Investor Optimism Weakened; Hunger for Investment Advice on the Rise at Charles Schwab

Wednesday, February 1, 2012 8:30 am PST



Public Company Information:

"In so many ways, Schwab is now in a category of its own, providing robust advice at a fair value through our own financial consultants as well as through the many thousands of registered investment advisors we support through Schwab Advisor Services"

SAN FRANCISCO--(BUSINESS WIRE)--According to a just-released survey of Charles Schwab individual investor clients, just 26 percent feel better off financially than they did one year ago, down from 44 percent who said they felt better off in Q4 2010. Additionally, just one-third (33 percent) of these investors now say they feel confident in their ability to make investment decisions.

Amid this downbeat sentiment, newly enrolled accounts in the company’s advisory programs grew by 10 percent in 2011, and net assets in these fee-based solutions increased by 33 percent last year. According to the survey, 77 percent of Schwab clients say they’re most confident when receiving ongoing or periodic professional investment advice.

“Our approach to full-service, with solutions for everyone from active traders and do-it-yourselfers to those who want periodic advice and guidance or ongoing professional investment management, resonates with today’s investors,” said Walt Bettinger, Charles Schwab president and chief executive officer.

“In so many ways, Schwab is now in a category of its own, providing robust advice at a fair value through our own financial consultants as well as through the many thousands of registered investment advisors we support through Schwab Advisor Services,” said Bettinger.

Schwab’s suite of advisory programs, which added on average more than $1.5 billion in new assets each month of 2011 to end the year at $109 billion in total, provides clients with ongoing investment support and portfolio solutions. These include:

  • Schwab Advisor Network® – A referral to a local independent investment advisor who can take over day-to-day investment management for investors with more complex financial situations and specialized planning needs.
  • Schwab Private Client™ – An ongoing private client relationship with dedicated representatives at Schwab and non-discretionary advice provided by Schwab Private Client Investment Advisory, Inc.
  • Windhaven Portfolios™ – Globally diversified portfolios composed primarily of low-cost index exchange-traded funds (ETFs), dynamically managed by Windhaven Investment Management™ and provided through Schwab.
  • Schwab Managed Portfolios™ – Diversified portfolios of either mutual funds or ETFs designed for a range of investment strategies and managed by Charles Schwab Investment Advisory, Inc.
  • Managed Account Services – Specialized investment strategies for part or all of a portfolio, managed by professional asset managers.

“Questions from clients about the market, their portfolios, and what the market environment means for them have been accelerating throughout the year, so naturally, the length and the depth of conversations we’re having with our clients are also on the rise,” said Bettinger. “Clients really appreciate the ability to call the shots when it comes to when, how and how much they need our guidance.”

Bettinger underscored that Schwab also delivered more than 28,000 complimentary consultations and helped more than 12,000 retail clients with financial plans in 2011. Last year, financial consultants at Schwab had more than 493,000 face-to-face interactions with retail investors; more than 107,000 investors attended nearly 11,000 in-person events hosted by Schwab branches he said.

Describing additional results of the investor survey, Bettinger noted that Schwab retail clients continue to prefer investing potential new assets (62 percent) over saving (29 percent), paying off debt (29 percent) or spending (13 percent). Only 20 percent of clients moved assets into cash in Q4 and even fewer (13 percent) say they moved to the sidelines in response to recent market volatility.

About Charles Schwab

The Charles Schwab Corporation (NYSE:SCHW) is a leading provider of financial services, with more than 300 offices and 8.6 million client brokerage accounts, 1.49 million corporate retirement plan participants, 780,000 banking accounts, and $1.68 trillion in client assets as of December 31, 2011. Through its operating subsidiaries, the company provides a full range of securities brokerage, banking, money management and financial advisory services to individual investors and independent investment advisors. Its broker-dealer subsidiary, Charles Schwab & Co., Inc. (member SIPC,, and affiliates offer a complete range of investment services and products including an extensive selection of mutual funds; financial planning and investment advice; retirement plan and equity compensation plan services; referrals to independent fee-based investment advisors; and custodial, operational and trading support for independent, fee-based investment advisors through Schwab Advisor Services. Its banking subsidiary, Charles Schwab Bank (member FDIC and an Equal Housing Lender), provides banking and mortgage services and products. More information is available at and (0212-0800)

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Independent investment advisors are not owned by, affiliated with or supervised by Charles Schwab & Co., Inc.

*The Schwab Survey of Investor Confidence was conducted in December 2011 and aggregates the views of more than 1055 retail clients. Online interviews were conducted December 1-13, 2011 by global market research firm Synovate, which is not affiliated with Schwab. (0112-0811)

Diversification strategies do not assure a profit and do not protect against losses in declining markets.

Investments in managed accounts should be considered in view of a larger, more diversified investment portfolio.

Please read Schwab’s Disclosure Brochure for important information, pricing and disclosures relating to Schwab Managed Portfolios and Schwab Managed Account Services.

Please read the Schwab Private Client and the Schwab Private Client Investment Advisory, Inc. Disclosure Brochures for important information and disclosures about this service.

Windhaven Diversified Portfolios strategies are available through Schwab’s Managed Account Connection™ program (“Connection”). Please refer to Windhaven’s Form ADV Part 2 for more information.

SAN Network member advisors are independent and are not employees or agents of Charles Schwab & Co., Inc. ("Schwab"). Schwab prescreens advisors and checks their experience and credentials against criteria Schwab sets, such as years of experience managing investments, amount of assets managed, professional education, regulatory licensing, and business relationship as a client of Schwab. Advisors pay fees to Schwab in connection with referrals. Schwab does not supervise advisors and does not prepare, verify or endorse information distributed by advisors. Investors must decide whether to hire an advisor and what authority to give him or her. Investors, not Schwab, are responsible for monitoring and evaluating an advisor's service, performance and account transactions. Services may vary depending on which advisor an investor chooses.

Schwab Private Client Investment Advisory, Inc., Windhaven Investment Management, Inc., and Charles Schwab Investment Advisory, Inc. are registered investment advisors wholly owned by The Charles Schwab Corporation.


Charles Schwab
Michael Cianfrocca, 415-667-0344
Pablo Rodriguez, 415-486-3267

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