Independent Broker-Dealer- Your Guide in Choosing the Right Firm
Independent broker-dealer firms are usually owned by publicly traded companies, large shareholders, private equity firms, and diversified financial companies. If you make a research online, you will actually find out that there are several independent broker-dealer firms today. However, you must understand that each of them has their own strengths and weaknesses. As you try to search for the best one, take note that only the one that suits best your needs is right for you.
It can be very overwhelming and confusing to know that you have plenty of choices. However, this article lists down the most important points you need to put into careful consideration before you finally make a decision.
1. Consider the experience of the firm. The very first thing to look for is how stable the firm is in providing their services. The experiences of the firms vary from one to another. That is why, it makes sense to choose someone who is considered to be established and experienced player in the field. Take note that each adviser has his own way of making business, most of them rely on certain technologies, products, and other services which may meet the clients’ needs. A good firm is the one who has been operating the business for five years or more.
2. The representation of the advisers on the board. Another essential consideration is the representation of the adviser on the broker-dealer’s board. This is very important as this help set goals, offer strategies direction, and provide input on essential decisions. It is very important to take note that an adviser who takes everything in his hands may not be good. Although handling clients independently can be truly rewarding, this can also consume a lot of time. However, you will feel more secured when you have a board that is composed of several reliable advisers. A team that works together for your good is truly a blessing.
3. The accessibility of the CEO and senior leadership team. Since there is no private equity partners or public company shareholders, they are to help the specific needs of the company, referring to the advisors’ needs. This would simply mean that they have plenty of time to attend to the concerns of the advisors. With their guide, you less likely worry about mistakes to be undertaken. So, be sure to ask if the senior leadership team and broker-dealer CEO is available at all times to help and support their advisers.
4. The financial strength of the firm. Aside from the accessibility of the entire team, you should also look into how strong the firm’s finances is. In any business, no matter how big or small, it requires enough capital in order to achieve its goal. Although you might have read articles that says only the big firms can survive, there are also smaller firms who never stopped thriving for their mission. So, do not only base on the size but look into its financial strength.
Now, these things will sure help you find the right firm for you.