NFP Advisor Services Group (formerly NFP Securities) announced a new partnership today with institutional consulting firm DiMeo Schneider & Associates, giving its 1,700 advisors access to DiMeo’s investment research capabilities. The firm hopes the new research will give NFP advisors a leg up on the competition and help attract higher-producing advisors.
Kristen Whisnant, senior vice president of advisory and investment services at NFP, said one of the reasons they chose DiMeo Schneider was for its institutional-level research, something most advisors don’t have access to.
“In an industry where information is readily accessible, how do we give [our advisors] something with some exclusivity that can provide them with a competitive edge?” Whisnant said. “To be able to bring that caliber of research to our advisors to deliver to clients on a retail level was really powerful, and that’s just not something they would have access to otherwise.”
The deal will give NFP advisors access to DiMeo’s proprietary asset allocation tool and the firm’s research on investment managers. The firm meets with 600 to 700 managers and/or analysts a year, said Robert A. DiMeo, managing director and co-founder of DiMeo Schneider.
“It really gives the advisor the ability to have some confidence in funds and offerings that they’re bringing to their clients, to know that these have been vetted, not only through our 20- plus person research effort, but ultimately through our 10-person investment committee,” DiMeo said.
Chip Roame, managing principal of Tiburon Strategic Advisors, a Tiburon, Calif.-based market research firm, believes the move is driven by the desire for more institutional-level research, but also the ability to differentiate NFP’s advisors from the competition.
“Many financial advisors now have similar technology platforms with similar managers,” Roame said. “Gaining access to some unique managers and/or having some reasons to recommend some managers over others can now be the differentiators between competing advisors who might have essentially the same product offering.”
Another example of this would be Dynasty Financial Partners, which added the research capabilities of institutional consultant Callan Associates late last year. The firm was hoping the addition would draw more high-end wealth advisors to its platform.
Greg Cherry, senior analyst at Aite Group, said there’s more demand from retail advisors for institutional research. Morgan Stanley Smith Barney, for example, has been putting institutional managers on its managed account platform. Some of the wirehouses have also adding institutional-level allocation models and manager research, Cherry said.
“In effect, this is kind of taking a page from that playbook and bringing it over to the NFP model.”
Similar to Dynasty, the new capabilities can also be used by NFP as a recruiting tool, DiMeo said.
In particular, such capabilities can be attractive to higher-end advisors, RIAs especially, who are looking for more sophisticated research, Roame said.