Number of Investment Advisers Hit Record High in 2022

The uptick occurred even as assets under management fell for the first time since the 2008 financial crisis, according to an annual study.

The number of investment advisers in the U.S. hit a record of 15,114 in 2022, even as assets under management declined for the first time since 2008, according to an annual report by the Investment Adviser Association and National Regulatory Services, a Comply company.

The country added 308 fiduciary advisers, or 2.1% more than last year, in part to meet demand for people looking to navigate turbulent markets, according to the annual Investment Adviser Industry Snapshot. The report, in its third year, is drawn from investment advisory data filed with the Securities and Exchange Commission on Form ADV Part 1A.

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“Investors are increasingly engaging investment advisers, which continuously provide investment management advice as fiduciaries,” Karen Barr, the CEO and president of the IAA, said in a statement. “Over the past five years, over 22 million more individuals have engaged an investment adviser for asset management—a rate of growth in both the number of individual clients and assets of roughly 12% per year.”

The growth came even as market conditions brought assets under management down 11.1%, only the third drop in the past 22 years; the other drops occurred during the 2008 financial crisis and burst tech bubble of 2002. 401(k) accounts were also hit by market declines, with retirement benefits firm Alight reporting a 14.7% drop in the median return for investors in defined contribution plans last year.

Investment advisers managed total assets of $114.1 trillion last year for 61.9 million clients. Clients using asset management services grew by 2.1% to a record high of 54.3 million. The total number of clients—including those using financial planning services—declined by 4.3% as digital advice offerings evolved, according to the IAA and Comply.

While growing overall, the investment advisory industry continues to experience significant churn, according to the report, with 834 firms terminating their SEC registration. The turnover was concentrated among advisers with less than $1 billion in assets.

Last year, 88.5% of advisers had less than $5 billion in AUM, and more than half had between $100 million and $1 billion, according to the report.

The organizations also noted the impact of the SEC’s newly introduced marketing rule, which the regulator has continued to broaden and clarify as recently as earlier this month. Nearly 40% of advisers included performance information in advertisements in 2022 to comply with the rule, according to the report—though the data collection was not comparable to 2021, as it came from new questions in the filings.

Both the number of funds and assets under management continued a 10-year trend of increasing more rapidly for private equity funds than for hedge funds, according to the report. Private equity funds in 2022 accounted for 44.2% of the number of private funds and 32.8% of private fund assets.

“This year’s report underscores the diverse nature of the industry and its continued growth, most notably in terms of the number of firms and the number of private funds,” John Gebauer, Comply’s chief regulatory officer, said in a statement. “These trends are clearly having an impact on the SEC’s focus areas for examinations and rulemaking, as evidenced by the proposals made this year which aim to increase protections for private fund investors.”

The organizations noted that over the past 22 years, the growth in the number of SEC-registered advisers has been consistent with economic growth, as measured by GDP. Growth in assets under management has been affected by stock market performance.

Retirement Industry People Moves

DriveWealth appoints Pizzorusso as global CFO; Burke joins Cetera Advisors; Hub International Mountain Welcomes Executive VP; and more.  


DriveWealth Appoints Pizzorusso as Global CFO
 

DriveWealth LLC announced the appointment of Jason Pizzorusso as global chief financial officer.  

In his new role, Pizzorusso will lead strategy and development of the company’s global growth. Prior to joining DriveWealth, he spent 16 years at Morgan Stanley, most recently as CFO of the wealth management segment.  

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“Jason is an exceptional leader with a proven track record of success in our industry,” Bob Cortright, DriveWealth’s CEO, said in a statement. “His expertise and extensive knowledge across both finance and technology will be instrumental in driving our growth and global expansion.”  

Burke Joins Cetera Advisors 

Cetera Financial Group announced that senior financial adviser Janet Burke has affiliated with Cetera Advisors by joining Sunrise Wealth Advisors.  

Burke oversees approximately $50 million in assets under administration, as of May 31. These assets will now be housed with Cetera Advisors. She was previously affiliated with Ameriprise Financial Services LLC. 

“As a woman in the wealth management field, I’m thrilled to join Cetera, where I feel my unique experiences and voice are both heard and understood,” Burke said in a statement. “I’m also excited by the prospect of offering a boutique-style investment experience to my clients, which is a trademark of Sunrise Wealth Advisors.” 

Hub International Mountain Welcomes Jones as Executive VP 

Scott Jones 

Hub International Mountain States announced Scott Jones as executive vice president of employee benefits sales.  

Jones has held leadership positions in employee benefits sales groups as a high-level executive at Hub International since 2015.  

In addition to his professional achievements, Jones, based in Boise, Idaho, is involved in multiple small businesses within his family. Hyde Perk Coffee, 44 East Boutique (Meridian) and All-In Wrestling are just a few examples of his ventures. 

Sequoia Promotes McCauley, Tichnell, Hires Glick as COO 

Sequoia Financial Advisors LLC announced that Annie McCauley has assumed the role of executive vice president and chief client experience officer, while Kevin Tichnell is now chief strategy and acquisitions officer. In addition to the two promotions, Joseph Glick has joined the firm as executive vice president and chief operating officer. 

“Our priorities are organic growth, selective acquisitions, and operational excellence,” Tom Haught, founder and CEO of Sequoia, said in a statement. “Annie is now responsible for organic growth and unifying our client experience, asset management and planning. We welcome Joe to Sequoia in the key role of overseeing our growing operations and breadth of services. Kevin will focus solely on leading our M&A efforts.” 

Stone Ridge Appoints Mathas as Senior Adviser 

Stone Ridge Holdings Group announced that Ted Mathas has joined as a senior adviser. Mathas had served as New York Life chairman and CEO for more than 14 years.  

Mathas, who retired from New York Life in April 2022, will help Stone Ridge scale its innovative suite of products purpose-built for financial advisors and insurance companies. Additionally, he will provide mentorship and guidance to its executives and operating subsidiaries. 

“I am fortunate to be in a position where I can retire from a full-time role and company I love, but not stop working on things I care deeply about with people who share my values and passion,” said Mathas. “I’m especially excited to help develop and distribute Stone Ridge’s breakthrough innovation of embedding longevity pooling inside asset management strategies.” 

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