Bunch of Questions

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Mar 18, 2009 10:10 pm

I'm thinking about going independent real soon, moving from a broker/dealer.  I want to have the investment choices of any broker dealer and would also like to do financial planning.   I personally have all of the licenses but not sure what I need to do or how to register my company.

 
Any suggestions on stock commissions?  I would like to be cheap and use it as a tool to gather assets and do managed money
Bond trade commissions?
Any suggestions on top 3 clearing platforms and or independents like LPL etc.?
Software on stock quotes and technical indicators?
Reporting software for both plans and asset allocation/diversification?
 
Thanks for any help.
 
Mar 18, 2009 11:29 pm

Wow.  You're asking a multitude of questions that really shouldn't be answered in one thread.

The first thing to do is determine what broker/dealer you might want to align yourself with.  Check out their platforms, services, product lineup, commission structures.  In other words, what platform will suit your current business or be right for the business you'd like to build.

In many independent's opinions, you'll find that Raymond James and LPL are probably the two biggest indy platforms out there.  I would suggest you contact the local recruiters from both firms and discuss your business with them.  They will provide you with all of the answers you need regarding commissions, managed money, financial planning software, etc.

Mar 19, 2009 8:06 am

etj, thanks for the info.  Any range on payouts from RJ and LPL?

Mar 19, 2009 9:35 am

RJ's platform pays out 85% on transactional business (stock and bond trades) and 90% on fee-based business like mutual funds, annuities and wrap business.

 
LPL pays 76.2% on transactional and 90% on fee-based.  Although, depending on your transactional production level, you can move up to 83%.
 
But there are way more factors to consider than just payout.  We had a heavily transactional business model before we went indy, but we chose LPL for many other reasons.
Mar 19, 2009 1:58 pm

Since you are experienced at this what are the other reasons?  To me, it's support and technology.  Behind that would be name recognition and a feeling of safety since Madoff screwed us all up.


I like the LPL websites for brokers and I was reading where one of the two would help with the business succession plan.  I have a partner I would like to bring with me who is older than I and I really need to sell him that he will make more money than if we stay put.  Another big factor for me will be what agreements with the mutual funds and variable annuities because I don't want my clients to have big capital gains on their mutual funds if they don't have to.
Mar 19, 2009 2:51 pm

Can't speak to support at RJ because I didn't end up there, but LPL support has been very good.  Technology is great at both firms. 

 
Both LPL and RJ are quite stable, with LPL not being a public company and not doing any investment banking.  We liked that.
 
I think both firms are great firms, but for us, there was at least 12 RJ offices in our town - and we didn't want to be number 13.  Obviously, you won't have the name recoginition with LPL as you do with RJ, but we have not found that to be a barrier in moving our clients over at all.
 
Our decision was based on a few smaller factors like compliance rules and the deal we got to come over (LPLs was less, but structured better for us), but the main reason we chose LPL was how they treated us.  We didn't care for the way RJ presented themselves to us... a bit snobby and very clear that we would "work" for them.  In other words, they were the boss.
 
I doubt you'd have to sell anything to make a move to either firm, as both have selling agreements with almost every fund and annuity company.
 
Like I said, contact your local recruiter and do a home office visit, you'll gain a lot of understanding about the firms and the culture.  That's imperative because they will be your business partner.
 
hth
Mar 20, 2009 1:47 am

Will LPL accept Waddell funds and can I sell them.  In addition will the trails be paid?

Mar 20, 2009 6:12 am
BiLo:

Will LPL accept Waddell funds and can I sell them. In addition will the trails be paid?





I do know that LPL has a selling agreement with Ivy Funds. Weren't they formerly W&R?

Mar 20, 2009 9:43 am

BiLo, I'm at a privately held self clearing bd whose culture and environment is a lot like that of AG Edwards but on a smaller scale. We have both and independent channel and traditional wirehouse side as well. If you would like more info you can PM me.

Mar 21, 2009 9:06 pm

I don't know much about AG except it sounds like Wach screwed them up.  I'm looking for good tools, good products, help with compliance and a good payout.

Mar 23, 2009 11:35 pm

The payout from both these firms depends on the assets and revenues.  I helped a group figure out their revenues... had $600 million in assets, but really did not know their revenues as the big firms make it confusing.  At RJ their payout is 50%.  You would think with $600 million the payout would be greater, but they all figure out a way to make it between 50-60%.  If you really want to go independent, why not open your own shop utilizing the big custodians.  If you need a BD, I have a few contacts that can help you as long as you have good revenue.  This is not an easy question as it is all dependent on your revenue stream as to how well firms treat you.

ash
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