Thoughts on Working at or Starting an RIA Practice?
What exactly is a Registered Investment Advisor? I know they get a 1% AUM fee. Is there any prestige in this field? Also, it seems like its a 1% percent fee for doing absolutely nothing? How hard is it to start one? Any thoughts about this topic would be appreciated.
Thanks
Becoming a Registered Investment Advisor (RIA) (Originally Posted: 11/20/2014)
RIA's can exercise discretionary investment authority over assets under management. Which almost makes them "mini-mutual funds" or "mini-hedge funds". Though, I know there are differences like you can manage non-accredited investor money as an RIA, etc... Still, investing other people's money for a living, while it may not be a hedge fund, sounds sexy.
Has anyone had any experiences starting a one person RIA shop that you'd like to share?
How fast did you build assets under management (and qualify that with how many years of related experience you've had)? I would imagine the less relevant work experience you've had, the harder it is to acquire clients and build AUM.
Given enough accredited investors, can you later convert it to a hedge fund?
Did anyone get an MBA either before or after doing this?
Most RIAs, discretionary or non-discretionary, allocate their clients' capital to mutual funds and in some cases private equity/hedge funds. RIAs these days are typically picking money managers, not individual securities, so they are not like mini hedge funds.
Not always true. I have several friends who left the wirehouse world to start an RIA and I've seen some work with money managers and others that only pick individual securities. More often than not they simply duplicate the business model that they were working with before the formation of the RIA.
My experience has been with advisors that already had a build book of business and then left to go form an RIA. That being said the ones that I know have been very sucessful in adding AUM but these were experienced pros that could have done the same regardless of where they worked.
Never have known anyone convert an RIA to a hedgefund....why would you want to?
Eos rerum sunt asperiores sed modi commodi ducimus. Odit voluptatem itaque dolore velit. Repellendus sit delectus et quas doloribus commodi saepe. Sunt consequuntur odio tempora. Nostrum aperiam magni accusantium omnis distinctio eius.
Accusantium consequuntur laborum et iusto aut voluptas repudiandae. Qui rerum magnam a deserunt officiis et fugiat. Eos qui culpa quo autem. Quo earum sed rerum non sint occaecati.
Qui quis occaecati necessitatibus impedit quam aliquam reiciendis. Ipsam amet autem neque saepe. Et assumenda quibusdam quo laborum.
See All Comments - 100% Free
WSO depends on everyone being able to pitch in when they know something. Unlock with your email and get bonus: 6 financial modeling lessons free ($199 value)
or Unlock with your social account...