Janney Montgomery Scott is a dually registered investment advisor and broker-dealer. The firm offers portfolio management, financial planning, retirement plan consulting and consulting services, and it can also process investment trades for clients. Janney Montgomery Scott is owned by The Penn Mutual Life Insurance Company, so its advisors also have access to life insurance products. Headquartered in Philadelphia, the firm has over 1,100 advisors spread up and down the East Coast.
The bottom line: Janney Montgomery Scott is an investment advisor and broker-dealer with a wide range of investment programs and financial planning offerings.
|Assets under management (AUM): $62,029,497,716|
|Minimum investment: Varies by program, starting at $5,000|
|Individual investor to advisor ratio: 148:1|
|Fee structure: A percentage of AUM, fixed fees, commissions, other (fee plus commission)|
|Headquarters: 1717 Arch Street
Philadelphia, PA 19103
Phone: (215) 665-6000
All information included in this profile is accurate as of September 10, 2021. For more information, please consult Janney Montgomery Scott’s website.
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Janney Montgomery Scott launched in 1832 as a broker-dealer. The company once held the second-oldest seat on the New York Stock Exchange. In 1982, The Penn Mutual Life Insurance Company purchased Janney Montgomery Scott, which now operates as a wholly owned independent subsidiary of Penn Mutual.
Janney Montgomery Scott has over 2,000 employers, more than 1,100 of whom serve in investment advisory and research roles. Meanwhile, nearly 1,600 work as registered representatives for the company’s broker-dealer service. Additionally, nearly 1,000 of the firm’s employees are licensed to sell insurance.
Individuals make up the vast majority of Janney Montgomery Scott’s clients. The firm works with both non-high net worth and high net worth individuals, with high net worth being individuals defined by the SEC as those who invest at least $750,000 with an advisor or have a total net worth over $1.5 million.
The minimum initial investment to work with Janney Montgomery Scott depends on the program. The lowest program starts at $5,000 while the highest program minimum is $150,000.
Janney Montgomery Scott primarily offers investment advisory and brokerage services. The firm offers numerous investment programs, including wrap fee programs where all investment costs are covered under one flat fee, partnerships with third-party managers and goal-based portfolio solutions. The advisors at Janney Montgomery Scott can work with clients on a discretionary basis, where they can make trades for a client without their permission each time, and on a non-discretionary basis, where a client must approve each trade.
Janney Montgomery Scott also offers financial planning. This service can be offered as either a lead-in to investment management services or to give clients a plan they can manage themselves.
In addition, Janney Montgomery Scott operates as a broker-dealer, so it can process investment trades directly for its clients and provide investment research. Some of the company’s advisors are also insurance agents so they can sell insurance products, including those from the firm’s parent company, Penn Mutual. Last, Janney Montgomery Scott provides retirement plan advisory services and consulting.
Here is a complete list of services offered by the firm:
Janney Montgomery Scott does not have an underlying investment philosophy itself, but rather invests to meet the individual goals of each client. The firm does not offer pre-designed funds and instead customizes its investment recommendations to each client. When a new client meets with an advisor, the advisor will get to know the client’s goals, challenges and financial attitudes to design a plan.
Advisors could build client portfolios using funds from Janney Montgomery Scott as well as outside third-party advisors.The firm’s brochure notes that it has access to 6,000 potential investment strategies from Morningstar, offering clients a wide range to choose from. The firm could also use mutual funds, exchange-traded funds (ETFs), alternative investments, stocks and bonds.
Janney Montgomery Scott offers multiple investment programs, split across three main categories. Here’s an overview of the three categories and their strategies:
|Janney Montgomery Scott Investment Program Categories|
|Professional Money Management||A professional advisor designs and manages your investment portfolio, using stocks, bonds, mutual funds, ETFs and/or strategies from outside advisors; could also partner with an outside advisor you’re already working with.||$100,000 to $150,000|
|Asset Allocation||These programs invest your money into pre-designed funds with specific strategies, like Equity Growth or Diversified Income.||$5,000 to $25,000|
|Internal Portfolio Management||These programs are less hands-on and geared toward clients with investment knowledge, like a non-discretionary program where you need to approve trades and a program for employees working at other financial firms.||$10,000 to $50,000|
Janney Montgomery Scott primarily charges clients based on a percentage of assets under the firm’s management, which is deducted from a client’s portfolio each year. The firm lists its maximum annual fee could be 2% a year, but does not list any breakpoints based on portfolio size. Janney Montgomery Scott does note that its fees are negotiable and are something that you would discuss with your advisor upon joining. If you end up working with a third-party advisor as part of your portfolio, you could owe an additional sub-advisory fee on top of the advisory fee you pay to Janney Montgomery Scott.
Most of the Janney Montgomery Scott advisory programs are wrap fee programs. This means you pay one asset-based fee, which also covers other standard investment costs like trade execution commissions, custody fees and reporting. Depending on how you set up the account, you could be responsible for some additional fees, like for using a third-party custodian, but most are covered by the wrap fee. Clients can also join a non-wrap fee program, which means they would pay extra for these investment costs on top of the investment advisory fee.
For other services like standalone financial planning and retirement plan consulting, Janney Montgomery Scott could charge one-time project fees as well as annual flat or asset-based fees for ongoing engagements.
Janney Montgomery Scott reports a number of disciplinary disclosures. As a registered investment advisor, the company is required to report on its Form ADV filed with the SEC any criminal, regulatory or civil events involving the firm, its employees or its affiliates that have occurred within the last 10 years.
Janney Montgomery Scott’s disclosures are generally all related to regulatory issues, such as allegations that it did not have the right reporting systems or failed to give the proper trading discounts, or issues with former employees. In nearly all cases, the firm paid a fine without admitting wrongdoing or self-reported the issue.
Here are the disclosures the firm has recorded within the last decade:
For more information on the firm and further details on its disclosures, visit Janny Montgomery Scott’s IAPD page.
Janney Montgomery Scott has over 100 offices throughout the U.S. In its Form ADV, it lists locations in the following 12 states and the District of Columbia:
If you are looking for general investment advisory services, Janney Montgomery Scott offers plenty of options to choose from. The firm could be particularly attractive for those with smaller portfolios because you can access their services for as little as $5,000 whereas other investment advisors can require much larger investment minimums.
On the other hand, if you are looking for specialized advice, like an advisor who focuses on divorce or advice for doctors, Janney Montgomery Scott does not offer these specialties as it is more of a general investment firm. The firm’s maximum fee is also on the high side. While its rates are negotiable, bigger investors may qualify for a better rate at other advisors with clearer rate breakpoints.
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