Although female advisors make up a smaller portion of the total retail broker population in North America, they may be poised for stronger growth than their male peers, according to recent research by Toronto-based PriceMetrix Inc.
According to PriceMetrix, female brokers, who represent 12% of the total broker pool in North America, tend to have larger households in their books of business. Female advisors typically have 56 large households – those with US$250,000 or more in assets – in their books and 72 small households, according to PriceMetrix’s study. Male advisors, on the other hand, generally have 51 large households in their business and 78 small households.
Previous research conducted by PriceMetrix suggests that advisors with a higher concentration of large households tend to grow faster than others, according to Patrick Kennedy, vice-president, product and client management, PriceMetrix. “Purely from that client mix standpoint,” says Kennedy, “[Research] would suggest that women are better positioned for future growth.”
Furthermore, female brokers tend to hold median household assets of US$174,000 in their books compared to US$152,000 for male advisors.
The study conducted by PriceMetrix was quantitative in nature and did not include any qualitative data, such as interviews, says Kennedy. However, the makeup of the average female advisor book of business indicates that women are a little more selective with their clientele. “Female books clearly have more large clients,” he says, “but they also have more discipline in staying away from smaller client relationships.”
As well, the study found that female brokers also tend to have a higher proportion of female clients. According to PriceMetrix, women make up 51% of a female advisor’s business and only 44% of books owned by male advisors. In its report, PriceMetrix suggests this statistic is another reason for the potential future success of female advisors because women are becoming an important client segment.
Data for the report was gathered from PriceMetrix’s aggregated database of seven million retail investors, 500 million transactions and over US$3.5 trillion in investment assets.