The third quarter saw 650 advisers set up somewhere new and marked the busiest quarter for adviser switches in over a year, according to Adviser Ratings’ Musical Chairs report.
The switching was evenly spaced across the quarter for the most part, with slightly more action in July.
Adviser Ratings found that with corporate activity still largely in retreat, many of the switches were at an individual level.
“As such, we saw advisers licensed under larger, diversified licensees splintering off into dozens of small- to medium-sized private licensees,” the agency said.
With the exception of last year, when switched adviser movements dropped to 571 in the three months to September, the third quarter has commonly been known for adviser switches. Namely, in 2020 between the months of July and September, 778 advisers made the move, while a year earlier as many as 1,218 opted to switch.
New adviser numbers rise
The number of new advisers entering the profession hit three digits in the third quarter for the first time since 2019, according to the report.
However, the 100 entrants still fell well short of what’s needed to make up for the continuing exits.
Adviser Ratings reported 762 departures during the quarter, with the vast majority exiting in September.
July was the quietest month for exits across the calendar year, while September had more departures than any other month in 2022.
“A number of the exits were linked to the final exam deadline for those who had twice failed. In July and August, just half the advisers who sat the exam passed, and more than 75 per cent had sat the exam previously,” Adviser Ratings said.
It noted that “heavy declines” in the limited licensee space once again, while the diversified and stockbroker licensee segments each lost more than 100 advisers.
How many of the adviser switches have been bridges advisers having to move as IOOF pushed for employed planners only and no business owners with bridges?