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Hello Advisors! As the country moves toward a full reopening, many of the things we’ve come to rely on over the past year are changing. With adult vaccination rates surpassing 60% and offices reopening, it’s natural to wonder what the rest of the year has in store for the RIA industry.
In this week’s edition of the FA Weekly, we’re doing a deep dive into advisor sentiment regarding industry growth and sharing insights from our latest investor survey. Independent Advisors Are Optimistic About Growth Despite many of the challenges of the past year, advisors are feeling positive about the outlook of the RIA industry. According to Schwab Advisor Services’ Independent Advisor Outlook Study, 47% of firms surveyed believe the industry will continue to grow more quickly than the market. That figure marks a 42% uptick from last year and a notable shift in confidence regarding long-term growth.
Source: Schwab Advisor ServicesTM Organic Growth Is Expected to Have a Greater Impact Than Inorganic Growth Despite ongoing M&A activity, the Independent Advisor Outlook Study found that organic growth is likely to play a bigger role than inorganic growth over the next year. In fact, 92% of firms said they believe existing clients and new clients will account for the bulk of additional business in the months to come. What’s more, 50% of RIA firms grew their client base more in 2020 than they have in previous years and many of those new clients are younger and more tech-savvy. According to the study, 26% of new clients also have more wealth which could lead to additional growth in the years to come. 
Source: Schwab Advisor ServicesTM Investors Are Leaning Bullish But Anticipating a Bubble Volatility has been an ongoing trend this year, but investors are continuing to stay the course. Our most recent reader survey shows that 44% of invested readers are leaning bullish, compared to 48% last month. Despite their bullishness, 63% of respondents say we are ‘in a bubble’ and 59% say they believe the market is ‘overvalued’. Cryptocurrencies are at the top of their bubble list, with more than 35% of readers saying they believe Bitcoin and Dogecoin are the frothiest.
Although investors are more concerned about the market than they have been in previous months, the majority of our readers are not making meaningful changes to their portfolios. Only about one-third of readers are making more changes since our last survey in April, and 24% say they are investing more than they were then.
The bottom line: Investors are continuing to find opportunities in market swings and they’re comfortable taking risks in the right situations. 
PODCAST The Latest from The Investopedia Express Liz Claman, anchor of The Claman Countdown on Fox Business News, and best-selling author, joins the show to talk about what’s different about the mania around ‘meme’ stocks this time compared to other market bubbles, and what worries her most about the current climate for investors. Plus, the U.S. labor market is caught in a supply vs. demand conundrum, and it is holding the full economic recovery back. What can be done to fix it. All that, and the investing term the educated investor needs to know in the week ahead, on a brand new Investopedia Express.
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