Investor satisfaction with large investment firms continues to inch upward since plummeting in 2009, and the firms with the top scores have clients who are very happy with their financial advisers and their investment performance, a new survey has found.
Overall investor satisfaction rose 14 points to 789 in this year's study, compared with last year's, according to the 11th annual J.D. Power & Associates survey of the 15 largest full-service investment firms. In 2009, the same satisfaction score, which is based on a 1,000-point scale, dropped 45 points to 731, from its 2008 score of 776.
Firms that scored above the industry average this year included RBC Wealth Management, Fidelity Investments, Edward Jones, Charles Schwab & Co. Inc., Raymond James Financial Inc., Wells Fargo Advisors and UBS Financial Services. Those scoring less than the industry average: LPL Financial LLC, Merrill Lynch Wealth Management, Ameriprise Financial Inc., Northwestern Mutual, Morgan Stanley Wealth Management, Chase Investment Services, Citigroup Inc. and Axa Advisors LLC.
Investors from the firms with lower scores said they aren't clear about the financial plans their advisers have developed for them and aren't sure about the value they receive from the adviser and the firm, said Craig Martin, director of investment services at J.D. Power.
Firms with the highest scores have clients who are very satisfied with their investment performance and with their individual advisers, he said. These investors also said they will be bringing more money to the firm. Investors also said transparency about portfolio performance and about fees is essential.
“Firms that are able to create a better experience for investors and make it a collaborative relationship have more-satisfied investors,” Mr. Martin said.
The firms with the highest scores also contacted investors more than 12 times over the year, compared with six to eight times a year from the lower-scoring firms, the survey found. In addition to receiving more contact, the most satisfied investors felt like they have a written financial plan that they understand, Mr. Martin said.
RBC Wealth Management returned to the top position this year, a spot it also held in 2011, after falling last year to eighth on the J.D. Power list. RBC scored better this year on the ease of contacting advisers and the timeliness of responding to problems, Mr. Martin said.
Comparing the results with those of a similar survey that the firm conducts on the satisfaction of advisers, Mr. Martin said the same firms typically land near the top of the list, suggesting that happy advisers translate into satisfied clients.
