FAJ | December 2025
The global financial landscape is undergoing a significant transformation, driven by two interconnected trends: the growth of ETFs and the parallel spread of advanced advisory models, based on a fee-based approach to financial advisors.
Some findings emerge from FINER’s periodic studies of financial advisors. The first relates to the importance of having ETFs in clients’ portfolios, which has grown by 34% in four years. The second finding is that in 93% of cases, ETFs are included in advanced advisory tools.
Far from being a coincidence, this correlation is the result of a structural change that focuses on transparency, cost efficiency, and the alignment of interests between advisors and clients.
The main point of convergence between the two phenomena lies in their shared philosophy: the pursuit of transparency and efficiency.
Thanks to their passive structure, ETFs do not require excessively expensive management, resulting in significantly lower management fees than traditional mutual funds. This cost efficiency translates directly into higher net returns for the investor.
The most advanced advisory models provide for the advisor to be compensated through a fee paid directly by the client, without receiving rebates or commissions from the financial products recommended. This eliminates the potential conflicts of interest inherent in traditional models, where the advisor could be incentivized to recommend more expensive products to obtain higher commissions.
This is a perfect fit; the synergy between ETFs and fee-based advisory is evident for several reasons.
First, it eliminates conflicts of interest; the advisor, having no ties to fund management companies, is free to select the most efficient and cost-effective instruments available on the market, which are often ETFs. The advisor’s goal becomes to maximize the client’s net return, and the client, in exchange for quality advice, will be able to appreciate it literally.
Second, it enhances the advisor’s role, which no longer stems from the selection of a single product, but from their real expertise, which can be summarized in three aspects: 1) planning, helping the client define long-term goals; 2) emotional management, helping the client stay on track during market fluctuations, avoiding impulsive decisions; 3) efficient portfolio construction and rebalancing, the ease of trading of ETFs simplifies these operations.
Clients are increasingly informed and eager to understand how much they’re paying and for what. The fee-based model, combined with transparent instruments like ETFs, meets this growing demand for clarity.
The growth of ETFs and the expansion of fee-based financial advisory are two sides of the same coin: a financial industry moving toward greater efficiency, transparency, and close alignment with client interests. Advisors who have seized on this trend, adopting an advanced fee-based advisory approach and integrating ETFs into their portfolios, are uniquely positioned to meet the needs of the modern market and build a relationship of trust.
And it is precisely on trust that the future of financial advisory, which is currently experiencing a second revolution, will hinge.Nicola Ronchetti