New Research Reveals Common Characteristics
Of the Fastest Growing Independent Advisory Firms

BOSTON, January 17, 2008 -- Fidelity Investments reported today that registered investment advisor (RIA) firms have realized an average growth rate over the past three years of 55 percent, with more than one-quarter (28 percent) experiencing growth of more than 100 percent, according to a new study.¹

The study, "Fidelity RIA Metrics^SM: Profiles of the Fastest Growing Firms,"² analyzed RIA firms with assets of at least $25 million. It found that the fastest-growing firms -- those that have grown assets at least 100 percent over the past three years -- share a combination of characteristics. These characteristics include an average firm tenure of nine years, average assets under management of $215 million and a greater tendency to be founded by a breakaway broker, among others.

"We're seeing a trend where relatively young firms that broke away from their broker/dealer five to nine years ago and focused on aggressive growth of their asset base appear to have reached a level of critical mass where their assets are virtually doubling every three years," said Gail Graham, executive vice president, Fidelity Institutional Wealth Services. "By identifying the characteristics of the fastest-growing firms, we can help our clients better benchmark their practices against other firms and identify ways to accelerate their own growth."

Factors Enabling Growth: Profile of Firms Growing 100% or More

Fidelity's research reveals there is a common set of characteristics for firms in the highest mode of growth (100 percent and above) versus firms that are experiencing slower growth. For example, the fastest growing firms tend to have more institutional clients, which include 401(k) plans, and are more concerned with scaling their business than slower growing firms.

"While the characteristics identified in our research do not guarantee future growth, they do offer business-building insights to RIA firms, perhaps validating current strategies and suggesting ideas for the future," said Graham. "Our goal is to understand each of our client's distinct characteristics and then work consultatively to ensure we are providing the support and service that help them meet their specific business needs."

Challenges for Large and Small Firms Alike

Overall, all RIAs with total assets of at least $25 million expect to face major challenges in 2008 in running their firms. However, Fidelity's research reveals some notable differences between the challenges for the largest firms (at least $500 million in total assets under management) versus the smallest firms ($25 million to less than $50 million in total assets under management) when it comes to back-office efficiency, profitability and staffing.

•		Efficiency -- Sixty-nine percent of the largest firms cite improving back-office efficiency as a major challenge, compared to 54 percent among smallest firms.
•		Profitability -- Sixty-five percent of the largest firms indicate maintaining margins and profitability as a challenge, compared with 39 percent among smallest firms.
•		Staffing -- While less of a pressing challenge for firms overall, retaining staff was significantly more important to the largest firms (63 percent of whom see it as a challenge for the next two years), compared to 28 percent of the smallest firms.

Advisors and Value of Custodial Support

According to Fidelity's research, all RIAs with at least $25 million in total assets under management express specific needs from their custodian. These needs fall in six areas including Service, Product, Trading, Research & Reporting, Practice Management and Technology.

•		Service -- Beyond the need for "superior customer service," the three most valuable service needs are: Single point of contact (66 percent), direct access to functional experts (54 percent) and dedicated implementation team (51 percent).
•		Product -- The three most valuable product needs across all firms are: Wide range of investment products (65 percent), institutional money market and cash management (53 percent) and retirement income products (26 percent).
•		Trading -- The three most valuable trading needs across all firms are: Advanced trading support (37 percent), dedicated fixed income trading and service desk (37 percent) and access to alternative trading venues (22 percent).
•		Research & Reporting -- The three most valuable research and reporting needs across all firms are: Tax reporting (64 percent), portfolio and performance reporting (59 percent) and tax lot accounting (53 percent).
•		Practice Management -- The three most valuable practice management needs across all firms are: Referrals to customers (54 percent), access to high net worth clients (52 percent) and marketing support (28 percent).
•		Technology Needs -- The three most valuable technology needs across all firms are: Tools that integrate with current technology (59 percent), a proprietary platform that includes all functionalities needed (48 percent) and asset allocation tools (30 percent).

"It's clear that advisory firms look to their custodian for access to the resources and support they need to help them meet business challenges and grow," said Graham. "Our research shows that many of the fastest-growing RIA firms work with Fidelity to help meet their distinct needs. We believe this is indicative of the tremendous investments we are making to build the strongest client experience, our capacity to help them manage their back-office efficiently, and our ability to connect them to the vast resources of Fidelity, among others."

About Fidelity Institutional Wealth Services

Fidelity Institutional Wealth Services is a leading provider of trading, custody and brokerage services to Registered Investment Advisors, Trust Institutions and Third Party Administrators. The company is able to leverage the capital, resources and expertise of the Fidelity organization, one of the world's largest financial services companies, on behalf of its clients. This includes access to a comprehensive set of products and services, innovative investment tools and research, an integrated brokerage and trust platform, and dedicated client service professionals - all designed to help its clients thrive by growing their businesses, more effectively meeting customer needs, and enhancing operational efficiency and profitability. Fidelity Institutional Wealth Services custodies over $346 billion in assets on behalf of more than 4,000 clients, as of November 30, 2007. For more information about Fidelity's services, please visit http://fiws.fidelity.comom.

About Fidelity Investments

Fidelity Investments is one of the world's largest providers of financial services, with custodied assets of $3.4 trillion, including managed assets of $1.6 trillion as of November 30, 2007. Fidelity offers investment management, retirement planning, brokerage, and human resources and benefits outsourcing services to 24 million individuals and institutions as well as through 5,500 financial intermediary firms. The firm is the largest mutual fund company in the United States, the No. 1 provider of workplace retirement savings plans, the largest mutual fund supermarket and a leading online brokerage firm. For more information about Fidelity Investments, visit www.fidelity.com.

¹This does not include 6 percent of all RIA firms that have not grown at all in the past three years.

²The Fidelity survey was conducted on the phone between May 29, 2007 and July 6, 2007 with firm's representative of the RIA Marketplace and received completed responses from 436 RIA firms each with at least $25 million in total assets under management, and not necessarily clients. Data are representative of the RIA marketplace with at least $25 million in total assets under management, with a margin of error of +/-4%. The survey was conducted by Northstar Research Partners (http://www.nsresearch.com), an independent research firm, and did not identify Fidelity as the sponsor.

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Clearing, custody, or other brokerage services may be provided by National Financial Services LLC or Fidelity Brokerage Services LLC, Member NYSE, SIPC.

Northstar Research Partners is an independent company and is not affiliated with Fidelity Investments.