The 2019 Forbes Ranking Of America's Top Women Wealth Advisors: Methodology

By: R.J. Shook | Forbes.com

We’re all about quality.

Forbes' rankings, developed by SHOOK Research, are the only advisor rankings with a focus on quality, including interviewing advisors by telephone and in-person.

Unlike other advisor rankings, SHOOK is not a “robo-ranker.” Numbers such as production and assets don’t tell the whole story, especially when much of the data is self-reported. SHOOK Research creates rankings of role models—advisors that are leading the way in offering best practices and providing a high-quality experience for clients. A focus on both quantitative and qualitative factors, including telephone and in-person meetings, is imperative.

How We Rank

The Forbes ranking of America’s Top Women Wealth Advisors, developed by SHOOK Research, is based on an algorithm of qualitative and quantitative data, rating thousands of wealth advisors with a minimum of seven years of experience and weighing factors like revenue trends, assets under management, compliance records, industry experience and best practices learned through telephone and in-person interviews. Portfolio performance is not a criteria due to varying client objectives and lack of audited data. Neither Forbes or SHOOK receive a fee in exchange for rankings.

Research Summary For All SHOOK Advisors (as of April 2019)

We don't want 200,000 nominations so we set thresholds to minimize the quantity we receive:

• 29,334 nominations received, based on thresholds (7,826 women).
• 10,681 invited to complete online survey.
• 9,341 telephone interviews.
• 1,925 in-person interviews at Advisors’ location.

The SHOOK Process

SHOOK scours the financial services industry—banks, brokerages, custodians, insurance companies, clearing houses and others for nominations. SHOOK accepts advisors who meet pre-determined minimum thresholds and acceptable compliance records. As of this date, SHOOK has received 29,334 nominations—advisors who meet SHOOK’s thresholds. SHOOK invited 10,681 of these nominees to complete an online survey.

Basic Requirements For Top Women Wealth Advisors

• 7 years as an advisor.
• Minimum 1 year at current firm, with exceptions (acquisitions, etc.).
• Advisor must be recommended, and nominated, by Firm.
• Completion of online survey.
• Over 50% of revenue/production must be with individuals.
• Acceptable compliance record.

Quantitative

• Revenue/production; weightings assigned for each.
• Assets under management—and quality of those assets—both custodied and a scrutinized look at assets held away. (Although individual numbers are used for ranking purposes, we publish the entire team's assets.)
• Client-related data, such as retention.
• Portfolio performance is not a factor; audited returns among advisors are rare, and differing client objectives provide varying returns.

Qualitative

• Telephone and in-person meetings with advisors (if an in-person meeting cannot be accomplished, exceptions are considered in which the interview will occur after a ranking has been published).
• Compliance records and u4s. Some “dings” can be overlooked (e.g., firm or product failure beyond the scope of an advisor's due diligence; the older a ding, the less we look). Since there are many gray areas, the SHOOK team is willing to listen to a Firm that is willing to stand behind the advisor with written support from leadership.
• Advisors that provide a full client experience:
  • Service model
  • Investing process
  • Fee structure (higher % of fee-based assets earns more points)
  • Breadth of services, including extensive use of Firm’s platform and resources (e.g., liabilities)
• Credentials (years of service can serve as proxy)
• Use of team and team dynamics
• Community involvement
• Discussions with management, peers, competing peers
• Telephone and in-person meetings

U4/Compliance Issues

The following conditions will be considered in order to lessen weightings infractions:

• Infractions that are denied or closed with no action.
• Complaint arose from a product, service or advice initiated by a previous advisor or another member or former member of team.
• Length of time since complaint.
• Complaints related to product failure not related to investment advice (some limited partnerships, adjusted-rate securities, etc.).
• Complaints that have been settled (must be proven) to appease a client who remained with the advisor for at least one year following settlement date.
• Complaints that are proven to be meritless.
• Actions taken as a result of administrative error or failure by firm.

Once an advisor's compliance rating falls into a tenable category, the following conditions must be met.

1. An advisor's rating must be among SHOOK's highest qualitative measures including in-person interview.
2. Letters of recommendation from firm.

Ranking Algorithm

The algorithm is designed to fairly compare the business practices of a large group of advisors based on quantitative and qualitative elements. Data are weighted to ensure priorities are given to dynamics such as preferred “best practices," business models, recent business activity, etc. Each variable is graded and represents a certain value for each measured component. These data are fed into an algorithm that measures thousands of advisors against each other.

SHOOK Disclosures

SHOOK is completely independent and objective and does not receive compensation from the advisors, Firms, the media, or any other source in exchange for placement on a ranking. SHOOK is funded through conferences, publications and research partners. Since every investor has unique needs, investors must carefully choose the right Advisor for their own situation and perform their own due diligence. SHOOK’s research and rankings provide opinions for how to choose the right Financial Advisor. Portfolio performance is not a criterion due to varying client objectives and lack of audited data. Remember, past performance is not an indication of future results.

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