RJ and Makay

In the United States, the market for investors who are age 65 and older is swiftly growing.  In the next decade alone the U.S. Department of Health & Human Services projects that the 65-plus population in the U.S. is expected to grow from 40 million to 55 million, which is a 36% jump.  For the financial services industry, this means we can expect to see a lot more senior investors in the future.  However, this also means that we may be seeing more investors who are suffering from the many chronic illnesses or conditions that accompany older age, such as arthritis, diabetes and senile dementia.  Because these vulnerabilities are more prominent in the 65-and-older age group, this set of investors has very specific needs that are different than those of investors in other age groups.

Besides actively developing new products and seeking to provide financial advice and services to investors who are at or past retirement, the financial services industry also seeks to protect them. The Securities and Exchange Commission (SEC), the Financial Industry Regulatory Authority (FINRA), and the North American Securities Administrators Association (NASAA) all see the protection of senior investors as a top priority. Seniors are particularly vulnerable to fraud and abuse.  An article from the Washington Post explained that more than a third of the elderly population over seventy has some sort of memory disorder.

InvestmentNews has posted the top clearing firm rankings based upon their survey. The top 16 clearing firms represent 3,297 clients. Of these, Pershing (owned by Bank of New York Mellon) has a dominating 28% market share. Penson follows with 12%, and Fidelity with 9%. In fact, these 3 firms represent nearly half of the 16 firm client total. See 16 of the Top clearing firms ranked by number of brokers. The top 5 are 1. Pershing 2. Penson 3. NFS (Fidelity) 4. Goldman Sachs 5. JP Morgan. Raymond James was the last on the list at number 16.

Among clearing firm market share among the largest broker-dealers Pershing agains dominates with 50% market share. National Financial Services (Fidelity) is a distant second with 23% and First Clearing with 7%. No other clearing firm has more than a 3% market share for the largest IBDs. Read the full list with chart.

Financial Advisor magazine has released their findings from their 2010 RIA survey which 456 RIA firms participated. According to the reported results these RIAs saw their total assets balloon 23.3% in 2009. 50 of the firms reported a 50% growth or more and 13 firms reported a 100% asset growth or more. Mean assets per client grew by more than 11%.

The number of clients grew as well. The average number of clients among survey participants climbed more than 11%. 129 firms logged growth of 10% or more in client relationships, 70 firms reported a 20% or more increase and 19 RIAs experienced growth of 50% or more.

71 RIAs report having over $1 billion in AUM

73 RIAs report having between $500 million and a billion in AUM