Complete Solutions for Hybrid Advisors

​Benefit from the Hybrid Approach


If you are interested in the flexibility of having your own independent RIA while leveraging the resources of Summit and its multiple clearing platforms to process your securities transactions, then Summit's hybrid RIA solution may be right for you. You have complete platform flexibility and can choose the custodian for your clients' RIA assets. If you don’t have a custodian, then we can help you select one that is best for you and your clients.

Current custodian relationships with RIAs include:

BNY Mellon
Fidelity
JP Morgan
Pershing
Schwab
Scottrade
TD Ameritrade
TradePMR

Read our white paper on the RIA landscape and our FAQs on becoming a hybrid advisor below.

Frequently Asked Questions


What is the definition of a hybrid advisor?

Simply stated, a hybrid advisor is an investment adviser representative (IAR) registered with both a registered investment adviser (RIA) and a broker-dealer. This allows the advisor to maintain a commission- and fee-based practice, or what's known as a hybrid practice.

Why would an advisor want to be an IAR?

  • Ability to offer clients both commission- and fee-based products
  • Outsource RIA compliance to the broker-dealer
  • Leverage the broker-dealer's infrastructure and support
  • Maintain their independence

Why would an advisor want to be a hybrid RIA?

  • Ability to offer clients both commission- and fee-based products
  • Complete control over the advisory products they offer their clients
  • Maintain their independence

Is there a trend of wirehouse advisors considering alternative affiliations?

Yes. According to Cerulli Associates, the fastest growing segment of the advisor channel is the hybrid channel. Conversely, the wirehouse channel is forecasted to continue to shrink over the next several years. As more and more wirehouse brokers see themselves successfully transition to one of these models, we will continue to see the hybrid space grow.

Is this business model more profitable? Does it help develop a more robust wealth management practice?

According to the Rydex Advisor Benchmarking study, the average hybrid RIA practice makes about $30,000 more per year than the average fee-only RIA. Approximately 20-30 percent of the revenue generated by these hybrid RIAs is from commissions. One can conclude that clients are now looking for ways to access non-correlated markets, and in the hybrid model, there is access to the broker-dealer's lineup of commission-based alternatives, which clients can use.

What is the cost to starting your own RIA?

To form an RIA, the cost can range from $5,000 - $10,000, depending on whether you use a consultant. This however, does not include the time needed to smoothly run the RIA. There will be intangible costs that include non-client related issues, such as creating ADVs, writing wrap brochures, dealing with outside auditors, developing written supervisory procedures, maintaining a code of ethics, performing continuity planning and hiring a chief compliance officer.

Are there any disadvantages to starting your own RIA?

There are several disadvantages to starting your own RIA, including the upfront costs to starting the RIA and the ongoing costs to maintain your RIA. In addition, you will not have the luxury of relying on a corporate RIA when handling all the potential issues which arise when dealing directly with the SEC.

If I want to be dually registered, what broker-dealer would be a good fit?

You should be looking for a broker-dealer that embraces the hybrid RIA relationship and doesn't try to get you to use their RIA platform. Only you know what's best for your clients—not your broker-dealer. In addition, you should look for a broker-dealer that can provide a high level of support from compliance, technology and practice management with a culture which matches your firm's.

What are the challenges with being a hybrid RIA?

Your broker-dealer should be able to service your particular business model based on where you decide to custody your clients' assets. You should speak with other advisors that are dually registered at that firm to make sure they support those advisors and do not try to influence them to pick their RIA platforms. Lastly, make sure the broker-dealer will be able to supervise your RIA business on the custodial platform that you choose.

Click Here to learn more about Summit's approach to RIA Services.