Looks like a lot of recruiters out there telling Securities America advisors to bolt now that Ameriprise has put the firm on the block. But where were they when the firm was fighting for its life?
The recruiters say a move to a bigger broker-dealer -- LPL, for example -- makes sense because "there is safety in numbers."
That may be. We really have no idea where Securities America will end up or how smooth the transition will be.
However, while the Securities America reps I've been talking to are keeping their options open, they're not exactly fleeing the ship before it sinks.
For one thing, justifying a move as in clients' best interest at this point seems self-serving at best.
Are your clients really going to believe that you thought everything was fine a month ago -- when there was a non-trivial chance that the firm would be wound down instead of sold off in a single piece -- but now you're jumping in order to protect them?
For another, nobody wants to just jump randomly out of a risky environment if they have time to plan a place to jump to.
Simply heading to LPL because it's bigger -- even though it means the hassle of changing platforms -- probably falls into the "jumping out" category.
Maybe bigger is better, but it's not all or nothing. There's a whole industry out there between LPL and the tiniest boutique shops, and every single firm has its own culture, drawbacks, and advantages.
It takes time and -- ironically, given the problems that caused Securities America's problems in the first place -- due diligence to find the right fit. But if anyone runs to a big firm and then realizes a year or two from now that they made a bad choice, what will his or her clients think?