Integrated Equity Management

Phone: 952 854 5544

Email: danica@integratedequity.net

Website: integratedequity.net

Eileen Allgrove

Principal, Senior Consultant, Fiducient Advisors

Phone: 860 683 1187

Email: eallgrove@ ducient.com

Website: FiducientAdvisors.com

John R. Calvert III

Partner, Socium Advisors

Phone: 213 243 7137

Email: john.calvert@nm.com

Website: sa.nm.com

Nicholas Breit

Partner, Director of Financial Planning, Fiducient Advisors

Phone: 800 260 5445

Email: nbreit@ ducient.com

Website: FiducientAdvisors.com

Nichole D. Raftopoulos CEO and Founder, Nvest Financial

Phone: (207) 985 8585

Email: info@nvest nancial.com Website: planwithnvest.com

Scott Van Den Berg, CFP®, ChFC®, CEPA®, AIF® President, Century Management Financial Advisors

Phone: 512 636 2026

Email: svandenberg@centman.com Website: centman.com

Abiel Acosta Prospera Succession Partners

Alex Liss FS Advisors Wealth Management

Alex Petsis Anthony Petsis & Associates

Anthony Gerbi Stein Financial Group

Anthony Petsis Anthony Petsis & Associates

Becca Mathis Summit Place Financial Advisors

Daniel Tacktill Oppenheimer & Co.

David Brown Spectrum Planning Group

Dominic Hubert Schmidt Financial Management

Doug Greene Prentice Wealth Management

Eric Billimoria WealthCare Advisors

Eric J. Boyle Crest Financial Group

Gary Williams Williams Asset Management

George Webb Pension & Wealth Management Advisors LLC

Greg Thompson Stone Oak Wealth Management LLC

5-STAR FINANCIAL PLANNERS 2025

Hannah Varnado AmRET

Heidi Hirsch Anthony Petsis & Associates

Jeffrey Christakos Christakos Financial

Jen Swindler Money Illustrated Advisory Services

Jeremy DiTullio Cleveland Financial Group

Jerry Davidse, CFP® Presilium Private Wealth

Jim Shagawat AdvicePeriod

John Litscher The Capital Group

John Loyd The Wealth Planner®

Jonathan Harrison Swanburg TSA Wealth Management

Joseph Cilley Merit Financial Advisors

Julie E. Hall Vision Capital Partners

Kathy Longo Flourish Wealth Management

Kayla Rae Fernandez California Financial Advisors

Kofo Akosile Prudential Advisors

Lance Riddle Optimal Wealth Advisors

Louis Barajas International Private Wealth Advisors

Marc Butler Anthony Petsis & Associates

Marguerita Cheng Blue Ocean Global Wealth

Max Baer Merit Financial Advisors

Michael Randall Oak Summit Wealth Management (formerly Myers Financial Group)

Missie Beach Wiser Wealth Management

Natalie Colley Francis Financial Inc.

Nazzareno Spurio Prudential Advisors

Peter Lazaroff Plancorp Wealth Management

R. Patricia Grenier Grenier Financial Advisors

Robert C. Howland Howland and Associates LLC

Robert Campbell Kuttin Wealth Management (Ameriprise)

Robert Fragasso Fragasso Financial Advisors

Robert N. Auclair Balanced Wealth

Robert Reay Adams Wealth Advisors

Robyn E. Jameson Merit Financial Advisors

Ryan Dennehy California Financial Advisors

Ryan Gomendi Strategic Retirement Plans

Ryan Townsley Town Capital

Scott Oeth Cahill Financial Advisors

Stephanie Bucko Mana Financial Life Design

Steve O. Oniya OM Investments

Tony Pitzer, CFP® Merit Financial Advisors

William J. Prentice Prentice Wealth Management

ELEVATION POINT CEO JIM DICKSON REACHES FOR NEW HEIGHTS – AGAIN!

Dickson discusses his post-Sanctuary startup

BY GREGG GREENBERG

WITH ALL due respect to the great American author F. Scott Fitzgerald, who once wrote that “there are no second acts in American lives,” take a look at what Elevation Point CEO Jim Dickson is up to.

He’s already finished two wildly successful acts and is breaking out with his third.

Dickson co-founded Elevation Point with fellow Merrill Lynch alum and United Atlantic Capital chairman Mark Penske in 2024 to serve as a

“value-aligned growth partner” to independencefocused advisors and RIAs. Dickson had previously founded Sanctuary Wealth in 2018, quickly building it into a nationally recognized wealth management company.

In fact, Dickson built Sanctuary Wealth’s vaunted Partnered Independence platform, which provides advisors with the tools, services, and resources needed to effectively serve their clients. With Dickson at the helm, Sanctuary Wealth grew into one of the industry’s top RIA firms, with more than $25 billion in assets and

C-Suite

ELEVATION POINT AT A GLANCE

Home base: Minneapolis, MN

Employees: 55+

AUM: $4.2B

Offices nationwide: 5

76 partner firms in 28 states when he left the firm in 2023.

As for act number one, Dickson spent 20 years as a senior divisional executive at Merrill Lynch in Indianapolis and Chicago before chasing his entrepreneurial dream at Sanctuary Wealth.

But in this third act, however, Dickson is determined not to repeat the mistakes of his first two adventures in the investment management world. And believe it or not, he’s not looking to use the same aggregator playbook that vaulted him to such rapid success at Sanctuary Wealth.

“We are not aggregators,” Dickson says. “Aggregators simply combine businesses and buy income, which is not our approach. We’re not interested in fixer-uppers. Instead, we’re focused on partnering with those who believe they can improve, serve clients better, and grow faster. These are the opportunities we seek.”

Nor is he leaning on private equity capital to roll up those partners like he did at Sanctuary Wealth with the backing of Kennedy Lewis Investment Management. This time around he launched with family office capital instead.

“Not being tied to private equity gives us the flexibility we need to stick to our mission. Our investors are long-term investors who believe in the value we are providing to our partners, and the way we are providing it,” Dickson says.

WHAT’S THE (ELEVATION) POINT?

From a financial perspective, clearly Dickson didn’t need to dive back into the wealth management pool for a third time after he was abruptly terminated by Sanctuary Wealth in 2023 over allegations of conduct issues.

Regarding the split, he says: “The investors and I had a difference of opinion, and I learned the hard way about the risk of partnering with a capital provider that is not fully aligned from day one. I wish the firm well, and to my knowledge I remain the largest non-institutional shareholder.”

Still, despite his seemingly fractious departure from Sanctuary Wealth, Dickson chose to start Elevation Point with Penske, with the goal of offering a better solution for wirehouse advisors seeking independence and RIAs looking to scale. While many firms focus on full acquisitions, they saw an underserved market of advisors who wanted to monetize part of their business while maintaining control.

“Elevation Point was created to serve those

“Elevation Point was created to serve those advisors who are not ready to retire but want a partner to help manage and grow their business, while they still retain ownership”

advisors who are not ready to retire but want a partner to help manage and grow their business, while they still retain ownership,” Dickson says. “Our firm is committed to partnering with experienced independent advisors through minority-stake partnerships, providing support as RIAs and breakaway advisors navigate their transition to independence.”

Dickson highlights $200 million to $3 billion as the “ideal range” for firms he’s looking to partner with, or what he calls the “middle market.”

“It’s our sweet spot, and we like it for a couple of reasons. Number one, there’s a lot more of them to be able to invest in, and number two, it’s just a sweet spot in terms of growth,” he says.

Put simply, he wants to link up with firms that are not so large that growth-driven changes take years to execute, yet they operate with enough scale “to feel the momentum” when they are accelerating.

As for the minority-stake-partnership model he is waving in front of advisors to attract them to his new venture, Dickson says he’s looking for people who want to own 70 to 80 percent of an asset that will be much larger than what they could build on their own.

“For us, it’s about growing the entire pie. The pie will be so much bigger that their share will be

worth far more. Some people insist on owning 100 percent. That’s not what we’re looking for.”

THE INCAPACITATION OF FLUX

Dickson’s latest quest also gives him a new, and somewhat refreshed, perspective on the evolution of the RIA industry, seeing in a new light things he might have missed while toiling away at both Sanctuary Wealth and Merrill Lynch.

For example, he says advisors are no longer asking questions about old-school topics like compliance. Instead, they are desperately seeking answers and education around AI, data warehouses, and data leaks.

“The capital we invest in technology, AI, and automation is a major differentiator for us. The reality is that most firms in the middle market don’t have the resources or capacity to implement these themselves.”

When it comes to the impact of private equity players invading the RIA arena and pushing up valuations, Dickson believes many advisors who recently gave up control of their businesses now wish they hadn’t. As a result, he sees Elevation Point’s arrival on the scene as a “value-aligned partner” as perfect timing.

“Previously, deals were mainly based on ‘Who’s

Jim Dickson with Elevation Point co-founders Brad Smithy and Robert Tamarkin

JIM DICKSON AT A GLANCE

EDUCATION: Bachelor’s degree, accounting and finance, Butler University

MARRIED with four children

FOUNDED Elevation Point in 2024

PREVIOUS WORK HIGHLIGHTS:

• Founded and launched Sanctuary Wealth in 2018, which grew to $25B in assets by 2023 under his leadership

• 20 years as a senior divisional executive at Merrill Lynch, responsible for building and leading strategy

• Began his career as an accountant at Ernst & Young

ENJOYS: Golf, fishing, travel

going to pay me the biggest multiple?’” Dickson says. “Now, we’re at the point where it’s, ‘Who’s helping to make my client experience better?’ or ‘Who’s going to help me buy more over time so I can secure my unique exit from the business?’”

One thing that hasn’t changed since he left Merrill Lynch in 2017 to start Sanctuary Wealth, according to Dickson, is the flow of advisors from wirehouses toward independence. If anything, he

“Our firm is committed to partnering with experienced independent advisors through minority-stake partnerships, providing support as RIAs and breakaway advisors navigate their transition to independence”

says, it’s grown from a trickle to a torrent.

“I think the whole independent RIA space is mature, and that maturation has led to more optionality for advisors, but they also know so much more about the space,” Dickson says. “Just a few years ago there weren’t as many choices, but now there are more options, and with that comes more expertise and more lessons that can be learned.”

THE HEIGHT OF ELEVATION POINT

Striking entrepreneurial success once, as Dickson did with Sanctuary Wealth, is certainly nothing to take for granted. Few new ventures grow to such heights so quickly. The question then arises as

to what Dickson’s expectations are for Elevation Point and whether he would be disappointed if he was unable to raise or exceed the same level of AUM.

“I think we’ll know we’re successful when people talk about us defining the category. We’ll know we’re successful when RIAs say, ‘I want an Elevation Point experience,’ or, ‘I want someone like Elevation Point who can help me grow faster,’” Dickson says.

“For so long, this space has been defined by, ‘What multiple did you get?’ We’re trying to redefine that conversation to: ‘What could the valuation be, and how much fun could we have if we’re really successful?’ That’s the inspirational energy we aim to provide.”

Jim Dickson and Elevation Point employees

SectorFocus

REIT FUNDS POISED FOR A COMEBACK

Office space stands out as the drag on REIT performance, while cell towers and data centers ride

BY JEFF BENJAMIN

Financial advisors looking for a steady and stable income allocation inside client portfolios often turn to real estate investment trusts. But, like any investment category, real estate is not one-size-fits-all, and the distinctions can be stark among REIT products.

“We view real estate as an asset class which will frequently have an allocation in most client portfolios,” says Ben Sayer, alternative investments group head and managing director at MAI Capital Management.

However, the challenge is navigating the pockets of opportunity.“Right now, we see value in certain sectors of real estate, but other areas are priced to perfection, requiring high levels of future rent growth, which may or may not come through, to drive returns,” Sayer says.

“When reviewing any real estate opportunity, whether in a public REIT, private REIT, or in a private fund, we always want to understand the sources of potential return, including acquisition cap rate, future rent growth assumptions, underlying lease structures, expense expectations, and exit cap rate assumptions.”

the technology wave

As an investment category that relies heavily on debt financing, real estate returns are directly impacted by the direction of interest rates, which are now more favorable than just a few years ago.

in interest rates,” says Steve Kolano, chief investment officer at Integrated Partners.

“The risk to that opportunity is with potential tariff implementation there may be a leg higher in rates if the impact of tariffs flows through the underlying inflation.”

In terms of the best ways to invest in real estate, Craig Robson, founder and managing director at Regent Peak Wealth Advisors, recommends a diversified allocation to both publicly traded and private REITs.

“Owning real estate within a comprehensive portfolio construct is overall beneficial, but knowing what type of real estate one owns and where they own it is super important,” he says.

Publicly traded REITs are typically packaged as mutual funds or exchange-traded funds and are suited to investors of all levels of net worth. Public REITs trade on exchanges with full liquidity, varying levels of transparency, and live or daily valuations.

Phil Bak, chief executive of Armada ETF Advisors, manages the Residential REIT ETF (HAUS) and de-

“The public market REIT space has been beaten up, but when you talk about real estate assets, the variations are favorable, thanks to a residential supply-demand imbalance”

PHIL BAK, ARMADA ETF ADVISORS

“The opportunity in the space, given the back-up in rates we’ve seen the last few years, is that the worst of the upward movement in rates is behind us, and REITs offer an attractive stream of income going forward, with minimal capital erosion from further increases

scribes himself as “extremely bullish on the sector.”

From Bak’s perspective, public and private REITs often play off each other, and the less liquid private versions can sometimes create performance separations.

“The public market REIT space has been beaten up, but when you talk about real estate assets, the variations are favorable, thanks to a residential supplydemand imbalance,” he says. “Comparing public REITs to private real estate, the valuations are significantly more favorable for public REITs, and our thesis is that those valuations will converge.”

Evan Serton, senior portfolio specialist on the REIT team at Cohen & Steers, also sees brighter skies on the horizon for real estate investing.

“We’re in the midst of a recovery for real estate,” he says, citing the pain of just a few years ago when a series of economic forces, including higher inflation and rising interest rates, were moving against the category.

Cohen & Steers, which manages more than $85 billion firmwide, runs nine REIT mutual funds and one REIT ETF. Its real estate flagship, the Cohen & Steers Realty mutual fund (CSRSX) is up 4.2 percent from the start of the year, which compares to a 1.7 percent decline for the S&P 500 Index over the same period.

“When you look at public REIT valuations versus the S&P, they are trading at discounts to stocks that are sizable relative to history,” Serton says.

The stickier inflation that puts a drag on other areas of the economy is an advantage for real estate investors, he says, “because landlords don’t have a lot of sensitivity to labor costs and commodity prices, but inflation raises the cost of bringing new real estate to market.”

“We’ve long talked about real estate being an effective hedge against rising prices,” Serton adds.

One caveat, however, is the risk of stagflation when a slow-growth economy is saddled with high unemployment and rising prices. “Stagflation is very challenging for listed real estate performance,” Serton says.

On the private REIT side, the risks and opportunities are generally the same, but the reduced levels of liquidity, portfolio transparency, and daily valuations can create a different psychological impact on investors.

“I think there’s always an advantage for the private wealth investor because the general lack of volatility can benefit a typical investor portfolio,” says Brent

Jenkins, managing director and portfolio manager at Clarion Partners, which manages $73 billion worth of private REIT funds.

Clarion, which is majority owned by Franklin Templeton, expanded into the private wealth space about 10 years ago to offer access to wealthy individual investors.

The reduced volatility of private REIT funds Jenkins refers to is simply the result of not being able to track daily the valuations of underlying portfolio holdings, which is the purest way to invest in long-term assets like real estate.

Beyond the reduced liquidity and other private REIT factors, including higher investment minimums, Jenkins sees a road map for real estate that is similar

ly still more room to go in the deeply troubled sectors, such as office space,” he says.“In our view, a prudent entry or re-entry into commercial real estate right now is via newer vintage debt strategies.”

Sayer of MAI Capital Management sees a “bifurcation of opportunities”in the REIT space.“There are those where capital needs are so large that it’s driving an interesting risk-return proposition, and others, which are more contrarian, where the supply of capital has really pulled back,” he says.

“An example of the first would be data centers, but we’re seeing a difference in expected returns between developing new data centers and publicly traded REITs that focus on data centers,” Sayer says. “An example of the second would be office. While we don’t believe office

“In our view, a prudent entry or re-entry into commercial real estate right now is via newer vintage debt strategies”

STEPHEN TUCKWOOD, MODERN WEALTH MANAGEMENT

to what the public fund managers are seeing.

“We’re at the beginnings of a new cycle for real estate,” he says. “Higher rates led to repricing, generally, but as of the beginning of 2024 liquidity started to return to debt markets and that led to the beginnings of a new cycle of healthy supply and demand fundamentals.”

As far as specific real estate sectors go, the consensus is that office space remains an outlier that is still trying to recover from rising vacancy rates during the COVID pandemic.

Stephen Tuckwood, director of investments at Modern Wealth Management, is going slightly against the tide, seeing an opportunity to get in early on commercial real estate.

“There are signs of life appearing in the commercial real estate market, indicating the potential of the market finally beginning to bottom out, although there is like-

is out of the woods just yet, we have seen some market thawing there with a few transactions, and we have seen some interesting transactions with single-tenant headquarters where the tenant is of high credit quality.”

Data centers and cell towers stand out as strong performance subcategories within real estate, but some fund managers warn against chasing performance of REIT funds relying too heavily on those areas.

“Data centers and cell towers have correlations to technology, especially following the AI craze that has pumped up those valuations,” says Bak of Armada ETF Advisors.

Serton of Cohen & Steers agrees that funds loaded with the technology proxies could be souping up performance.

“The property types that predominate in the listed market are cell tower and data center REITs that are both fueled by technology performance,” he says.

Lipper Awards

Fund industry’s top performers crowned

The fund world’s finest came together in style as LSEG Lipper named their top managers and fund families

BY GREGG GREENBERG

Stocks may be slipping on Wall Street, but the world’s finest fund managers still came out in force.

LSEG Lipper announced the winners of the 2025 LSEG Lipper Fund Awards for the United States at a gala in New York’s financial district. These annual awards acknowledge top-performing funds that consistently deliver strong riskadjusted returns compared to their peers. They also celebrate the success of portfolio managers and fund management companies who posted the strongest riskadjusted returns in the industry.

And while the LSEG Lipper Fund Awards are quantitatively based, the award-winners are not determined by merely picking the funds with the highest returns within their US mutual fund classifications. According to LSEG Lipper, the calculation methodology ensures that the winners are funds that have provided superior consistency and risk-adjusted returns compared to a group of similar funds, which is more in line with how investors view financial gains and losses.

LSEG Lipper data covers more than 380,000 share classes in more than 83 countries. The Lipper Leader ratings are available for mutual funds and ETFs registered for sale in 45 markets.

“The number of fund management groups in each category highlights the strong competition for the LSEG Lipper Fund Awards, which honor fund managers who demonstrate excellence in the industry. These awards celebrate the achievements of the asset management industry, recognizing firms that showcase a strategic investment approach and deliver exceptional results,” said Emily Prince, group head of analytics at LSEG.

As for the big winners, Dimensional Fund Advisors LP took the top billing as the best large fund family equity group for the third consecutive year, while Brandes Investment Partners LP, competing against 188 other fund families, took home top prize for the best small fund family equity group.

Over in the fixed-income space, Massachusetts Financial Services was the best bond large asset fund manager, outperforming 23 competitors.

Moving on, Franklin Templeton Investment Management won the trophy for the best mixed-assets large fund manager group, while Saratoga Capital Management LLC took home the hardware for the best mixed-assets small fund family group.

TIAA-CREF Investment Management LLC was named the best overall large fund management group for 2025, while Eaton Vance Management took the top billing for the best overall small fund management group.

“These awards celebrate the achievements of the asset management industry, recognizing firms that showcase a strategic investment approach and deliver exceptional results” EMILY PRINCE, LSEG

Finally, Fidelity Mutual Funds were awarded 32 Lipper Fund Awards. A total of 23 Fidelity mutual funds were recognized by Refinitiv Lipper range across a variety of asset classes and styles, from equities, fixed income, and asset allocation to international, high-income and sector funds.

Bart Grenier, head of asset management at Fidelity Investments, commented on his company’s performance, saying, “This year, our investment professionals continued to deliver strong, long-term, risk-adjusted investment performance for Fidelity’s shareholders. The Lipper Fund Awards reinforce our investment and research teams’ commitment and dedication to enhancing our customers’ financial well-being.”

Night to celebrate: The best in the business came out for the 2025 LSEG Lipper Fund Awards for the United States, top. Emily Prince, above, of LSEG, addresses the audience and, below, the winning Franklin Templeton Investment Management team of, from left: Adrian Chan, portfolio manager, head of quantitative research; Robert Schoen, co-head of investment research; Brett Goldstein, head of asset allocation portfolio management.

Column

10 considerations for advisors preparing for a sale or transition

The nancial advisory industry is experiencing a wave of transitions as it continues to evolve and mature. Whether due to succession planning, consolidation, or regulatory shifts, many rm owners are contemplating their next move. For rms considering a sale, switching broker-dealers, or starting up their own RIA, proper preparation is key to ensuring a smooth transition. If you are an advisory rm owner thinking about making a move, here are the key areas you should focus on to prepare your rm for a successful sale or transition.

1. CLARIFY YOUR GOALS AND OBJECTIVES

Are you looking for a full exit, or do you plan to stay involved in the business post-transaction? Are you seeking greater independence by starting your own RIA, or do you prefer the resources and camaraderie of a larger rm? Understanding your short-term and long-term goals will help guide the process and ensure you choose the right path.

2. GET YOUR FINANCIALS IN ORDER

A rm’s nancial health is one of the most critical factors in any sale or transition. Buyers or potential partners will scrutinize your nancial records, so it’s essential to have wellorganized books.

• Ensure revenue streams are well documented and recurring revenue is clearly de ned.

• Review expenses and eliminate unnecessary costs that could impact valuation, including any personal expenses that you’ve been running through the business. Also make note of any large one-time expenses, such as upgrading your technology, moving into new of ces, or hiring.

• Work with a nancial professional to prepare accurate pro t and loss statements, balance sheets, and cash- ow statements.

• Identify key metrics such as EBITDA

(earnings before interest, taxes, depreciation, and amortization), client retention rates, and growth trends.

3. EVALUATE YOUR CLIENT BASE

The makeup of your client base will have a signi cant impact on valuation and the attractiveness of your rm to potential buyers or partners.

• Client demographics: A younger, growth-oriented client base may be more attractive than one heavily weighted toward retirees.

• Concentration risk: If a small number of clients represent a signi cant portion of your revenue, this could be a red ag for buyers.

• Client engagement: Strong client relationships and high retention rates are positive indicators for prospective buyers.

• Fee structure: Ensure your fee model is competitive and sustainable for future growth, and that your client contracts match your fee schedule and receivables.

4. ASSESS

YOUR TECHNOLOGY AND OPERATIONS

A well-structured technology stack and ef cient operations can increase your rm’s value and ease the transition process. Conduct a thorough review of your tech infrastructure.

• CRM and client management systems: A robust CRM helps demonstrate operational ef ciency and strong client relationships.

• Portfolio management and reporting tools: Ensure you have modern systems that streamline performance tracking and compliance reporting.

• Cybersecurity and data protection: Buyers want to see that your rm adheres to best practices for data security and regulatory compliance.

• Scalability: If you are transitioning to an RIA, consider whether your technology can support future growth.

5. STRENGTHEN YOUR TEAM AND LEADERSHIP STRUCTURE

Buyers and transition partners will look for a strong team that can sustain client relationships and business operations post-transaction.

• Leadership succession: If you plan to exit, ensure a capable leadership team or lead advisor is already in

place to take over.

• Advisor retention: Implement incentives to retain key advisors and staff members through the transition.

• Cultural t: If merging or selling, ensure alignment in culture and values with the acquiring rm.

6. UNDERSTAND YOUR COMPLIANCE AND

LEGAL OBLIGATIONS

Regulatory and compliance requirements are a major factor in any transition.

• Review contracts with clients, vendors, and partners.

• Ensure all documentation and disclosures are up to date.

• Understand the licensing and registration requirements for an RIA transition.

• Identify potential compliance risks that could impact a deal.

7. PREPARE FOR DUE DILIGENCE

To streamline this stage, gather key documents in advance:

• Business nancials (tax returns, audited nancials, P&L statements)

• Client contracts and agreements

• Compliance records and regulatory lings

• Employee agreements and compensation structures

• Detailed business continuity and succession plans

8. ENGAGE THE RIGHT EXPERTS

• M&A advisors or consultants: Experts who specialize in advisory rm transactions can help you structure the deal and maximize valuation.

• Legal counsel: An attorney experienced in nancial services can

ensure contracts and agreements are in your best interest.

• Tax professionals: Understanding the tax implications of a sale or transition is critical to optimizing your nancial outcome.

9. COMMUNICATE WITH CLIENTS AND STAKEHOLDERS

Transparency and a communication plan are key to ensuring a smooth transition for clients and stakeholders:

• Clients: Assure them that their nancial well-being remains the top priority and that services will continue seamlessly. Any transition or move you make should bene t them in the long term as well.

• Employees: Keep your team informed and engaged throughout the process.

• Strategic partners: Vendors, custodians, and referral partners should be made aware of any changes that may impact their relationships with the rm.

10. BE PATIENT AND STAY FLEXIBLE

The sale or transition process can take time – often 12 to 24 months from planning to execution. Whether negotiating deal terms, handling regulatory hurdles, or addressing client concerns, staying adaptable will ensure a smoother transition. It’s also important to remain focused on your goal. Assume the best from your team, your new partners, and your clients … and ask them to do the same.

David Wahlen is vice president of strategic partnerships at Merit Financial Advisors.

OPINION

DAVID WAHLEN

Morningstar Office shutdown a stark reminder

Affected advisors must now decide whether to move to Black Diamond, highlighting the arduous nature of changing portfolio management software

Portfolio management is central to the business of most financial advisory firms, and systems that facilitate the portfolio management process have long been one of the three core parts of advisory firms’ tech stacks (along with CRM and financial planning systems). Given the importance of those tools to an advisory firm’s business, then, it would seem to follow that most advisors would be focused on using the portfolio management software that works best for them. However, the reality of the advisory industry is that inertia often gets in the way of using the “best” tools.

ADVISORTECH BEN HENRY-MORELAND AND MICHAEL KITCES

The most recent Kitces Report on advisor technology found that only around 2.3 percent of advisors planned to change their portfolio management systems within 12 months, even as some systems rated only a 6 or 7 on a 10-point satisfaction scale (particularly low numbers given the overall importance of the software to an advisor’s business). A switch rate that low means the typical advisory firm’s tenure with any particular portfolio management system will often be “the entire career of their advisors with the firm.”

The main reason why advisors tend to be so slow to switch to new software (even if they aren’t all that happy with the software they’re using) is that it can be a real pain to switch from one provider to another. This is especially true in the “all-in-one” portfolio management

category, where the software transition can be especially complex: Reams of historical client data must be ported from the old platform into the new one to ensure accurate historical performance (which, even with modern migration capabilities, doesn’t always replicate historical performance consistently); data connections must be re-established for each client for custodial and heldaway accounts; and custom trading rules and billing structures must be flagged and transferred into the new system.

And so, even though many providers offer support in aiding the transition from the advisor’s existing platform, the

“It’s been clear for some time that Morningstar wasn’t investing the resources into Office that were necessary to keep up with the competition in the portfolio management space”

migration process can still be arduous for advisory firms and their staff. As a result, they often stay with their current technology, even if they are somewhat unhappy with it, until they’re truly forced to make a move – either because the old software simply becomes incompatible with the advisory firm’s needs in continuing to serve their clients or because another event comes along to force the issue.

One of those events occurred with Morningstar’s announcement that it plans to shut down its Morningstar Office

portfolio management platform at the beginning of 2026. Advisors currently on the Morningstar Office platform will need to decide whether to move to Black Diamond – which cut a deal with Morningstar to offer streamlined migration support, discounted platform fees, and continuing access to Morningstar’s investment research capabilities in exchange for a cut of Black Diamond’s revenue from the advisors who move to its platform – or find another solution to switch to in the next 12 months before Morningstar Office is officially sunsetted.

Morningstar’s decision to retire Morningstar Office is somewhat surprising in that it’s rare for a major technology provider to simply shut down a longstanding offering. However, it’s been clear for some time that Morningstar wasn’t investing the resources into Office that were necessary to keep up with the competition in the portfolio management space.

Office’s satisfaction ratings have significantly lagged behind other providers’ in the latest and several prior versions of our Kitces Report: The Technology That Independent Financial Adivsors Actually Use and Like. Also, anecdotal (albeit anonymous) evidence shows that at least some advisors were noticing the low level of investment that Morningstar was putting into its product.

For its part, Morningstar has made several recent moves to refocus on its core business of providing investment data and research tools, including the sale of its TAMP business to AssetMark

and the launch of its new Direct Advisory Suite portfolio analytics tool. So, cutting bait on Morningstar Office was less of an out-of-the-blue decision than a continuation on a theme of getting back to the solutions that Morningstar is best known for.

For advisors on the Office platform, the offer to move to Black Diamond will prove tempting, given that it reportedly includes sweeteners such as a 50 percent discount on Black Diamond’s first-year fee, a waiver of the usual implementation fee for supporting the conversion of client data, and a conversion period where advisors can use both platforms in parallel without paying fees to both platforms.

The caveat, however, is that Black Diamond is reportedly requiring advisors to sign a contract that locks them into the platform for five years in exchange for those incentives. This requirement is perhaps not as big of a downside as it seems given

that once advisors go through the ordeal of switching to a new portfolio management platform, they aren’t likely to want to jump to another one within a few years anyway. However, it still provides Black Diamond with some assurance that it will recoup the cost of the incentives it’s offering (and the share of revenue it’s giving up to Morningstar in exchange for being designated the default “incumbent” platform for Morningstar Office advisors).

But for Morningstar Office advisors who are being forced to make a change either way, it likely makes sense to consider all the portfolio management software options that are on the table, many of which are rolling out their own offers to peel off a share of Office advisors from Black Diamond and other competitors.

Advyzon, for instance, has made a case to be considered the natural successor to Morningstar Office, given that it was founded by the people who originally built Office (and then

left to create the product that they thought Office could have been once it became clear that Morningstar wasn’t investing the resources necessary to improve enough on the product they had). But there are numerous other options as well, from fellow allin-ones – like Orion, Envestnet | Tamarac, CircleBlack, Addepar, Blueleaf, AdvisorEngine, Panoramix, and d1g1t – to portfolio management platforms built as extensions to other advisory services like Altruist (which is free for advisors on Altruist’s custody platform).

Ultimately, while Morningstar Office’s shutdown may prove disruptive for advisors who hadn’t planned on a major technology switch in 2025, hopefully the fact that so many advisors were unhappy with the platform to begin with means that the outcome will prove to be positive in the long term – an impetus for advisors who already weren’t satisfied to make the change that they were reluctant to make due to the now-inevitable switching costs.

“For Morningstar Office advisors who are being forced to make a change either way, it likely makes sense to consider all the portfolio management software options that are on the table”

At the same time, it can serve as a reminder to those same advisors of why it’s worth evaluating the whole portfolio management landscape in order to find the “right” platform to transition to. While incentives and discounts from providers might help to ease the transition to a new platform, it’s likely that most advisors will remain on their next portfolio management platform long after those incentives expire, at which point it will be better to be on the platform that actually works best for serving clients instead of being “stuck” on another one that isn’t up to par.

Ben Henry-Moreland is a senior financial planning nerd at Kitces.com, where he specializes in writing and speaking on financial planning topics including tax, practice management, and technology.

Michael Kitces is the chief financial planning nerd at Kitces.com, dedicated to advancing knowledge in financial planning and helping to make financial advisors better and more successful. In addition, he is the head of planning strategy at Focus Partners Wealth, the co-founder of the XY Planning Network, AdvicePay, New Planner Recruiting, fpPathfinder, and FA BeanCounters, the former practitioner editor of the Journal of Financial Planning, the host of the Financial Advisor Success podcast, and the publisher of the popular financial planning industry blog Nerd’s Eye View

Wells Fargo keeps hiring senior executives for RIA business

WELLS FARGO & CO.’S wealth and investment management group continues to build out its support for registered investment advisors and said it hired Megan Hausmann as a lead recruiter for its RIA Solutions group.

Unlike its wirehouse competitors Merrill Lynch, Morgan Stanley, and UBS, Wells Fargo Advisors and its wealth and investment management group

have broadened the work options for its roughly 12,000 financial advisors at the firm, including making it somewhat easier to move to its independent brokerdealer group, Wells Fargo Advisors Financial Network, known as FiNet.

Hausman until last month worked at Apex Clearing, where she was senior director, advisory services.

UBS to be ‘the biggest loser’ in fight for advisors

UBS IN January admitted that changes made last year to the compensation plan for its roughly 6,000 financial advisors were motivating some advisors in the United States to head for the exit.

Breaking the boys’ club

FINANCE IS a boys’ club. And for Danika Waddell, that reality was obvious from day one.

“The biggest issue for me, certainly at the beginning of my career, has been a lack of mentorship and lack of sponsorship,” she says. “My experience at my very first job in financial services [had a] mentality of sink or swim. I don’t want

my growth and they cared about my progression.”

Instead of hopping ship to another firm and trying her luck, ultimately Waddell decided to build that mecca of encouragement herself and launched her own firm. At Xena Financial Planning, Waddell works with women in tech, a demographic facing the same obstacles

‘My clients are very well compensated, very accomplished – but they’re also very intimidated by the financial world’

DANIKA WADDELL,

XENA

FINANCIAL PLANNING

she did in finance.

And that could turn even uglier this year for UBS, according to a report by one recruiting firm, with the global banking and wealth management firm potentially losing as many as 10 percent – or 600 – financial advisors this year in the United States.

to necessarily speak for all women, but for me, that was not [supportive]. [Instead], I wanted to be in an environment where I was mentored and encouraged.”

THE SIX-YEAR legal battle between Commonwealth Financial Network and the Securities and Exchang e Commission over the firm’s mutual fund  revenue-sharing practices took a sharp turn in Commonwealth’s favor when a fed-

“UBS will be the biggest loser of advisor share in 2025,” according to the report, which was published this week by Diamond Consultants and is titled Financial Advisor Transition Report

eral appeals court reversed a $93 million penalty against the firm.

The day after its rival LPL Financial Holdings said it was buying Commonwealth for $2.7 billion in cash, the US Court of Appeals for the First Circuit in Boston vacated the district court’s grant of summary judgment for the SEC and the disgorgement order, sending the case back to lower court for further proceedings consistent with the appeals court’s opinion.

Happily, Waddell broke free. And when she looked for her next job, she knew exactly what she wanted.

“When I left that role and looked for my next position, I wanted to be in a role where I was being actively mentored – where the company that I was working for was invested in

“Women in tech, much like women in finance, they’re working in a very maledominated space. I often find some of the parallels of what I’ve experienced are very similar to what my clients are dealing with – such as they’re in a room where there are only one or two women. There’s that lack of mentorship.”

The women she works with are successful, highly paid, and still hesitant to take control of their finances.

LPL to buy rival Commonwealth for $2.7B in all-cash deal

LPL FINANCIAL HOLDINGS said it is acquiring Commonwealth Financial Network, a long-standing rival in the wealth management industry.

The price tag? LPL is paying $2.7 billion in cash.

The two former competitors for decades have fought over teams of financial advisors looking for a new place to work, with Commonwealth, a boutique, pitching its technology and service, and LPL,

a behemoth, pitching its size and deep pockets.

The deal has been the chatter of the financial advice industry for the last week, with many Commonwealth advisors in disbelief about no longer working with a boutique.

Commonwealth Financial Network was opened in 1979 by Joseph Deitch, one of the most widely respected senior executives in the independent contractor broker-dealer industry.

“It’s super interesting to me that many of my clients are incredibly successful at what they do. They’re very well compensated, they’re very accomplished – but they’re also very intimidated by the financial world. And so their compensation is often very complex. They feel very confident at work, but then in their financial realm they’ve compartmentalized that –they’ve put it in a box and have absolutely no confidence around that aspect of their

BNY Pershing’s new

cash

sweep

charge to hit RIAs first

BNY PERSHING’S plans to create a new charge on client cash held in accounts of RIAs that custody with Pershing and broker-dealers that use it for clearing are taking shape, with senior industry executives saying the clearing and custody giant is planning to roll out the new charge first to

lives.” The industry has let them down. The narrative that women aren’t good with money is still going strong.

“I think there’s a trend that younger women are deferring finances even more to their partners than, say, baby boomer generations – which is shocking to me.

But I can see that in my clients too. They’re primary breadwinners in many cases but finances are really low on their list of priorities.”

registered investment advisors.

InvestmentNews reported in February that BNY Pershing was evaluating plans to create a new charge, akin to a tax, on cash held by its broker-dealer clients.

BNY Pershing was discussing with broker-dealers that use its platform plans to get first dibs on cash – up to $10,000 – held in their customers’ accounts.

Mercer Advisors, Sequoia announce latest RIA additions

MERCER ADVISORS

and Sequoia Financial Group have both announced new acquisitions, continuing their strategic expansion efforts across the US wealth management landscape.

Denver-based Mercer Advisors said it has acquired two independent firms – Vishria Bird Financial Group in Memphis and D. Scott Neal in Kentucky – adding a combined $883

million in assets under management and expanding its presence in the Southeast.

Meanwhile, Sequoia Financial Group, headquartered in Akron, Ohio, has completed its purchase of Carlson Capital Management, a Minnesota-based advisory firm with $3.8 billion in client assets, marking its ninth acquisition since the beginning of 2023.

Wealth Enhancement,

Alphacore ink new RIA partnerships

TWO NATIONAL RIA firms have announced separate acquisition deals that expand their presence in high-net-worth markets and deepen service offerings for multigenerational families and business owners.

Wealth Enhancement, which manages $107.5 billion in assets, said it will acquire Marcum Wealth, a Cleveland-based RIA overseeing

WPCG, Merit expand with multibilliondollar RIA

WEALTH PARTNERS CAPITAL GROUP and Merit Financial Advisors have made significant steps forward in their inorganic expansion strategies, with new partnerships in Kentucky and Idaho.

Wealth Partners Capital Group and private equity firm HGGC’s Aspire Holdings platform have taken

more than $4.3 billion in client assets.

Meanwhile, AlphaCore Wealth Advisory is merging with Callan Capital, a San Diego-based firm with $2.4 billion in assets under advisement.

Both deals are expected to close in the second quarter of 2025, pending customary closing conditions. Terms of the transactions were not disclosed.

a minority stake in MCF Advisors, a Kentucky-based RIA managing more than $3.3 billion in client assets as of December 31.

The investment is intended to support MCF’s expansion through both organic growth and mergers and acquisitions, according to a statement. MCF’s management team will retain majority ownership and continue to oversee the firm’s operations.

DANIKA WADDELL

FINRA moves to boot Alpine Securities

THE LEGAL ght between Alpine Securities and the Financial Industry Regulatory Authority took one step sidewise when FINRA moved to uphold and nalize its expulsion of the rm, pending a review, from the securities industry, just as Alpine’s dispute of FINRA’s authority to do so continues in federal court.

In 2022, FINRA sanctioned Alpine Securities for violating industry rules and issued a cease-

SEC retreats on crypto

IN A striking reversal of its onceaggressive posture toward the digital asset industry, the Securities and Exchange Commission quietly dismissed three high-pro le enforcement actions against major crypto rms – Kraken, Consensys, and Cumberland DRW – signaling what may be the most signi cant recalibration of US crypto policy in years.

Filed on March 27, the joint stipulations to dismiss these

and-desist order against the rm. After FINRA expelled the rm, Alpine Securities appealed the decision inside FINRA while also suing the rm in federal court.

The decision by FINRA af rms the regulator’s original decision to ban the rm. But it also stays the decision, pending a review by the Securities and Exchange Commission, which oversees FINRA.

‘The spirit of the 10b5-1 is still intact’

EXECUTIVES NAVIGATING wealth management today face complex nancial decisions, from managing concentrated stock positions to addressing behavioral biases and ensuring tax ef ciency.

For Daniel Dusina and Daniel Seder of Blue Chip Partners, utilizing a deepseated understanding of regulatory frameworks paired with an adoption of technology is crucial to successfully diversifying an executive’s portfolio while remaining in line with regulatory restrictions.

but it’s a huge risk to their portfolios,” says Seder, managing partner at Blue Chip. “They’re interested in de-risking their portfolio, but also they want an af rmative defense against any type of insider trading.”

cases “with prejudice” – meaning the claims cannot be refiled – did not stem from any legal concession about the merits of the original allegations. Instead, the SEC pointed to a broader policy shift. The dismissals, according to statements embedded in the court filings, reflect the Commission’s intention “to reform and renew its regulatory approach to the crypto industry.”

Ex-broker ned for plundering clients’ nonpublic information

FINRA HAS penalized an ex-broker with OneAmerica, whom it found transmitted con dential client data from his former rm to personal email accounts and later to a new employer.

Jason Michael Poschinger, who was based in Indiana, has consented to a six-month suspension and a $20,000 ne following a settlement with FINRA announced March 27.

He neither admitted nor denied the ndings but agreed to the sanctions and the entry of ndings for the purpose of resolving the proceeding.

Between September and November 2021, while registered with OneAmerica Securities, Poschinger transferred non-public personal customer information from rm systems to personal email accounts he controlled, FINRA said.

Amendments three years ago to the SEC’s 10b5-1 plans, which added disclosure requirements and enhanced investor protections against insider trading, have not signi cantly altered Blue Chip Partners’ approach to equity-based compensation. Seder emphasizes the importance of ensuring diversi cation in executives’ portfolios, which can often prove challenging.

“Our clients are … interested in derisking a highly concentrated position. It’s an enviable dilemma that they have, having a lot of money in one stock,

Judge dismisses investor suit against Barclays

A FEDERAL judge has dismissed a proposed class action accusing Barclays PLC and its banking unit of violating federal securities laws through the sale of billions of dollars in unregistered structured products, including its volatility-linked exchange-traded notes.

The lawsuit, brought by a group of individual investors, alleged that

‘It’s an enviable dilemma that they have, having a lot of money in one stock, but it’s a huge risk to their portfolios’

DANIEL SEDER, BLUE CHIP PARTNERS

Because executives are often privy to material non-public information, they face stringent blackout periods that limit their trading windows. Seder says he takes full advantage of open windows to plan.

Barclays failed to track securities sales after losing its “Well-Known Seasoned Issuer” (WKSI) status, resulting in the sale of unregistered VXX exchange-traded notes (ETNs). But in a comprehensive opinion, US District Judge Lewis J. Liman ruled that the plaintiffs lacked standing and failed to show that the bank made any actionable misstatements or omissions.

“We use 10b5-1 plans to combat that. In an open window, they’re eligible to identify price targets, identify share blocks that they want to liquidate, or certain types of grants that they want to exercise or execute upon, and then the plan will take care of itself,” adds Seder.

Executives often struggle with the psychological biases that come with signi cant wealth accumulation.

“As our wealth over the years has grown markedly due to market increases or the performance in the stock market, we’re wealthier as a society,” Seder says. “When their company is doing well and they’re becoming wealthier and wealthier, they often let that ride, and that con icts with the concept of diversi cation and risk management.”

Additionally, the endowment effect –where individuals place a higher value on what they own – can cause executives to overestimate the worth of their company stock.

“That also is a very, very strong behavioral bias that would impact corporate executives, and one that we address not only in our nancial planning and modelling but also in establishing 10b5-1 plans,” says Dusina, chief

WHAT IS THE 10B5-1 RULE?

The rule is an SEC regulation that allows insiders of public companies to set up a trading plan for selling stocks they own. It permits major holders to sell a predetermined number of shares at a predetermined time. Many corporate executives use 10b5-1 plans to avoid accusations of insider trading.

Source: Investopedia

investment of cer at Blue Chip.

The evolution of tax-ef cient wealth management has been accelerated by technological advancements, providing rms with powerful tools for portfolio optimization.

“We are so spoiled today, just given the advancements of technology platforms, the availability of different types of products,” adds Dusina. “It’s unbelievable the tools and resources that we have at our disposal now.”

Trump SEC pick grilled by Democrats

PAUL ATKINS , President Donald Trump’s pick to lead the Securities and Exchange Commission, faced an early political test over his strong ties to Wall Street and digital-asset rms.

At his nomination hearing, the former Republican SEC commissioner and founder of consulting rm Patomak Global Partners, met with stiff opposition from Democratic lawmakers over his potential con icts of interest and support of deregulation.

Senator Elizabeth Warren, speaking just before his Banking Committee hearing, said she’s concerned that

Atkins is “thinking about his past and future clients” rather than American families. That criticism is unlikely to get in the way of his approval by the GOP-controlled Senate.

FINRA hits RIA buyer NewEdge with $1M penalty

FOR THE second time in a year, NewEdge Securities, the broker-dealer arm of aggregator NewEdge Capital Group, was penalized by the Financial Industry Regulatory Authority due to its mishandling of bond trades, and the rm was penalized more than $1 million for misreporting purchases of new municipal bonds.

The settlement follows a $144,000 FINRA penalty NewEdge Securities

agreed to last March, according to the rm’s BrokerCheck pro le. That came after FINRA alleged that NewEdge charged unfair prices in corporate and municipal bond transactions.

NewEdge Capital Group is a fast-growing aggregator of wealth management rms and teams that nished last year with $65 billion in client assets.

Judge accused of bias by ex-life insurance employee

A FEDERAL judge declined to step down from a long-running employment discrimination case against Denver’s Jackson National Life Insurance Company, rejecting arguments from a former employee who alleged judicial bias.

Chief Judge Philip A. Brimmer of the US District Court for the District of Colorado denied a motion led by La’Tonya Ford, a

former Jackson National employee and intervenor plaintiff, who had sought his recusal along with that of Magistrate Judge Timothy P. O’Hara. Ford, who is representing herself, claimed that both judges demonstrated partiality against her in the case, which was initiated by the Equal Employment Opportunity Commission (EEOC) in 2016.

Cambridge hit with $15M penalty

CAMBRIDGE INVESTMENT

RESEARCH ADVISORS has agreed to pay $15 million to resolve allegations by the SEC that it failed to disclose multiple con icts of interest in how it recommended investments to clients.

According to the SEC, CIRA breached its duciary duty over more than a decade by steering assets into certain mutual funds and sweep accounts that generated revenue for an

af liated broker-dealer, Cambridge Investment Research, rather than opting for lower-cost alternatives.

The penalty stems from a March 2022 complaint, which also alleged the Cambridge RIA moved clients into higher-cost wrap accounts without adequate disclosures or analysis of whether those accounts were in their best interest.

DANIEL SEDER

Bisignano pledges to protect Social Security

IN A Senate confirmation hearing marked by partisan tensions and sharp questions about the future of Social Security, nominee Frank Bisignano firmly stated he has no intention of steering the agency toward privatization – a concern that has gained traction amid broader fears of cost-cutting initiatives under the Trump administration.

“I’ve never thought about privat-

izing,” Bisignano said, offering what he called a “guarantee” that Social Security would remain a public program under his leadership. The Wall Street executive, tapped by President Trump to head the Social Security Administration (SSA), emphasized that his focus would be on modernizing operations and reducing inefficiencies – not altering the fundamental structure of the program.

Social Security Administration sets record straight

THE SOCIAL SECURITY ADMINISTRATION has pushed back against claims that it is issuing benefits to millions of deceased individuals, stating that reporting errors represent only a small fraction of overall records.

Steering investors away from high-risk moves

FOR MITCHELL TUCHMAN, countering the allure of risky and high-fee mutual funds from investors is a never-ending challenge.

But Tuchman’s deep faith in low-cost index investing allows him to rein in clients’ urges to outguess the market, particularly in a moment of elevated market uncertainty.

“There’s no evidence that a smart stock picker running a mutual fund will be able to outperform the benchmark consistently over many years,” says Tuchman, managing director and CIO of Rebalance 360. “The fees are too high, and also the markets have become super-efficient.”

mutual funds on Wall Street,” he says. “That could not be more true today.”

For decades, advisors built their careers on stock picking and market timing. Tuchman suggests the industry has evolved, forcing advisors like himself to lean into the interpersonal skills that provide clear guidance for investors.

“The skills required to become a CFA are not important in the current world of a financial advisor,” Tuchman says. “You have to build and manage portfolios that basically capture the market returns.”

As clients inevitably panic over volatile market trends, Tuchman says the ability to demonstrate a clear strategy to counter uncertainty is where his value as an advisor is proven.

Most

AS RETIREMENT draws near for millions of Americans, concerns over outliving their assets are emerging as a top financial priority, according to new findings from Global Atlantic’s March 2025 Retirement Outlook Survey

“Of these millions of death reports received each year, less than one-third of 1 percent are erroneously reported deaths that need to be corrected,” the agency said.

In a statement, the agency said it receives more than three million death reports each year and maintains a high level of accuracy in its records. According to the agency, incorrect death reports account for a negligible minority of all cases.

The study, based on responses from more than 1,000 individuals between the ages of 55 and 75 with $250,000 to $2 million in investible assets – putting them within the massaffluent and high-net-worth bands of the wealth spectrum – found that twothirds of investors are worried their retirement income may not last their lifetime. Among them, three in 10 say they are extremely or very concerned.

More broadly, the desire for stability is shaping retirement strategies. Nearly nine in 10 investors in the survey said having investments that generate a steady stream of income is important.

He points to A Random Walk Down Wall Street author Burton Malkiel, who worked alongside Vanguard’s Jack Bogle to pioneer index investing, suggesting Bogle and Malkiel’s thesis still holds, particularly within the current market outlook.

“Burt figured out in the mid-70s that if there was such a thing called an index fund, it would do better than all of the

Financial pros agree annuities make client

relationships

AS ANNUITY sales continue to climb across the industry, new research suggests financial professionals are finding an added benefit in the products beyond

“I literally got an email on Saturday morning from a client who wants to go to cash because she’s worried about the announced tariffs that Trump had just put together,” he says. “She cannot imagine a world that’s going to be sane in the next few years, in her opinion. So she

income guarantees and downside protection: stronger client relationships.

According to a recent Nationwide survey of 504 financial professionals conducted with Zeldis Research, nearly three in four respondents who sell annuities said the products help them retain clients. Among higher-volume sellers –those who completed 10 or more annuity transactions over the past two years – that figure rose to 81 percent.

The survey, conducted online in September 2024, included advisors across the broker-dealer, wirehouse, and RIA channels.

MITCHELL TUCHMAN

“There’s no evidence that a smart stock picker running a mutual fund will be able to outperform the benchmark consistently over many years”

MITCHELL TUCHMAN, REBALANCE 360

wants out. And my job is to talk her out of doing that.”

Tuchman views novel and flashy trends such as equal-weighted indexing with extreme skepticism.

“The S&P 500 divided by 500 in equal weight? Well, you wouldn’t have caught Nvidia with that,” he says. “You just don’t catch certain things.”

Stress-testing potential market scenarios is another key aspect of

Social Security services at risk from

THE SOCIAL SECURITY ADMINISTRATION is eliminating phone-based service for changing directdeposit account information, directing beneficiaries to make those updates online or in person at a field office as of March 29. The agency says the change is aimed

Tuchman’s strategy, and allows him to demonstrate to clients the potential risks of straying too far from low-cost indexing.

“We believe we have a great process with market cap-weighted global index portfolios that have very low fees,” he says. “In the financial planning process, we do the Monte Carlo simulations, and we stress-test portfolios against all kinds of market conditions.”

`at reducing fraud, but critics argue it will create additional hardships for retirees and people with disabilities.

In a statement, the SSA said the decision was based on an internal review of security vulnerabilities. “Approximately 40 percent of Social Security directdeposit fraud is associated with someone calling SSA to change directdeposit bank information. SSA’s current protocol of simply asking identifying questions by telephone is no longer enough to prevent fraud,” the agency said.

Limra projects strong annuity sales through 2027

IN ITS latest retail annuity sales report, featuring finalized data from 2024, Limra said sales grew 12 percent in the year to hit a

record $432.6 billion, just slightly off from the preliminary count of $432.4 billion it released in January.

Fourth-quarter sales were $100.6 billion, up slightly from the previously reported $100.4 billion. Registered indexlinked annuity (RILA) sales were also revised upward, totaling $65.4 billion for the year, a 38 percent increase from 2023.

As total quarterly annuity sales breached the $100-billion mark in all four quarters of 2024 – a historic first – the industry notched its third straight year of record annuity sales, with annuities raking in $1.1 trillion over the past three years.

Many advisors lack estate plans themselves

LIFE AFTER death is an uncomfortable topic for everyone, including the advisors often tasked with supporting their clients’ estate planning.

“We work with tens of thousands of advisors, and the most obvious thing is that most advisors still don’t have an estate plan themselves,” said Cody Barbo, CEO of digital estate planning firm Trust & Will. “So, when they have a gap in their own

estate planning, it’s harder for them – they often avoid the client-facing conversations around this.”

Data from Trust & Will shows that one in four financial advisors lack their own estate plan. Trust & Will’s 2025 Financial Advisor Report found that 70 percent of consumers now expect estate planning to be included in their financial plan, showcasing an evolving “do as I say, not as I do” dynamic.

Gaps in retirement savers’ knowledge

A NEW white paper from T. Rowe Price highlights significant gaps in Americans’ understanding of Social Security benefits, with younger generations also expressing deep skepticism about the program’s future.

The findings, drawn from the firm’s 2024 Retirement Savings and Spending Study, are based on responses from 401(k) participants across different age groups.

Among those aged 50 and older, a vast majority (92 percent) were aware that claiming benefits before full retirement age leads to a

reduced payout. However, just over three-fifths (62 percent) knew that delaying benefits beyond that age results in higher payments. In addition, just 45 percent of these preretirees said they were aware of their approximate Social Security benefit amount.

YourPractice

What’s keeping RIAs up at night?

WHILE MARKET volatility concerns RIAs, regulatory changes and operational challenges weigh just as heavily. “You have state-level privacy laws, whether that’s new privacy laws in California, like the CPRA [California Privacy Rights Act] or the Virginia Consumer Data Protection Act or the Colorado Privacy Act,”said Mike Watson, SVP and head of RIA custody at Axos Advisor Services.

Fintech firms expand via Cetera, Mesirow

FINTECH FIRMS Wealth.com and 401GO formed strategic partnerships to help advisors meet growing client demands in estate and retirement planning. Wealth.com is teaming up with Cetera Financial Group,

“Those laws require advisors to implement really robust data protection measures and provide transparency about how they’re collecting data and the usage.” For Watson, AI and data analytics are becoming table stakes for RIAs, particularly as they face a growing need to connect with younger generations and clear a higher bar of client expectations.

giving 12,000 advisors access to its estate planning software –amid the projected $124 trillion intergenerational wealth transfer.

“Financial advisors today are expected to provide more comprehensive guidance than ever before, and estate planning is a critical component of that responsibility,” said Tim White, chief growth officer of Wealth.com. Meanwhile, 401GO has partnered with Mesirow, which will act as a 3(38) fiduciary for retirement plans administered through 401GO, which partners with more than 1,400 financial advisors.

Snappy Kraken inks Catchlight data deal

SNAPPY KRAKEN, an industryleading wealth technology firm that helps advisors create automated marketing campaigns and personalized websites, has partnered with Catchlight to offer financial advisors new tools for personalized marketing.

Both companies also announced the completion of their SOC 2 type 2 certification, a key benchmark for data security and compliance. Catchlight, an AI-based platform focused on organic growth for advisors, analyzes up to 2,000 data points per lead – including estimated investible assets, income, home value, and a proprietary “Catchlight Score,” which predicts a prospect’s likelihood to become a client. The integration lets advisors view insights such as income projections, investible assets, and potential revenue.

Inflation concern exaggerated, says market strategist

WHILE MANY investors prepare for potential inflationary pressures, Clark Geranen does not hold the same outlook concerns, maintaining faith in his long-term portfolio strategies.

With a lack of rate cuts and inflation staying steady at three percent, Geranen suggests inflation’s influence on markets will be subdued compared to current speculation.

“Last year, we actually saw more of an impact on investors’ approach because of the rate cuts and because of where inflation was heading,” says Geranen, chief market strategist & chief operating officer at CalBay Investments. “Because we’re not going to see any more rate cuts this year, we really don’t see inflation as being a huge phase effect on where people are investing.”

The bigger shift is happening elsewhere – out of large-cap tech and into a broader market mix, according to Geranen.

“We saw 20-plus percent returns in those mega-cap, Magnificent Seven companies,” Geranen says. “It came as no surprise to see some of those

Fiduciary trust

THE 2025 edition of The Cerulli Report –US Retail Investor Solutions found that seven in 10 affluent investors expressed confidence that their primary provider was obligated to always act as a fiduciary. That perception appeared to influence client satisfaction directly, as 70 percent

funds flowing from the large-cap growth names in the Mag Seven and diversifying.”

However, US President Donald Trump’s widespread use of tariffs has created a great deal of market uncertainty among advisors and investors, something Geranen hopes will cool in the coming months.

“I think that also has a lot to do with where we go with Trump 2.0 tariffs, and I think that’s really where there’s so much uncertainty right now,” he says. “We’re hoping that that becomes more negotiations, as opposed to these hardline retaliatory tariffs.”

From an allocation standpoint, Geranen remains bearish on international stocks, pointing to potential risks in the future.

“In general, we only allocate less than 10 percent to international, so from an impact to clients’ accounts, we typically just aren’t taking that risk in the international stocks,” he says.

Some sectors are more at risk than others amid today’s trade conflict. Consumer discretionary and

of those affluent investors were satisfied with their advisor relationship and were not seeking alternatives. By contrast, only 41 percent of investors who thought their provider might prioritize the interests of their firm reported a comparable level of satisfaction. Most affluent investors surveyed still want access to human advisors, including 85 percent of households with over $5 million in assets.

Active ETFs could attract younger clients

NEW CAPITAL GROUP research suggests active ETFs may help advisors win over younger investors. Nearly half of Gen Z, millennial, and Gen X respondents said they’d prefer working with advisors who offer active ETFs. Younger clients emphasized diversification and return potential over low fees.

The study pointed to a disconnect between investor preferences and advisor assumptions. While many financial professionals cited the limited track record of active ETFs as a barrier, this concern did not cross over as younger investors with $100,000 to $1 million in investible assets reported both awareness and a growing appetite for the strategy.

Fidelity’s eMoney enhances planning tool

“Because we’re not going to see any more rate cuts this year, we really don’t see inflation as being a huge phase effect on where people are investing”

CLARK J. GERANEN, CALBAY INVESTMENTS

manufacturing would take the hardest hit if full-force tariffs were to extend into the coming months, according to Geranen.

“Financials have the tailwinds of deregulation and tax cuts, which has already proven fruitful for them in their earnings,” he says. “Earnings in quarter four were 50 percent year over year.”

There are also signs that manufacturing is turning a corner, according to Geranen.

Americans seek ethics, clarity from advisors

WHILE AMERICANS value financial advisors who can clearly explain complex concepts, that’s not all they’re looking for, according to a national study released by TIAA and the MIT AgeLab. The study drew responses from more than 1,000 survey

ED KURESMAN

“We got the most recent Purchasing Managers Index numbers out last month. It was the first time that it was above the 50 threshold,” he says. “So now we’re in that upward trend of bullish sentiment.”

Beyond tariffs, Geranen is looking at financials and tech as particularly attractive options.

“I think [financials and tech] could be two of the greatest benefactors,” Geranen says.

respondents across the US, as well as in-depth interviews from selected professionals.

The top three traits respondents said they want in an advisor are the ability to explain things clearly (rated “very important” – 3.64 on a four-point scale), domain expertise (3.64), and ethical standards (3.56). Reputation and years of experience followed closely behind. The report also found that 62 percent of respondents want their advisor to act primarily as an information source.

THE FIDELITY-OWNED fintech eMoney Advisor has revamped its Needs Analysis feature, a streamlined tool aimed at helping financial advisors engage massmarket and mass-affluent clients. The update enables real-time outputs and summary reports on retirement, education, and spending goals.

“Many people are interested in receiving financial advice but

Black Mammoth CEO: DEI rollbacks threaten progress

STOY HALL , CEO of Black Mammoth, is sounding the alarm on political backlash against DEI efforts, warning that it could undo decades of progress. “To have something come down like, ‘Hey, we’re getting rid of everything and starting back over,’

only want to discuss goals that are most relevant to them,” said Chad Porche, eMoney’s SVP of product management. New planning modules, starting with life insurance, are expected throughout the year. eMoney leads the financial planning software space with a 28.2 percent market share, particularly popular among highrevenue advisory firms.

really sets us back 50, 60, 100 years,” said Hall.

Despite comprising roughly 13.6 percent of the US population, Black professionals hold just 8 percent of financial services jobs. Hall sees grassroots organizing to centralize efforts as the way forward. “If someone would take that or a group would take that initiative to allow others to jump on board with it, you’d see the needle move in a quick fashion,” he said.

CLARK J. GERANEN

Investing

Is this the end of the Magni cent 7?

THE FIRST quarter of 2025 has been anything but magni cent for the market’s so-called  Magni cent 7. The septet of stocks that propelled the S&P 500 to record heights –Apple, Microsoft, Google parent Alphabet, Amazon.com, Nvidia, Meta Platforms, and Tesla – has taken a similar leadership role in bringing the benchmark index back down to earth.

The S&P 500 shed over 4 percent in the rst quarter of 2025. Meanwhile, the Roundhill Magni cent Seven ETF (MAGS), which offers equal-weight exposure to the Mag 7, was down 15 percent over the same period. In 2024, the MAGS ETF was up a heady 64 percent, more than double the S&P 500 return of 25 percent for the year.

Which worries advisors more – in ation or employment?

THE FED’S favorite in ation rate, the core personal consumption expenditures (PCE) price index, rose more than expected in February, according to the Commerce Department. The core PCE price index, which strips out volatile food and energy prices, rose 0.4 percent, above Wall Street’s 0.3 percent forecast. The 12-month core in ation rate ticked up to 2.8 percent from the previously reported level of 2.6 percent in January,

above the consensus estimate of 2.7 percent.

Meanwhile, on the other side of Fed Chairman Jerome Powell’s ledger, the US economy rose 2.4 percent in the nal three months of 2024, decelerating from a 3.1 percent pace in the third quarter, according to the government. Gross domestic product (GDP) for the full year, 2024, grew 2.8 percent, down slightly from 2.9 percent in 2023.

Return of capital beats return on capital

AS MARKET uncertainty persists amid rising interest rates, in ation, and economic volatility, investors are seeking strategies to protect and grow their wealth. Tackling these challenges head-on is essential for Richard Saperstein, managing director, principal, and chief investment of cer at Treasury Partners.

“The biggest issues are more speci c to the stock market,” Saperstein says. “In particular, we’ve had a long-standing overweight in US versus non-US developed markets, along with an overweight to largecap technology stocks.”

Despite concerns over technology valuations, Saperstein sees strong growth potential.

“Yes, we do think tech is overvalued, yet we continue to stay with it because that’s where the largest growth is in the S&P 500,” he says.

And with two consecutive strong years in equities, rebalancing allocation is a priority for Saperstein, who emphasizes the importance of return of capital to investors.

“We constantly review client asset

Is

your

wealth

manager still ‘buying the dip’?

DESPITE ALL the uncertainty since the start of 2025, net in ows into US stocks and ETFs from retail investors have remained strong. This suggests that the dip-buying mentality remains robust among everyday investors. Retail investor fund ows are $67 billion so far in 2025, barely down

allocations, and we’ve had two very strong years in the stock market, so some clients are now overweight equities,” Saperstein adds. “What we typically do in that case is to rebalance the portfolios, because for most of our clients, the return of capital is more important than the return on capital.”

In a volatile economic environment, liquidity management is critical to Saperstein. This year, with the new administration, he believes it will be very episodic and have a choppy impact on both the debt and equity markets.

“Coupled with the fact that credit spreads are very tight, we’re not taking a lot of credit bets, but we’re managing duration right now,” he says. “We’re being very selective when we extend maturities for all of our clients, both our corporate cash clients as well as our private clients.”

Several structural shifts are in uencing investment strategies. According to Saperstein, there seems to be a very large push in the investment industry to utilize alternative investments, but Saperstein and his team at Treasury Partners are minimizing their use of alternatives.

from $71 billion in Q4 2024, according to VandaTrack and highlighted by the Financial Times.  Meanwhile, even as mom and pops have been buying stocks through each selloff this year, hedge funds, or the so-called smart money, have been selling into the storms.

“Through yesterday, our best guess is that we are currently in the middle innings of this (de-risking) episode,” said Goldman Sachs vice president Vincent Lin in a note.

‘We do think tech is overvalued, yet we continue to stay with it because that’s where the largest growth is in the S&P 500’

RICHARD SAPERSTEIN, TREASURY PARTNERS

“I think investors should think about what the actual after-tax return on alternatives is, on a liquidity-adjusted basis,” he says. “We believe there is superior opportunity in the municipal bond market, which offers liquidity and, currently, the opportunity to earn a 4 percent tax-free yield.”

Another major shift is the growing use of exchange-traded funds (ETFs) and

Advisors face dollar dilemma

THE US Dollar Index, best known as the DXY, is down about 4 percent year to date, hanging onto the 104 level. The index was closer to 90 a scant four years ago, before the Federal Reserve started its streak of rate hikes, which attracted dollar buyers worldwide, strengthening the greenback against rival currencies. Most noticeably, it was three years ago this May when the DXY eclipsed that allimportant 104 level for the rst time in more than 20 years.

indexing, according to Saperstein.

“The increased use of ETFs and indexing for many asset classes is proving to be the most ef cient and effective manner to get exposure to certain asset classes,” Saperstein says. “Primarily, we’re seeing that in the large-cap space, and we believe investors should consider a combination of active and passive ETFs in their portfolio.”

Sean Beznicki, director of investments at VLP Financial Advisors, said: “While the dollar has depreciated due to rate-cut expectations, in ation, and global dedollarization efforts, we believe it may strengthen in the near term given ongoing safe-haven demand, potential Fed policy shifts, and geopolitical uncertainties.”

Should advisors let their clients pick longshots?

WHEN IT comes to speculation, Ray Baraldi, senior nancial advisor at 2/13 Strategic Partners, believes the client needs to have a desire and appetite for it. He pointed out that true speculative

investments can go to zero, which is not easy for most people to stomach. For that reason alone, he does not believe that speculative investments should be a requirement in all client portfolios.

For those clients that do want to bet on a yer or two, Baraldi typically suggests around a 2 percent portfolio allocation.

“A very aggressive client may try to push that allocation to 5 percent, but we would be getting uncomfortable beyond that percentage,” Baraldi said.

Compliance of cers feel the pain

THERE IS no doubt the market’s recent volatility is keeping a lot of Wall Street’s salespeople, traders, and investment managers very, very busy.

But compliance of cers innancial advisory of ces may have a lot to complain about too because they are busier than ever keeping up with changing regulations.

Andrew Butte, senior vice president of Compliance at Dynasty Financial Partners, for

one, said one of the new rules he is paying close attention to is the new anti-money-laundering (AML) requirement that registered investment advisors will have to adopt. Currently, this new AML is not effective until the beginning of 2026; however, depending upon how expansive an RIA’s AML policies and procedures must be, it can take several months to create, set up, and incorporate.

RICHARD SAPERSTEIN

Advisors name their favorite AI programs

IT’S GETTING rarer and rarer to sit through a meeting with wealth managers without somebody chatting about AI and all its potential uses.

A new study shows it’s not all talk. Financial advisors are using AI more and more – and they have no plan to stop anytime soon.

The recently released 2025 T3/Inside Information Software Survey found that 41 percent of advisors are using one or more search or generative AI tools. The tools with the

largest market share include ChatGPT (35.71 percent), Microsoft Copilot (12.12 percent), and Google Gemini (6.86 percent), while those with the highest advisor ratings are Perplexity (8.26/10), Anthropic (8.10/10), and ChatGPT (8.07/10).

The 2,128 survey participants, exclusively members of the financial planning and investment advisory community, provided answers to questions about 45 fintech categories focusing on AI.

Is core PCE a core price gauge?

THE CORE personal consumption expenditures price index for January rose 0.3 percent from December, according to the Bureau of Economic Analysis, which was in line with Wall Street estimates. The core PCE provides a measure of the prices paid by Americans for domestic purchases of goods and services, excluding the prices of food and energy. It increased 2.6 percent from a year ago, matching the smallest

annual increase since early 2021. Will Sterling, CIO and partner at TritonPoint Wealth, considers it a best practice to watch the data that the Fed acknowledges is an input in their decision making. Still, he said, he spends a great deal of time looking at the component constituents of the core PCE, their relative contributions, as well as looking through adjustments that may be needed.

Market’s meltdown not hurting hiring

HAS THE employment outlook changed at all since the market’s March reversal? Wall Street job hoppers – and seekers – need to know.

John Lane, co-founder and partner at financial recruiter Landing Point, for one, said that news cycles and periods of volatility “don’t drive the hiring market as much as people think.” Right

now, he said, the hedge funds, private equity funds, and other financial clients he deals with every day remain confident and bullish in their own internal growth forecasts. As a result, he has not changed his outlook either. In the first two months of the year, he says his placement efforts are up about 20 percent.

Are value stocks finally taking the baton?

IT’S STILL too early to say whether this latest shift toward value is a lasting trend or just temporary, according to Adam Reinert, chief investment officer & chief operating officer at Marshall Financial. In his view, growth-focused stocks are weighing on equities at this point, particularly compared to more value-oriented names.

“Nvidia, for example, has been one

of the ultimate growth darlings over the past few years, trading at a multiple around 50 times forward earnings recently,” Reinert said. “Now, that’s come down to about 24 times future earnings. So, I can’t help but wonder: do dip buyers step back in at some point, especially with multiples having been sharply cut for some equities over the past few weeks?”

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