Broker-Dealers Breakaway to Equity-Owned Boutiques

breakaway-broker movement

Breakaway-Broker Movement Continues…

Traditional wire-house brokerdealers and brokers/investment advisors are increasingly departing big securities firms and migrating to equity-owned boutiques that provide these brokers with private equity ownership in a business model that makes more sense to them, and hopefully more dollars.

WSJ’s Michael Wursthorn summarized this new trend in a recent column “Rise of the Broker Turned Entrepreneur…” and gives an update to continuing saga in the now multi-year “breakaway-broker” movement with extract below..

For financial advisers who launch their own independent practices, having equity is king.

Those ownership stakes are very different from the shares many held in big securities firms that previously employed them. The private-company equity comes with big advantages but also risks.

During the financial crisis, brokers at the major brokerage firms suffered a steep drop in a key portion of their compensation: the value of the shares they were given in those firms. Since then, some brokers say they generally have less interest in receiving shares in the firms they work for, instead favoring higher cash payouts, if possible.

But that attitude is being put aside by brokers who are taking flight from the big firms to launch their own practices or who join one already established. In fact, the allure of an ownership stake in a private practice is helping to push more advisers to join the growing number of so-called breakaway brokers.

For the entire 10 October article from the WSJ, click here

What The Top BrokerDealer CEO’s Are Making Now blog up courtesy of extract from

Data on executive compensation at major Wall Street banks and broker/dealers was released this week by SNL Financial. The data looks at top compensated chief executive officers at firms that are publicly traded. We’ve excerpted the chief executives running firms that manage platforms used by retail financial advisers, from the Charles Schwab Corp. to Wells Fargo & Co.

Total compensation includes salaries, bonuses, perks, incentive plans, stock and option awards, pensions and other deferred compensation, according to SNL, a research firm.
(See also: 10 best-paying indie B-Ds)

Here’s who made the most money in 2013, ranked by total compensation in their industry category as defined by SNL, and how it compares to the year before.

For the full story, please visit