Top RIA Custodians 2024

Our 2024 research on RIA custodians in AdvizorPro reveals key market insights, including custodian market share, fastest-growing firms, and preferred custodians among new RIAs. The findings highlight leading players, emerging trends, and popular custodian combinations.
Custodian Market Share Rank


Schwab Leads Across All RIA Sizes

Our market share analysis reveals that Charles Schwab leads across all RIA AUM tiers, from the smallest to RIAs  with over $1 billion in assets.

While Schwab is the front-runner, there are interesting differences in the top players across each tier. 

Our analysis considers the number of clients and advisors, as well as firm size, and shows that newer custodians like Altruist, a tech-focused startup, are gaining traction among smaller RIAs.

 

 

 

Fastest Growing Custodians

 

Altruist is on the Rise

The fastest growing custodians are measured by logo growth, which represents the number of new RIA firms acquired as clients.

The custodians in this list accounted for nearly 70% of all custodial changes or additions made within the one-year period.

As of Q1 2024, Charles Schwab remains at the top, although most of this growth comes from firms transitioning from TD Ameritrade.

If it weren’t for this merger, the numbers would be more in line with the rest of the list you see here. 

A standout on this list is Altruist, a newer, tech-focused custodian on the rise.

Altruist has experienced remarkable growth over the past few years, emerging as a top choice for many new RIAs seeking a custodian partner.

Its popularity surge is a testament to the fact that new RIAs value innovative solutions and exceptional service, making Altruist an attractive option for forward-thinking RIAs.

 

 

 

New RIA Custodian Choices

 

Custodian Preferences of New RIAs

Newly formed RIAs tend to choose Charles Schwab as their custodian, with a 50% or higher likelihood.

This is likely due to the administrative ease of sticking with a familiar custodian, especially when bringing over clients and assets from a previous firm. 

The data suggests that Schwab may continue to grow as new RIAs emerge and existing ones expand.

This trend could be a leading indicator of which custodians will be the biggest players in the future, as the preferences of new RIAs may shape the market share of custodians over time.

 
 
 
SMA Custodian Partnerships

 

Custodian Diversification: A Growing Trend Among RIAs

Most RIAs still only have one custodian, but many RIAs choose to add some diversification to their roster.

With the TD Ameritrade and Schwab merger, some RIAs have added a second custodian, and new families are being brought on board with a different custodian.

This strategy allows RIAs to keep legacy clients on their existing custodian while moving forward with a new one.

While it may be a hassle to repaper, it’s a long-term strategy that custodians are likely to adopt to see the rewards.

As the data shows, the number of RIAs with multiple custodians is significant, and this trend is expected to continue.

 

 

 

Most Common RIA Custodian Rosters

 

Common Custodian Combinations: Schwab’s on top, Altruist Emerges

Over 70% of Registered Investment Advisors (RIAs) have one of the most common custodian combinations, with Schwab being the most popular, followed by combinations with TD Ameritrade.

Interestingly, Altruist is emerging as a popular combination with Schwab, potentially due to the forced migration from TD Ameritrade.

This trend may indicate that RIAs are looking for better servicing and fees, and may eventually migrate to newer custodians.

As the market continues to evolve, it will be interesting to see how these combinations change over time.

 

 

 

TD/Schwab Merger

 

TD Ameritrade to Schwab Transition: A Successful Merger

Analyzing the impact of the TD Ameritrade and Schwab merger reveals a successful transition.

Just over a year ago, 5,500 RIAs still listed TD as their custodian.

Fast-forwarding to today, 80% of those RIAs now list Schwab as their custodian, with 20% still listing TD.

Notably, only 2.3% have completely transitioned away from TD, indicating a significant retention rate for Schwab.

This merger can be considered a big win for Schwab, with 9.7 out of 10 clients retained.

 

 

 

TD Merger

 

Where Did the 2.3% Go? New Custodian Preferences Emerge

Among the 2.3% of RIAs that transitioned away from TD Ameritrade, a new distribution of custodian preferences emerged.

Fidelity saw a significant gain, with many RIAs opting for the Fidelity-Schwab combination.

Altruist took second place, indicating a growing popularity.

Also, Assetmark was recently acquired by Private Equity, which may impact its future growth and influence in the market.