In Downturn, Brokerage Recruitments Remain Firm
From the Desk of Jim Eccleston at Eccleston Law Offices:
According to a report from Mark Elzweig Company, Ltd., even though the stock market has caught a cold recently, the recruitment of big producers still remains firm.
In a bear market, firms will continue to recruit aggressively, because they’ll view a market downturn as a buying opportunity to attract advisors from rival firms. Brokerage firms will be gunning both for advisors who are looking for an upfront check and for those who are seeking to join a firm with a better platform.
The offers likely are to differ in one key aspect: The back end payment will edge higher and the front end will get a little lighter. The farther down the production chain one goes, the more that the upfront component of recruiting packages will be shaved. Advisors bringing in commissions under $500,000 will find wirehouses paring their bids, in part because during a downturn Wall Street will become less profitable. That means the pool of money for recruiting will shrink.
On the bright side, the aging and shrinking pool of advisors will keep recruiting packages up in the stratosphere — especially for large producers, but recruiting firms will opt for more of a show-me format.
The attorneys of Eccleston Law Offices represent investors and advisers nationwide in securities and employment matters. Our attorneys draw on a combined experience of nearly 50 years in delivering the highest quality legal services.
Related Attorneys: James J. Eccleston
Tags: Mark Elzweig Company, wirehouses, brokerage firms, Wall Street
