Is Your Advisory Practice a One-Armed Basketball Player?

This is the latest installment of a regular column to answer questions from advisors who are considering transitioning to an RIA model. To see Brad’s previous articles, click here. To submit your question, please email Brad here.

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A broker who competes against RIAs is about as likely to win as someone who plays one-on-one basketball with one hand tied behind their back.

I challenge you to a game of one-on-one basketball.

We each use the same equipment.

The rules of basketball apply to both of us.

The points per basket will be the same.

One caveat: You must play with one arm tied behind your back.

Sound fair?

If such a scenario seems preposterous, consider if you’re currently a one-armed player as an advisor.

Attracting and retaining clients is hard. Competition is everywhere. Margin compression abounds. Value propositions are ever-expanding.

Would it make sense to voluntarily handicap your chances as you compete for clients? Would you play with one arm behind your back? Or would you want a level playing field?