Lure of the boutique examined in mid-February’s Advisor’s Edge

(February 13, 2004) There’s a certain mystique about breaking free from restraints, choosing your own path and heading out on the open road.

Coming on the heels of an era where “bigger is better” was the business mantra, many top advisors are deciding to break away from their bank-based practice and charting a course with their own boutique firm.

“Consolidation is still a hot issue in financial planning circles, but stockbrokers seem poised to follow the opposite path,” says Scot Blythe, investments editor for Advisor’s Edge. “Most of the independent dealers were bought up by the banks throughout the 1990s. Now independents are making a comeback.”

In his cover story for the February issue of Advisor’s Edge, Blythe examines this trend as big-book investment advisors take a more personal approach with their clients.

“They’re finding the banks apply a cookie-cutter approach to client service and products,” says Blythe. “Also, the banks are just too ponderous. Some top-end brokers are looking to regain the personal touch in a smaller, highly focused firm. It’s about control, but it’s about culture, too.”

Also in the February issue, Advisor’s Edge wraps up its RRSP Survival Guide with its fourth installment, titled “Open Dialogue.”

“It’s focused on the fact that the RRSP is only one part of the investment puzzle,” says Deanne Gage, managing editor of Advisor’s Edge. “RRSP season is a chance to revisit the entire portfolio — other assets a client may have in non-registered accounts. It’s an opportunity to bring new assets on board, maybe investments they haven’t considered before, such as segregated funds.”

The article entitled “Guaranteed Contracts” examines seg funds and whether they might be a suitable product for clients who have decided the roller coaster of the equities markets is not for them.

“They just want something safe, something that’s going to give them a guarantee — they don’t mind paying higher management expense ratios for that product but they can sleep at night,” says Gage.

There’s also an article on whether certain investments should be held within an RSP or a non-registered account, based on differing scenarios.

“Hot Property” is an article by Geoff Kirbyson, which examines the movement of investors into the real estate market. Is it just the next bubble, waiting to burst? the author asks.

“Clearly real estate is booming right now, and maybe those people who may have been turned off of the stock market or traditional mutual fund investing might be enticed into investing in real estate and real estate investment trusts (REITs),” says Gage. “This article does a good job of explaining the nuances of REITS, what kind of client should be considering them and also their pitfalls.”

Filed by Steven Lamb, Advisor.ca, steven.lamb@advisor.rogers.com