Rainmaker

AAA

DEFINITION of 'Rainmaker'

A broker or financial advisor who brings a large number of wealthy clients to the firm he or she works for. Rainmakers are skilled at expanding their client base and increasing their assets under management. As such, they are typically highly compensated. Also, because of their proven ability to generate revenue for one firm, they may be heavily recruited by competing firms and offered significant financial incentives to make the switch.

BREAKING DOWN 'Rainmaker'

If a rainmaker leaves a firm and takes his or her clients, the firm can suffer a significant loss of future revenue, as well as the loss of reputation that comes with losing a well known broker/advisor. Rainmakers often have teams of brokers or advisers who work under them, and these teams may be part of a package deal when a rainmaker changes firms, which adds to their former firm's losses.

RELATED TERMS
  1. Investment Bank - IB

    A financial intermediary that performs a variety of services. ...
  2. Raintaker

    A former employee of a brokerage firm who takes high-value clientelle ...
  3. Cold Calling

    The solicitation of potential customers who were not anticipating ...
  4. Front Running

    The unethical practice of a broker trading an equity based on ...
  5. Broker

    1. An individual or firm that charges a fee or commission for ...
  6. Investment

    An asset or item that is purchased with the hope that it will ...
Related Articles
  1. Investing Basics

    Analyst Recommendations: Do Sell Ratings Exist?

    Analyst reports can be an investor's best friend - but without knowing how to read them, you won't be able to fully utilize them.
  2. Brokers

    Brokerage Functions: Underwriting And Agency Roles

    Learning about these various activities can give insight into how securities are issued and traded.
  3. Professionals

    Becoming A Financial Analyst

    A career as a financial analyst requires preparation and hard work, but the payoff can be especially rewarding.
  4. Options & Futures

    Don't Let Brokerage Fees Undermine Your Returns

    Smart investors don't give away more money than necessary in commissions and fees. Find out how to save.
  5. Options & Futures

    10 Tips For Choosing An Online Broker

    This important investment decision happens before you pick your first stock. Find out how to get it right.
  6. Brokers

    Broker-Dealer Industry 101: The Landscape

    Independent broker-dealers are a great choice for experienced, self-starter planners who have established practices.
  7. Brokers

    Explaining Market Orders

    A market order is the most common order used to purchase a financial security.
  8. Term

    What is Financial Technology?

    Financial technology, or fintech, is a financial services sector that emerged in the 21st century.
  9. Investing Basics

    What's a Brokerage Account?

    A brokerage account is a contractual arrangement between an investor and a licensed securities broker or brokerage.
  10. Investing Basics

    Is Your Broker Churning Your Account?

    Is your broker churning your account to generate fees? Here's how to know and what recourse you have.
RELATED FAQS
  1. What is a rainmaker?

    A rainmaker is any person who brings clients, money, or respect to an organization based solely on his or her association. ... Read Full Answer >>
  2. What is the interest rate offered on a typical margin account?

    Interest rates on margin accounts vary according to the size of the loan and the brokerage firm being used. Generally, interest ... Read Full Answer >>
  3. What is the cost of a share purchase?

    When investors purchase shares of stock, the price paid includes two components: the price of the stock and the fee charged ... Read Full Answer >>
  4. What is the difference between fee-based advisors and commission-based advisors?

    The difference between a fee-based adviser and a commission-based adviser is that the former collects a flat fee for investment ... Read Full Answer >>
  5. What is the difference between a custodian bank and a mutual fund custodian?

    Custodian banks and mutual fund custodians, commonly known as mutual fund corporations, perform very similar roles for different ... Read Full Answer >>
  6. How does an insurance broker make money?

    An insurance broker makes money off commissions from selling insurance to individuals or businesses. Most commissions are ... Read Full Answer >>

You May Also Like

Hot Definitions
  1. Stock Market Crash

    A rapid and often unanticipated drop in stock prices. A stock market crash can be the result of major catastrophic events, ...
  2. Financial Crisis

    A situation in which the value of financial institutions or assets drops rapidly. A financial crisis is often associated ...
  3. Election Period

    The period of time during which an investor who owns an extendable or retractable bond must indicate to the issuer whether ...
  4. Shanghai Stock Exchange

    The largest stock exchange in mainland China, the Shanghai Stock Exchange is a nonprofit organization run by the China Securities ...
  5. Dead Cat Bounce

    A temporary recovery from a prolonged decline or bear market, followed by the continuation of the downtrend. A dead cat bounce ...
  6. Bear Market

    A market condition in which the prices of securities are falling, and widespread pessimism causes the negative sentiment ...
Trading Center
×

You are using adblocking software

Want access to all of Investopedia? Add us to your “whitelist”
so you'll never miss a feature!