Articles Written by Jon Henschen

Price’s Law And Large Broker-Dealers

21:42 01 November in Articles Written by Jon Henschen by rafferty

October 29, 2021 By Jon Henschen, FA Financial Advisor It was Derek Price, a British physicist and information scientist, who discovered that it was often a small percentage of subject matter experts among his peers who dominated the publication of academic papers. From him we get Price’s law, which says half the publications on a subject are written by the square root of all the contributors (in other words, that five people out of 25 will get half the work done). Let’s adapt that rule to corporate cultures. Jordan Peterson, a best-selling author and professor of psychology, says Price’s law suggests that as a company grows, the incompetence grows exponentially and competence grows linearly. It means that if a company has 10 people, three people (30%) are doing half the work, and at...

How Proprietary Advisory Platforms Conflict With Fiduciary Standards

13:23 22 September in Articles Written by Jon Henschen by rafferty

September 21, 2021 By Jon Henschen, ThinkAdvisor What You Need to Know Broker-dealer corporate RIAs are seeking to recruit advisors who will bring large amounts of assets to their proprietary platforms. The conflict-of-interest standards for promoting products like mutual funds don't seem to apply to advisory platforms. To keep assets flowing to their best profit centers, some BDs are keeping their advisors in the dark on better offerings. Broker-dealer corporate RIAs have jumped on the proprietary advisory platform bandwagon at a rapid clip over the last five years. We’ve been approached by broker-dealers wanting us to recruit advisors to their broker-dealer with a focus on bringing advisors to them, not only with a large percentage of advisory assets but assets that will specifically go into their proprietary advisory platform. Financial products such as mutual...

It’s All Hands on Deck as BDs Enter Rougher Waters

16:56 27 May in Articles Written by Jon Henschen by rafferty

By Jon Henschen As featured in the June issue of Investment Advisor magazine Here’s why so much of our industry’s financial future is tied to compliance and what that means for today’s broker-dealers. The next few years will be all about regulation, as brokerdealers figure out the proper balance of Regulation Best Interest’s disclosure, tracking and recordkeeping. Advisors at some broker-dealers tell us the new disclosures required to satisfy regulators have become suffocatingly unacceptable, though not much has changed at other firms. The future balancing act for most broker-dealers, though, will be implementing enough disclosures and recordkeeping to avoid fines but not so much that their advisors find the paperwork and related requirements oppressively long and complex. Geneos Wealth Management President and Chief Compliance Officer Jodee Brubaker-Rager feels that by having its own technology firm, the...