What Type of Independence is Right for You?

14 July 2022 by National Bank Independant Network
Three National bank experts share their thought about money taboo

As a Portfolio Manager (PM) at a large brokerage, you may have considered making a change. Perhaps you'd like to chart your own course by breaking away to start your own business. Or you may crave an environment with more freedom and better compensation while continuing to work for an employer.

You are not alone. The good news is that there are many paths to choose from, with different degrees of independence. Each one is highlighted below.

1. Launch your own firm

One option is to start your own firm. Great candidates for this option tend to have an entrepreneurial spirit with a strong sense of relationship management and good networking abilities. They are passionate about investment strategies and how they seek returns for clients. From policies and procedures to marketing to compliance, they build their businesses from the ground up. In other words, you will be in charge of all aspects of the business, from vision to execution. The required credentials are a Chartered Financial Analyst (CFA) or Chartered Investment Manager (CIM), plus experience1. These qualifications will allow you to register with your provincial securities commission as a PM, a key step in the process.

It is a big undertaking that can come with great rewards. When you run your own firm; you will have greater flexibility and freedom when making your investment decisions on behalf of your clients; you can serve your clients as you see fit. The possibility of increased revenue is another significant benefit. Advisors who start their own firms often benefit from an increase in revenue and also direct where and how to manage their expenses.

This path means that you are in charge, but you do not have to do it alone. Lots of support is available to help you set up your business. For more on this topic, check out a video featuring Jayson Ayres, CEO of Croft Financial Group.

Visit NBIN's webpage on Going Independent for a variety of resources and information on starting your own firm.

2. Join an existing firm

If full independence is not the right fit for you, but you are potentially looking to transition from a large bank-owned brokerage firm, you may want to consider joining an existing independent firm. Hundreds of successful independent firms are thriving across the country, many of which are doing so by bringing new advisors and their teams on board. You could join as an employee of the business or potentially seek part ownership; it will depend on your specific situation and what both parties bring to the table.

Joining an established independent firm strikes a balance between freedom and responsibility. While each situation is different, you can likely expect greater freedom in managing clients' portfolios. You won't have to build the business from scratch: systems, processes and procedures, and compliance oversight will be in place.

Choices available to you in this category will depend on your registration capabilities, education, and cultural fit.

To join an independent firm as a portfolio manager requires a CFA or CIM designation and experience1. you have completed the Canadian Securities Course (CSC) or Conduct and Practices Handbook Course (CPH), there are lots of other possibilities to explore, such as relationship manager or associate advising representative.

Your skills and interests, as well as the firm's needs and culture, play essential roles in establishing a good match. For example, if you are passionate about a particular investing strategy, you can connect with firms that are open to new ideas versus a more conservative environment. If financial planning is your passion, a firm lacking a certified financial planner could be the perfect match.

NBIN has a process to help match prospective advisors/candidates with firms we support across the country.

3.  Join a Canadian Investment Regulatory Organization (CIRO) firm

Another option to enter the independent space is to join an independent CIRO-registered firm as an employee.. It is more independent than a bank-owned brokerage environment. However, you will continue working "for" the firm, and the organization may influence how you manage your assets.

Overall, this will be less of a transition from a large financial institution than moving to an independent PM firm. If you are looking for a modest increase in independence and a potential payout, this could be a great option.

The next step

As Canada's leading custodian for independent portfolio managers and carrying broker for Independent CIRO firms, NBIN is well-positioned to help you explore your options.

With over 30 years of experience, we are well equipped to help you build your business as an independent. We will be your partner to help you navigate the industry and build your firm from the ground up. Your vision. Your way.

If you'd prefer to explore the possibility of joining a firm, we can connect you with great candidates among the more than 400 independent firms we serve across the country.

Regardless of what path you choose, know that you have options! Reach out and  to our team.

1 National Instrument 31-103 Registration Requirements, Exemptions And Ongoing Registrant Obligations.

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