Altruist, the custodian for independent registered investment advisors (RIAs), has launched a self-clearing brokerage dubbed Altruist Clearing, offering a fully-digital alternative to the industry dominated by legacy financial institutions.

Altruist Presents Altruist Clearing

According to the announcement shared with Finance Magnates, RIAs have experienced an annual growth rate of 12% since 2016, making them the fastest-growing category in the US wealth management market. Despite the fast growth, traditional financial institutions have historically underserved RIAs, even though they hold 80% of the $7 trillion in advisory assets.

Altruist wants to change that by offering its newest self-clearing services, combining them with the current software suite, lower fees and expanded customer support. This will give RIAs access to a custodian that manages client assets in a faster, safer and cheaper way. Launching Altruist Clearing makes the firm the industry's first all-in-one custodian.

"From day one we've always planned to become self-clearing, as it's the best way to provide maximum value to advisors. With this step, we're able to build features tailor-made for RIAs and their clients, which accelerates our mission of making financial advice better, more affordable and accessible to everyone," Jason Wenk, the CEO at Altruist, commented.

Altruist's decision to self-clear provides them with a technological edge over other technology platforms and custodians that rely on third-party clearing houses. By taking complete control of its product roadmap and support model, Altruist intends to create fresh and inventive wealth management features that are unavailable through custodians who concentrate on retail service models.

"Now, as a full-service custodian, we are excited to be able to provide our platform to advisors of all sizes who have been underserved by existing options," Mazi Bahadori, the Chief Compliance Officer and EVP of Operation at Altruist, added.

The Altruist platform offers RIAs a range of capabilities that can help them save time, reduce costs, and generate additional revenue. These include digital account opening, an intuitive client-facing mobile app, one-click commission-free trading, automated rebalancing, flexible fee billing, live chat support with experts, fractional shares, and hundreds of model portfolios.

What Is RIA?

Registered investment advisors (RIAs) provide advice on securities investments and manage investment portfolios for clients. They are required to register with either the state securities administrators or the US Securities and Exchange Commission (SEC). As fiduciaries, RIAs must always act in their clients' best interests when providing investment advice. This duty is fundamental and non-negotiable.

Despite the challenges posed by a difficult stock market in 2022, the fee-only registered investment adviser industry experienced a surge, with total client assets exceeding $3 trillion for the first time in history, according to InvestmentNews'. The review includes firms with $100 million or more in assets and categorizes them into four US regions: the Northeast, West, Midwest, and South. Across all four areas, 3,006 RIA firms reported $3.015.5 trillion in assets in 2022, compared to $2.493.5 trillion in 2021, representing a year-over-year increase of $522 billion or 20.9%.