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Featured Advisor

Ed Meek
CEO/Investment Advisor

Edge Portfolio Management


State: IL

At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

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High Net Worth Wealth Management Trend: Discount Brokers

The use of online discount brokers is becoming a more popular tool for high net worth wealth management, according to the latest Millionaire Corner research.

| BY Adriana Reyneri

Affluent investors are showing a decidedly independent streak and appear more likely to increase their use of online discount brokers as a high net worth wealth management strategy, according to ongoing Millionaire Corner research on the attitudes and behaviors of wealthy investors. 

Extremely high net worth investors, those with $15 million to $25 million in investable assets, like to maintain complete control over more than half (51 percent) of their sizable investments, according to our research. They turn over another 20 percent to the complete control of an advisor, and use a mixed high net worth wealth management approach for the remaining 29 percent – seeking the advice of a financial professional, but making the final decision themselves.  (Risk, diversification and taxes are the top investment criteria of the high net worth.)

What type of professionals are they most likely to go to for high net worth wealth management advice? In the future, nearly 40 percent say they plan to increase their use of an online discount broker, while one-fourth says they will use a full-service broker more.  These findings suggest a shift in attitude: Currently, 40 percent of extremely high net worth investors use a full-service broker, while 25 percent currently work with a discount online broker. (A full-service broker is the most popular type of advisor among investors from a range of wealth levels.)

Which individual firms are likely to get more business from extremely high net worth investors? Nearly three-fourths (74 percent) view Fidelity as the firm most likely to meet their high net worth wealth management needs, while more than half (52 percent) view Charles Schwab in this light. Seventy percent perceive Bank of America as a firm most likely to provide service appropriate to their needs, and 57 percent show a preference for U.S. Bank for their high net worth wealth management services.

A large financial firm that can provide a wide range of service has the most appeal to investors requiring high net worth wealth management services. Our research shows that more than three-fourths (77 percent) of high net worth investors prefer working with a large, diversified firm.

Advisors who can meet affluent investors’ high net worth wealth management needs stand to earn a high level of client loyalty: Nearly 70 percent of extremely high net worth investors say they would follow their advisor to another firm “because the relationship with the advisor is more important to me than the firm they work for.”