The Movement of Wealth

Abstract

The authors present the results of a survey of the 20 top American money-management firms that asks the reasons why money managers move between firms. Such results should assist to devise methods for retaining top-performing producers. Such efforts are essential to providing stability to the RM-client relationship and, therefore, work toward making a happy customer. A number of variables as they relate to the percentage of assets transferred were studied, such as years of experience, number of job changes, performance of portfolio, movements between brokerages and private banks, and proactivity of departure firm, among others. The results show that clients still tend to be more loyal to the money manager than the firm, despite recent, more aggressive efforts by departure firms to institutionalize the customer.

TOPICS: Wealth management, manager selection