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Wedbush Securities Review

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Wedbush Securities Inc.

An investment advisor firm, brokerage and investment bank, Wedbush Securities is a one-stop financial shop. It can even help you with your personal banking needs.

Headquartered in Los Angeles, California, the firm has 12 more offices in California and 12 more scattered from Honolulu, Hawaii to Traverse City, Michigan - plus more than 100 correspondent offices. Its roots go back to 1955, and until 2018, one of its cofounders, Edward Wedbush, still led the firm. Currently, one of his sons serves as co-president and another as chairman. Wedbush Securities employs 800 people, including 150 advisors, and manages more than $2.1 billion in assets. 

Wedbush Securities Background

With $5,000, Edward Wedbush and Robert Werner founded Wedbush & Company as a mutual fund brokerage in 1955. It has since grown (and changed names) into a full-service financial firm.

Even though Wedbush Securities has been around for decades, it’s also been at the forefront of cryptocurrency banking. In 2014, it became the first U.S. financial institution to accept Bitcoin payments. 

Recently, however, the firm has run into some headwinds, including from the U.S. Securities and Exchange Commission (SEC). Indeed, the Los Angeles Times described the company that’s been accused of a number of irregularities as “troubled.” In May 2018, co-founder Wedbush stepped down, and his son Gary Wedbush and Richard Jablonski took over as co-presidents. Edward Wedbush remains chairman of parent company Wedbush Inc.

What Types of Clients Does Wedbush Securities Accept?

The asset management division works with institutional and private investors. The latter category includes individuals who are and aren’t high-net-worth individuals.

Wedbush Securities Minimum Account Sizes

To open an investment management account, the minimum is typically $100,000, though an advisor may request that an exception be made. For discretionary accounts on the independent contractor platform, the minimum is $25,000, and for Strategic Advisory accounts (a wrap-fee program that invests only in mutual funds and exchange-traded funds), the minimum is $10,000.

Services Offered by Wedbush Securities

As mentioned earlier, Wedbush Securities is a full-service financial firm. Within its wealth management division, it offers financial planning, investment solutions, retirement planning and lending and checking bank solutions. Advisors can offer guidance on such investments as mutual funds, exchange-traded funds (ETFs), unit investment trusts (UITs), stocks, bonds and alternative investments - plus annuities and other insurance products.

Additionally, Wedbush Securities offers four different wrap fee programs (where most, but possibly not all, transaction and management costs are bundled into one fee): 

  1. Managed Account Program 
  2. Discretionary Advisory Account Program 
  3. Non-Discretionary Advisory Account Program 
  4. Strategist Advisory Account Program 

In turn, each program has different kinds of accounts:

1. Managed Account Program  

  • Managed Model Account (MMA)  
  • Separately Managed Account (SMA)  
  • Unified Managed Account (UMA)  
  • Independent Manager Account (IMA)  
  • Other Wrap Program Arrangements 

2. Discretionary Advisory Account Program  

  • Discretionary Managed Assets (DMA)  
  • Discretionary Managed Account – Independent Contractor (DMI-IC) 

3. Non-Discretionary Advisory Account Program  

  • Self-Directed Investment Advisory Account (SDI)  
  • Self-Directed Investment Advisory Account – Independent Contractor (SDI-IC) 

4. Strategist Advisory Account Program (MF/ETF)  

  • Portfolios constructed of mutual funds and/or ETFs provided by independent or affiliated advisor firms

Wedbush Securities Investing Philosophy

Investing strategies and methods of analysis depend on the financial advisor, but generally, the former category includes both long-term and short-term purchases of securities. 

Fees Under Wedbush Securities

Wedbush Securities bases its investment advisory fees on a percentage of client assets under management. The firm may negotiate the fee, but generally the wrap-fee programs follow this fee schedule (except for the Strategist Advisory Account Program):

Account Size  Annualized Overall Fees (% of assets)
Up to $250,000  3.00% 
$250,001 to $500,000  2.80% 
$500,001 to $1,000,000 2.50% 
$1,000,001 to $3,000,000 1.90% 
$3,000,001 to $5,000,000  1.60% 
$5,000,001 and above Negotiable 

For the Strategist Advisory Account Program, which has a lower minimum requirement, the fee schedule is:

Account Size Annualized Overall Fees (% of assets) 
$10,000 to $25,000 2.50%
$25,001 to $50,000 2.00% 
$50,001 and above Negotiable 

Wedbush Securities Awards and Recognition

Working in the financial services industry for over half a century, Edward Wedbush has racked up quite a number of awards and distinctions. They include: 

  • Ernst & Young’s Entrepreneurship of the Year for Greater Los Angeles, 2006
  • Los Angeles Business Journal- 100 Top Executives 2010
  • Chairman, Board of Directors of the Pacific Exchange
  • Director, National Securities Clearing Corp
  • Member of the American Stock Exchange Advisory Board
  • Chairman of the NYSE Regional Firms Advisory Committee to the Board of Directors
  • Member of the Board of Directors – Securities Industry Association

Additionally, the firm often appears on top lists for stock picking. Recently, the 2019 StarMine Analyst Awards named members of Wedbush Securities’ equity research team as No. 1 top earning estimators (in the overall analyst award category), No. 1 in thrifts & mortgage finance (in the industry analyst award category), No. 1 in software (in the industry analyst award category), No. 1 in entertainment (in the industry analyst award category), No. 1 in banks (in the industry analyst award category) and No. 3 in hotel and leisure (in the industry analyst award category).

What to Watch Out For

As a broker dealer, Wedbush Securities receives shareholder distribution fees from mutual fund companies that charge 12b-1 fees (named for Rule 12b-1 of the Investment Company Act of 1940). This could present a conflict of interest, as advisors have a financial incentive to recommend to clients funds that charge higher 12b-1 fees (which are assessed as a percentage of assets). That said, Wedbush Securities says it rebates these fees to clients who are being charged an advisory fee, so if you may be affected, make sure your account is being credited for these 12b-1 fees.

Additionally, depending on how frequently your account has transactions, you may be better off paying for each trade rather than participating in a wrap fee program. Before signing onto a wrap fee program, ask your advisor, who, as a fiduciary, must put your interests first, if the wrap fee program is really right for you. 

Also, while the firm’s financial advisors are fee-based, some may also be insurance agents or broker representatives who receive commissions in their separate capacities.

Disclosures

Wedbush Securities has resolved 71 actions brought against it (alone or with an affiliate) by regulatory authorities in the past 10 years (from January 2009 to December 2018). It has paid a total of $14,462,134.20 in fines and was censured 58 times. The largest fine was $2,447,043.38 for an action brought by the SEC, in which it alleged that the firm, among other things, did not provide oversight of sponsored access trading platforms that met regulatory requirements, failed to file reports of suspicious trading activity in connection with its market access business and allowed sponsored access clients to submit short-sale orders for securities that were not easy to borrow without first otherwise locating shares to borrow.

Opening an Account With Wedbush Securities

To contact Wedbush Securities, call (213) 688-8000 or send a direct message via its contact-us page: https://www.wedbush.com/contact-us/.

Where Is Wedbush Securities Located?

The address for Wedbush Securities headquarters is 1000 Wilshire Boulevard, Los Angeles, California 90017.

All information was accurate as of the writing of this article. 

Tips for Finding a Financial Advisor 

  • Begin by asking friends, family and colleagues for their financial advisor. After all, you need an advisor you can trust, and a recommendation from someone you know is a good start.
  • Widen your search using SmartAsset’s financial advisor matching tool. Simply answer questions about your financial situation and preferences, and the program will match you with up to three suitable advisors, whom we screened for any disciplinary actions by regulatory authorities.
  • Interview prospective advisors. In addition to basics about investment strategy and fees, you want to get a sense of them as people. Do you like them? Can you picture having intimate conversations with them? Because few topics are more personal than your money, and your relationship will be based on it.

How Many Years $1 Million Lasts in Retirement

SmartAsset's interactive map highlights places where $1 million will last the longest in retirement. Zoom between states and the national map to see the top spots in each region. Also, scroll over any city to learn about cost of living in retirement there.

Least
Most
Rank City Housing Expenses Food Expenses Healthcare Expenses Utilities Expenses Transportation Expenses

Methodology SmartAsset calculated the average cost of living for retirees in the largest U.S. cities. Using that calculation, we determined how many years $1 million would last in retirement in each major city.

First, we looked at data from the Bureau of Labor Statistics (BLS) on the average annual expenditures of seniors throughout the country. We then applied cost of living data from the Council for Community and Economic Research to adjust those national average spending levels based on the costs of each expense category (housing, food, healthcare, utilities, transportation and other) in each city.

We assumed the $1 million would grow at a real return (interest minus inflation) of 2%, reflecting the typical return on a conservative investment portfolio. Finally, we divided $1 million by the sum of each of those annual numbers to determine how long $1 million would last in each of the cities in our study.

Sources: Bureau of Labor Statistics (BLS), Council for Community and Economic Research