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Fee Based at Wirehouses

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Sep 17, 2008 1:26 am

I just read an interesting statistic about Morgan Stanley. It said that of the $707B in AUM that MS manages, only $186B are fee-based. I would have expected much more. I am curious if that is about the same at all of the wirehouses. I assume Merrill’s % of fee-based is higher, but I am curious what it is. Does that imply that the other 70%+ is transactional? Maybe that’s a dumb question, but I just would have thought it were higher.

Sep 17, 2008 1:35 am

That is 23% fee based on assets. That translates into about 40% fee based gross. ROA is higher on fee based. I have 40% fee based assets but my fee based gross is 72%

Its probably about right in line with the other wires
Sep 17, 2008 2:22 am

Yeah, those numbers are right…there are plenty of very successful people at wirehouses that do a good bit of transactional business. However, not all of the non-fee based AUM are in straight transactional accounts; plenty of 12b1 revenue and other annuitized type revenue. I think SB and ML are both higher than MS in terms of % of AUM in fee-based accounts.

Sep 17, 2008 1:04 pm

Good point.  This number probably doesn’t include C-share trails.  Didn’t think about that.

Sep 17, 2008 2:26 pm

That number does not include C shares and level load annuities.