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TD Ameritrade Institutional2020 RIA Sentiment SurveyJanuary 7, 2020This material is designed for an investment professional audience, primarily Registered Investment Advisors (RIAs).TD Ameritrade Institutional, Division of TD Ameritrade, Inc., member FINRA/SIPC. TD Ameritrade is a trademark jointlyowned by TD Ameritrade IP Company, Inc. and The Toronto-Dominion Bank. 2020 TD Ameritrade IP Company, Inc.

Executive summaryAdvisor optimism is at all-time highs 50% of RIAs are optimistic about the US economy, 18% are very optimistic 58% are optimistic in their global economic outlook Advisors say economy, earnings and trade headlines will impact client portfolios They expect IT, health care and financials sectors to outperform in 20202019 brought growth and change for RIAs Clients, revenues and AUM increased, with more of the same expected in 2020 Most new clients came from national brokerages or were self-directed RIAs had their biggest increase in spending on tech in 2019 Client interest in stakeholder-driven and ‘grass-roots’ investing is high Advisors are delegating more investment management to third parties 0 commissions on ETF trading is not an automatic deal-maker, say RIAs

Executive summaryIn 2020, RIAs will combine tech and traditional tactics to attract new clients In 2020, their marketing spend will get the biggest boost Top marketing picks: referrals, social media / online engagement and events Performance reporting & CRM tied for the #1 tech investment in 2020 Newer tech – video conferencing & texting - is helping to foster relationships RIAs spend more time with their clients than 5 years ago, largely discussingthings other than investmentsRIAs are keeping an eye on M&A for now, trend-watching Most expect M&A to accelerate, but they have no immediate plans to sell Though many have been approached about a deal, roughly a third are simplynot interested in M&A yet.

MethodologyResults for the TD Ameritrade Institutional 2020 RIASentiment Survey are based on an email survey,conducted by MaritzCX on behalf of TD AmeritradeInstitutional, a division of TD Ameritrade, Inc.,between Nov. 22 and Dec. 1, 2019.301 independent registered investment advisors(RIAs) participated in this study. Participants, bothclients of TD Ameritrade Institutional and nonclients, were asked to share their views on economy,the outlook for their firms and the RIA marketoverall. The margin of error is 5.6%MaritzCX and TD Ameritrade are separate and notaffiliated and not responsible for each other’sservices or policies.

RIA Outlookfor 2020

RIAs have a bright outlookon the U.S. economyRIA Outlook for U.S. Economy0%2020201913%2%12%Very pessimistic20%50%24%Somewhat pessimistic18%All-Time High51%NeutralSomewhat optimistic11%Very optimisticQ4. N 301. Again looking ahead to the next six months, what is your outlook for the U.S. economy through the first half of 2020? (ONE RESPONSE)

Overall optimism is as high as everTrend in RIA U.S. Economic OutlookVery sticVery 1%201623%23%8%1%20177%0%2018Q4. N 301. Again looking ahead to the next six months, what is your outlook for the U.S. economy through the first half of 2020? (ONE RESPONSE)12%2%201920%13%0%2020

Even the global economicoutlook looks brighter, say RIAsRIA Outlook for Global Economy20201%20192%13%14%Very pessimistic20%50%36%Somewhat pessimistic15%41%NeutralSomewhat optimistic6%Very optimisticQ3. N 301. Looking ahead to the next six months, what is your outlook for the global economy through the first half of 2020? (ONE RESPONSE)

Economy, earnings and trade headlinesimpact investments the mostTop 2020 Headlines Impacting Client Portfolios68%U.S. economy66%Corporate earnings65%Trade tensions54%U.S. presidential elections53%Global economy45%Geopolitical tensions44%Interest ratesEnergy prices19%Q7. N 301. Which of the following headlines are you watching for their potential impact on your clients' portfolios? (CHOOSE ALL THAT APPLY)

RIAs say IT, health care and financialswill outperform in 2020Top Performing Sectors in 2020ITHealth Care42%28% Consumer Staples23% Energy22% Communications ServicesFinancials40%20% Consumer Discretionary18% Utilities13% TelecomsQ8a. N 301. Which of the sectors do you expect to outperform in 2020 (ACCEPT 3- RESPONSES)34%10% Industrials7% Materials

Investing

Advisors say clients lean towardESG, cannabis investmentsClient Interest in Asset CategoriesInterestedNot interestedSocially responsible or ESG investments44%50%50%Pot- or cannabis-related stocksPrivate investments (i.e., private equity, venturecapital)38%35%Alternative strategies (i.e., hedge funds)Participation in IPOs32%Physical 3%Q11b. N 301. Please characterize your clients’ overall level of interest in the following asset categories. (SELECT ONE)62%65%68%68%79%87%

0 ETF commissions are nice,but not always neededImportance of 0 ETF Commissions in Investment Allocation 0 ETF commissions will not influence mydecision to use ETFs versus MFs64%32%I will allocate more assets to ETFsI will move money out ofmutual funds and into ETFsI will allocate more assetsto mutual fundsI will move money out ofETFs and into mutual funds14%2%0%Q68. N 301. Now that ETFs trade with 0 commissions nearly everywhere, how will your allocation of client assets to ETFs andmutual funds change in? (SELECT ALL THAT APPLY)

Momentum for investmentoutsourcing is buildingRIA Usage of Third-Party Investment ManagersNo71%Yes29%2020201981%14%4%1%Do it all in-houseUse an investment managerUse a TAMPUse a robo12%9%6%2%Yes, I use model portfoliosYes, an investment managerYes, TAMPYes, a robo-advisor201890%6%4%0%Q12. N 301. Does your firm delegate investment selection to a third party? (ONE RESPONSE)Do it all in-houseUse an investment managerUse a TAMPUse a robo

FirmGrowth

RIA enjoyed positive gains in 20192019 New Client GrowthRevenue Growth21%25%4%4%71%IncreasedDecreasedRemained about the sameAverage Increase:12%75%IncreasedDecreasedRemained about the sameAverage Increase: 14%Q15. N 301. Has the total number of clients served by your firm decreased, increased or remained about the same over the past six months? (ONE RESPONSE)Q16. N 188. By approximately what percentage has your firm’s client base grown?Q21. N 301. Over the past six months, has your firm’s revenue decreased, increased or remained about the same? (ONE RESPONSE)Q22. N 190. By approximately what percentage has your firm’s revenue grown?

RIAs are on track for more growthin 20202019 AUM Growth4%2020 AUM Outlook14%23%41%2%82%IncreasedDecreasedRemained about the same34%Faster growth rateSlower growth rateDeclineRemain about the sameAverage Increase: 16%Q18. N 301. Have your firm’s total assets under management decreased, increased, or remained about the same over the past six months? (ONERESPONSE)Q19. N 212. By approximately what percentage has your firm’s AUM grown?Q25. N 301. In 2020, what is your outlook for your firm’s assets under management relative to 2019?

Nearly a third of newclients left brokers for RIAsNational / Wirehousebrokerages26%Self-directed investors orclient new to ces ofNew ClientsM&A or newadvisor/partneronboarding1%Banks2%Clients fromCommissionedBrokers: 33%Other25%Independentbroker-dealers7%Other RIAs9%Q24. N 301. Over the past year, from where did the majority of your firm’s new client assets come? (ONE RESPONSE)

RIAs marry hi-tech with hi-touchto woo clients in 2020Top Marketing Initiatives for 2020Social media 32%Asking clients forreferrals 63%Upgrade onlinepresence 32%Podcast 4%Print or broadcastadvertising 5%Sponsorships 6%Seminars andevents 28%Getting quoted in orappearing in the press8%Firm rebranding 10%Direct mail or email 12%Q32b. N 301. What are your top marketing initiatives in 2020? (SELECT 3)Sharing curated and originalcontent 15%

RIA spend more on their biggestchallengesBiggest Spending Increases in 2019MarketingLegal/Compliance2020 Expected Spending y14%23%Marketing38%26%Biggest RIA Management ceQ33. N 301. In 2019, where did your firm realize the biggest increase in spending? (ONE RESPONSE)Q13. N 301. Which of following is your biggest firm management or operational challenges? Please select up to 3.Q35. In 2020, where do you expect your firm will realize the biggest increase in spending? (ONE RESPONSE)48%

Spotlight on:Technology

RIAs spending 2020 tech dollars onperformance reporting & CRM toolsTop RIA Tech Investments in 2020Performance reportingCRM tools43%36% Financial planning31% Client portal29% Social media toolsCybersecurity43%23% Digital doc/eSignature17% Rebalancing software9% AI-enabled devices/appsQ39a. N 301. Where are you making significant technology investments in 2020? (SELECT ALL THAT APPLY)4% Robo-advice solutions37%

RIAs are embracing video-conferencingand secure textingRIA Usage of Newer Tech Tools in Client CommunicationCurrently do 2%Exploring for 202036%11%Not 7%90%Augmented reality or virtual reality toolsPersonalized videosAI-enabled applications or devicesVideoconferencingYouTube ChannelRobo-assistants for the front officeSecure textingPodcastsFlash briefingsQ60. N 301. For each of the following, indicate whether this is something your firm currently does, is exploring for 2020 or is not yetconsidering2%100%

RIAs have upped the ante onclient communications47%of advisors’ time with clients is spent talking about topics otherthan investment management53%of RIAs spend at least 50% or more of theirtime with clients talking about “other things”Time Spent on Client Communications vs 5 Years Ago23% - more71% - about the same6% - lessQ63. N 301. What percentage of your time with clients is spent talking about topics and issues other than those related to investment management?Q64. N 301. Is this amount of time more or less than five years ago?

RIAs say M&A is accelerating, but notall are ready to make a moveWhat’s your outlook for the pace of M&Ain the RIA industry for 2020?23%11%18%Decrease3%Stay t interested at allAre you contemplating selling your firm in the next two years(2020-2021)?10%Have you been approached by a potential acquirer in 2019 (i.e.,another RIA, aggregator firms, private equity)?Yes91%45%55%NoQ37a. N 301. Using a scale of 1-5 where 1 is not interested at all and 5 is extremely interested, how interested are you in considering M&A asa potential growth strategy? (SELECT ONE)

Aboutthe survey

herLatino orHispanic2%1%Asian/PacificIslanders1%2%Caucasian (non-Hispanic)94%13%Female87%EthnicityAverage age:57MaleJob titleCFP/Financial PlannerChief Investment OfficerRegistered Investment Advisor (RIA), Investment AdvisorFinancial Advisor, Investment Manager, PortfolioVice PresidentOwner, President, CEO, Partner, Principal3%3%4%1%Average total assetsunder management: 143M13%76%