A group of Long Island-based Morgan Stanley Wealth Management advisors have left to start their own registered investment advisory firm.
Formerly known as The 360 Group while at the wirehouse, members of the firm said Thursday they had parted ways with the brokerage and founded Opal Wealth Advisors. Lee Korn, Jesse Giordano and Joseph Filosa are the three founders and advisors of the eight-person group that previously managed $650 million. The group works with a variety of private clients, many of whom are entrepreneurs, and provides investment management, financial planning, and tax and estate-planning advice.
Once the group decided to go independent, they explored all the consolidating firms that help brokers establish their own business, as well as custodians and other service providers, Giordano told WealthManagement.com. Ultimately, they decided to build Opal Wealth Advisors from scratch. “We learned very quickly that being independent isn't one size fits all,” he said.
Advisors have been trickling out of the wirehouses to the independent channel for years. But the largest wealth managers, including Morgan Stanley, are taking steps to improve their platforms and resolve complaints advisors have said drove them to leave.
In October, Morgan Stanley sweetened the deal it offers to brokers who choose to stay with the firm until their retirement, boosting career-advisors’ loyalty increases retirement payouts by 10 to 50 percent. In November the bank's wealth management unit unveiled a new advisor platform, called WealthDesk, that consolidated existing dashboards, tools and technologies and that executives claimed put it “years ahead” of competitors.
To help drive more potential clients to advisors, Morgan Stanley partnered with Yext in December, to both boost advisors' visibility online and improve communication between them and potential clients.
Morgan Stanley Wealth Management reported revenue of $4.14 billion in the fourth quarter, down 6 percent sequentially and 6 percent from a year ago. It was also less profitable. The unit reported a pretax margin of 24.4 percent in the fourth quarter, well below its goal, according to the bank. However, considering the entire year, the wealth management unit performed well overall, even as the bank continued to invest in the business. It's also keeping its eyes open for acquisitions in 2019.