Tags: investor behavior | Schwab | standardization | TD Ameritrade

Investors are placing more money with direct-investment firms such as Fidelity Brokerage Services, The Vanguard Group Inc., Charles Schwab & Co. and TD Ameritrade Inc. Many of these investors also have relationships with financial advisors, who may not know about the outside accounts.

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Assets placed with direct-investment firms rose 19% between 2008 and 2010, compared with a 14% increase in traditional accounts with financial advisors, according to Cerulli Associates Inc.

While the $3.7 trillion total in direct-investment accounts remains far less than the $12.5 trillion in advisor channels, it’s a growing piece of the pie.

The direct-investment firms have widened the range of clients they serve by adding higher-quality financial advice to their services.

“The platforms are becoming more advice-driven," Katherine Wolf, associate director at Cerulli, told InvestmentNews. “And that's where we see the threat to the advisory model.”

That advice tends to be highly standardized, allowing advisors to continue to offer far more personalized advice and services. Even so, some investors who already have advisors want to self-direct a portion of their assets for various reasons.