https://www.pricemetrix.com/new-pricemetrix-study-finds-female-advisors-large-households-men-consistent-pricing-women-clients/

PriceMetrix

New PriceMetrix Study Finds Female Advisors Have More Large Households than Men, More Consistent Pricing and More Women as Clients

November 13, 2013, Toronto, ON – A new study from PriceMetrix, a practice management software and data services company, shows women have larger clients, price more consistently and service more female investors in their books of business.

“Bigger clients and more consistent pricing, not to mention a higher proportion of female clients, are significant advantages,” noted Doug Trott, President and CEO of PriceMetrix. “Taken together, these factors suggest women advisors are better positioned than men for future success.”

In previous research, PriceMetrix has demonstrated that advisors with a higher percentage of large households in their books do better over the long run than advisors with a lower percentage. In the new study, PriceMetrix finds that the typical female advisor has 56 large households, which are defined as having $250,000 or more in assets, and 72 small households. The median male advisor, on the other hand, has 51 large households and 78 smaller ones. The average household for women has $178,000 in investment assets versus $152,000 for men.

“We have consistently found over time that advisors do better when they concentrate on large households and pare back their smaller ones,” said Mr. Trott.

To complete its study, PriceMetrix drew upon its aggregated database of seven million retail investors, 500 million transactions and over $3.5 trillion in investment assets. PriceMetrix puts the proportion of female advisors in North America at twelve percent.

To be sure, PriceMetrix finds similarities between male and female advisors, as well as some advantages for men. Male and female advisors have almost the same percentage of managed and fee based business, with 22% for men and 21% for women. In terms of pricing, PriceMetrix finds men charge slightly more than women. Looking at overall revenue on assets, the firm finds men charge 0.77% RoA compared to 0.73% for the typical female advisor. This is largely due to differences in pricing transactional business. The typical male charges 0.58% RoA on transactional business versus 0.54% among women. On fee and managed accounts, the sexes are almost the same: 1.13% for women, 1.14% for men.

Digging deeper, however, PriceMetrix finds women price more consistently than men. Among female advisors, the range from discounters to those charging a premium on overall RoA is less than one percent, 0.34% at the low end to 1.29% on the upper end. Among male advisors, the range is well over one percent, 0.33% to 1.58%.

“Ultimately, neither X nor Y chromosomes determine the quality of an advisor’s practice, the advisor does,” commented Mr. Trott. “The prerequisites for success, though, are a consistent pricing strategy and knowledge of where opportunities lie in one’s book.”

Female advisors have an advantage, though, among women. The typical female advisor has slightly more women as clients than men, 51% versus 49%. By contrast, the typical male advisor has more men than women, 56% compared to 44%.

About PriceMetrix

PriceMetrix is the first choice in practice intelligence solutions for retail brokerages in North America. We help wealth management firms enhance revenue growth, by enabling advisors to recapture lost revenue opportunities. By combining industry know-how with powerful aggregated market data, we help our clients increase overall firm profitability.

PriceMetrix directly measures aggregated data representing 7 million investors, 500 million transactions, 3 million fee-based accounts, 7 million transactional accounts, and over $3.5 trillion in investment assets. PriceMetrix combines its patented process for collecting and classifying data with proprietary measures of revenue, assets, and households to create the most insightful and granular retail wealth management database available today.

Founded in 2000 and headquartered in Toronto, Ontario, we service a notable range of retail wealth management firms within the United States and Canada. To find out more, please visit www.pricemetrix.com or call and email us at 1-866-955-0514 and info@pricemetrix.com.

Media Contacts

Patrick Kennedy
Chief Customer Officer
PriceMetrix Inc.
416-955-0514 ext 227
patrick.kennedy@pricemetrix.com