A weekly update on issues important to the Investment Management industry
Each year, we close our blog with a holiday poem inspired by Clement Clarke Moore’s A Visit from St. Nicholas. This season, with markets at record highs but public trust in institutions on shakier ground, it seemed fitting to summon the ghost of J. P. Morgan himself. In “The Ghost of Trust,” Morgan visits on a December night in New York to remind us that even in an age of algorithms, skyscrapers, and artificial intelligence, the most important capital a firm can hold is integrity.
As firms sort through the “leftovers” of 2025, several themes are poised to carry meaningful weight into 2026. Margin discipline, improved client engagement, and rising operational maturity have strengthened the industry’s foundation. Strategic dealmaking, evolving succession plans, and measured progress with AI adoption continue to shape valuations and competitive dynamics. These lingering trends aren’t remnants—they’re the building blocks of a resilient, opportunity-rich year ahead for RIAs.
Schwab’s announcement that they’re halving client referrals to RIAs through the SAN program threatens an industry that was already struggling with organic growth. Dependable, sustainable growth requires building a marketing strategy that isn’t dependent on outside factors like ambitious custodians, and a tracking system to know how that marketing strategy is performing. Keeping an eye on your metrics will help keep you on the road to lasting value.
RIA M&A activity rebounded sharply in 2025, with record deal volume in the first half of the year. Through September, 209 transactions were completed—up from 156 in 2024—driven by private equity involvement, lower borrowing costs, and ongoing consolidation trends. While total transacted AUM declined, serial acquirers and aggregators continued to dominate deal flow. For RIAs, shifting rate dynamics, valuation trends, and evolving buyer profiles highlight the importance of strategic planning—whether pursuing growth, transitioning ownership, or exploring a sale.
RIAs delivered mixed results in Q3 2025, with larger asset managers leading the sector at an 11% quarterly gain, outpacing the S&P 500’s 8% return. Smaller managers rose modestly, while alternative managers continued to lag after a stretch of strong growth in 2023 and early 2024. On a year-over-year basis, traditional managers remained ahead of the index, while alternative managers posted the strongest revenue and EBITDA growth despite muted price performance. We explore further in our Q3 2025 Market Update.
Clear communication is essential in family business governance, yet shared definitions are often overlooked. That’s why the UHNW Institute’s new Wealthesaurus caught our attention. This online glossary brings clarity to the complex vocabulary of family wealth and enterprise conversations. This resource also provides standardized definitions of common and specialized family wealth advising industry terms. For directors, it’s a valuable reference that supports informed decision-making and effective dialogue across generations.
In the late spring of 2015, Brooks Hamner and I were having lunch and started talking about creating a blog to explore what we were seeing regarding valuation and advisory projects in the RIA space. The big question was not whether we could start it, but whether we could keep it going.
Most blogs start strong for a few months and then kind of fade out. When we got back from lunch, I pulled up a Word doc and Brooks and I started brainstorming topics. In a few minutes, we had several dozen ideas, so it was pretty clear we had enough to say.
Ten years later, we still haven’t run out of ideas.
Looking back, though, we do see a few themes on heavy rotation. I doubt that will change.
AI is expected to have a significant impact on the RIA industry. This relatively new technology is already reshaping how RIAs manage assets, engage with clients, and navigate an increasingly competitive landscape. For RIA owners, understanding and leveraging AI is becoming critical to maintaining a competitive edge, enhancing firm valuations, and ensuring long-term success in a mature but evolving industry. This post explores the multifaceted impact of AI on the RIA industry while providing actionable insights for firms looking to adapt.
M&A activity in the RIA space rebounded strongly in early 2025, with record-setting deal volume in Q1 and continued momentum into Q2. A favorable interest rate environment, increased private equity involvement, and a growing number of serial acquirers helped fuel activity. Despite a sharp decline in total transacted AUM, deal count and strategic interest remained high. For firms exploring growth, succession, or liquidity, understanding the evolving M&A landscape—and aligning your strategy with the right partner—has never been more critical.
One of the most frequently overlooked sectors in the wealth management industry may be its first cousin, the independent trust industry. While many still associate trust administration with banks, which account for more than 75% of the space, the growing prominence of independent trust companies is capturing the attention of many participants in the investment management community. In this post, we examine current trends impacting independent trust companies.
RIAs generally outperformed the S&P in Q2 2025, with smaller asset managers returning over 13%, and alternative asset managers facing another quarter of underperformance after a year of strong growth. Year-over-year, alternative investment managers saw the strongest AUM growth, while traditional managers proved better at converting this growth to earnings. We explore further in our Q2 2025 Market Update.
Over the next two decades, an estimated $68 trillion is expected to transfer from Baby Boomers and Gen X to Millennials and Gen Z in what has been dubbed the “Great Wealth Transfer.” For RIAs and trust companies, this transition presents both opportunities and challenges that directly impact firm valuations. As client demographics evolve, investment management firms must adapt to retain AUM and navigate the valuation implications of this seismic wealth shift.
For this week’s edition of RIA Valuation Insights, we revisit our whitepaper, “Succession Planning for Investment Management Firms.” The updated whitepaper complements next week’s webinar, “Succession Planning for RIAs: Transition with Confidence,” with RIA team leader and CEO of Mercer Capital, Matt Crow and RIA senior team member and Senior Vice President, Brooks Hamner. You can register for the webinar in the post.
M&A activity in the RIA industry, which had been trailing 2023 levels for much of 2024, experienced a surge in January. This spike set a new record for monthly deal volume, exceeding the high watermark set in October 2024, with Q1 2025 was a record-setting quarter for deal volume. In this week’s post, we review what Q1 2025 M&A data means for your RIA.
Amid stabilizing interest rates and inflation, the asset management industry (and the stock market as a whole) experienced moderate growth over the past year. However, our index of publicly traded asset management firms generally tracked the movement in the broader market, with stock prices for smaller asset managers (AUM under $250 billion) up 4.4% and large asset managers (AUM over $250 billion) up 7.2% over the year ended March 31, 2025, while the broader market (S&P 500) was up 8.5%. With recent tariff announcements instigating a market drawdown as investors brace for an ongoing trade war, what does this mean for RIAs? The prospective outlook for asset managers in the coming months will depend on a few factors, which we detail in this week’s post.
RIAs underperformed the S&P in Q1 2025, with alternative asset managers declining almost 20% after a year of outperformance. Year-over-year, traditional investment managers saw the strongest AUM growth, while alternative managers proved better at converting this growth to revenue. We explore further in our Q1 2025 Market Update.
Higher interest rates over the past three years haven’t had much impact on RIA transaction multiples. As rates started to fall in 2024, we saw the possibility of further support for transaction activity throughout the investment management community. The political and economic environment of early 2025 seems to be pointing to a new risk not seen since the late 1970s, and it isn’t too early for leadership at investment management firms to consider (model) what might happen if we find ourselves revisiting some of the challenges of the Carter years: stagflation.
The wealth management industry experienced remarkable growth in 2024, driven by robust market performance, inflation cooling, and shifts in monetary policy. Contrary to earlier concerns of economic instability, the year delivered substantial growth across the RIA sector, signaling resilience and adaptability in an ever-changing financial landscape. As the wealth management industry looks to 2025 and beyond, the dual drivers of demographic change and technological innovation will play a pivotal role in shaping its future. Firms that effectively embrace these trends—by deepening client relationships and harnessing cutting-edge technology—stand to emerge as leaders in an increasingly dynamic and competitive market.
M&A activity in the RIA industry, which had been trailing 2023 levels for much of 2024, experienced a dramatic surge in October. This spike set a new record for monthly deal volume and brought year-to-date transaction figures through November in line with 2023’s pace. In this week’s post, we look at the convergence of factors driving a surge in M&A activity within the RIA industry and what that means for your RIA.
RIAs continued to outperform the S&P in Q4 2024, with alternative asset managers boasting an impressive 60% price gain year-over-year. In 2024, traditional investment managers saw the strongest AUM growth, while alternative managers proved better at converting this growth to revenue. We explore further in our Q4 2024 Market Update.
It has become a tradition for the RIA team at Mercer Capital to end the blog year with a “unique” annual summary of industry events, riffing off Clement Clark Moore’s classic “A Visit from St. Nicholas.” We hope all of you in the investment management community are enjoying the holiday season and looking forward to the many opportunities of the new year. We look forward to hearing from you in 2025. For now, please enjoy the finest only holiday poem written about money management.
Abu Dhabi has been on a buying spree, announcing this week that their sovereign wealth fund was acquiring CI Financial, taking it private just over a year after a Bain-led consortium invested US$1 billion in the publicly traded investment management firm. We suspect the terms of the Bain deal formed the predicate to this week’s announcement.
Alternative asset managers fared particularly well during favorable market conditions for the RIA sector. Over the past year, both alternative asset managers and large RIAs (with assets under management, or AUM, exceeding $250 billion) outperformed the S&P 500, achieving gains of 64.6% and 37.7%, respectively. As these dynamics continue into Q4 2024, the outlook for continued multiple expansion and robust deal activity for alternative asset managers remains favorable.
Following a year where deal volume in the RIA industry nearly matched the all-time high of 2022, RIA M&A activity has cooled in 2024. Fidelity’s September 2024 Wealth Management M&A Transaction Report listed 155 deals through September 2024, down 11% from the 174 deals executed during the same period in 2023. As RIA deal activity experienced a greater decline than the broader M&A market, we explore what this means for your RIA.
