This morning diversified wealth company IOOF Holdings Ltd (ASX: IFL) released its 2016 financial update to the market and it wasn’t great reading.

The company has stated that it expects underlying net profit after tax for the year to 30 June 2016 to be in line with last year and in the range of $173m to $176m.

Management has stated that revenues in the second half of the financial year have been adversely affected by equity market devaluations and its negative impact on funds under management, advice and administration.

Last month the company revealed that funds under management, administration, advice and supervision totalled $131 billion as of 31 March. This was down $1.7 billion on the prior quarter, with the company placing the blame on market movements.

IOOF Managing Director, Christopher Kelaher stated that:

“Following a decline during the first half of the 2016 financial year, the ASX All Ordinaries index fell another 10% in the early months of calendar 2016. Despite recent improvement in conditions, market valuations have failed to recover to mid-2015 levels. This volatility in markets has created challenges but the longer term industry fundamentals remain positive and IOOF’s balance sheet remains strong.”

As positive as Mr Kelaher may be, the market doesn’t appear to share the same sentiment. Shortly after the market opened IOOF’s share price had taken a 4% dive down to $8.52. This means it is now down by almost 18% in the last 12 months.

Which isn’t surprising considering the lofty expectations the market had on IOOF. According to CommSec, analysts have been expecting full year earnings per share to come in at 59.5 cents. Based on the 299.7 million ordinary shares it had in its half year report, I would now expect the company to fall short of expectations and deliver full year earnings in the range of 57.7 to 58.7 cents per share.

Today’s decline does mean that its shares now provide an estimated fully franked FY 2016 dividend of 6.5%. Which will no doubt be very tempting for investors in search of income.

However, I would probably wait until the company starts to show an improved performance before making an investment. I have little doubt things will pick up soon, but I believe today there are better options available to investors with the likes of Magellan Financial Group Ltd (ASX: MFG) and even BT Investment Management Ltd (ASX: BTT).

Better yet, these three shares will potentially be even better picks. I believe these shares will provide both a solid dividend and share price gains that take your portfolio to the next level.

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Motley Fool contributor James Mickleboro has no position in any stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.