Cantor Fitzgerald Wealth Partners' CEO, Stan Gregor, talks about his areas of focus at the moment and why he believes being part of a global financial services firm is a boon to the Wealth Partners business.

Last year, the global financial services firm Cantor Fitzgerald upped its game in the wealth management industry by launching Cantor Fitzgerald Wealth Partners.

The unit is led by president and chief executive Stan Gregor, who joined the firm last year from Wells Fargo, where he was a private banking executive.

The move came at a time when the wealth management industry is becoming more popular as firms search for steady fees to offset more volatile investment banking and trading revenues. Indeed, according to the inaugural Fidelity Bank Wealth Management Study, the fee-based nature of wealth management, among other factors, is causing many banks who are “repositioning for growth” to view the sector as a compelling business line. (It is worth noting that the wealth management market is, however, highly competitive.)

Gregor said CFWP is looking to “aggressively” expand through acquisitions of wealth management companies, registered investment advisors and financial advisors.

In February, for example, it acquired Pennsylvania- based First Commonwealth Financial Advisors and then appointed Jeff Schulte and Jim Hiles as financial advisors in New York. More recently, in April the firm linked up with Santa Monica, CA-based Wilshire Funds Management, the global investment management business, and also hired Bob Serhus as chief investment officer. The wealth management business as a whole (including asset management) has made four acquisitions since last September.

Cantor Fitzgerald is over 70 years old and besides its US locations has a strong presence in Europe - with offices in London, Toronto, Dublin, Paris, Nyon and Zurich - as well as branches in Asia-Pacific and the Middle East.

Gregor spoke to Family Wealth Report about his areas of focus at the moment and why he believes being part of a global financial services firm is a boon to the Wealth Partners business.

“The services which the advisors within our wealth management organization have access to are broader than wealth management,” Gregor said.

He added that a number of firms that have been created in the last decade focus exclusively on wealth management, but that business model may prove challenging if they lack the infrastructure to provide certain services that are more institutional in nature, for example. 

The business model is structured as open architecture, where in addition to the internal proprietary solutions offered by Cantor Fitzgerald - an investment bank and brokerage business - CFWP also works with external partners.

“We wanted to make sure the solutions we provide for clients and advisors were some of the best they could have access to, from tech to research,” he said.

As an example of this, he said: “We are constantly searching for who provides the best performance reporting technology out there.

“We are so focused on growth. The partners that we look to attract have to have a mindset that they want to grow. The fact that we are partners as opposed to employees means there is a shared interest globally with the other partners to have new partners be successful.”

Industry change

Gregor said the wealth management industry “has gone through a lot of change” but anticipates even bigger transformations over the next ten years.

“I believe you will see a shift of financial advisors separating themselves from other advisors. The individuals that truly grow their mindset will grow their business organically with their existing client base and they will be managing a much larger portion of that client’s net worth than today,” he said.

“The industry has survived for decades on having a slice of the pie and knowing the client has many slices at other institutions. The smarter advisor of the future is going to find a way to be a trusted advisor…that manages a much larger portion of those clients’ net worth.”

Gregor also touched on the issue of an aging advisor workforce, noting that one of the more notable challenges facing the wealth management industry today relates to a lack of succession planning – a highly talked-about topic at present.

“That affects the firm, the advisor and the client. It’s something that Cantor Fitzgerald is very focused on: how do we create a solution for the advisor, the client and the firm for the go-forward model,” Gregor said.

Meanwhile, it is also worth noting that as the advisor is aging, so too are their clients.

“In the next 20 years we will probably have the largest transfer of wealth the world has ever seen,” Gregor said.

“We are very cognizant that generation that receives that wealth operates in a very different mindset when it comes to relationships. The way that advisors interact with their clients today is expanding into more of a hybrid digital approach,” he added.