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Practice Management > Building Your Business

Editor's Note: A New Focus

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The advisor I met in Denver on March 18 was an experienced hand, a longtime NAPFA member to boot, but he told me that not only was he seriously considering using annuities–horrors!–for his clients’ retirement income needs, but he confided he was rethinking everything, everything he thought he knew about investing.

Tom Naughton, who has been managing money in Asia for 15 years, told me on March 17 that “investing money now is more difficult than ever.” Charles Goldman, the ex-Schwab Institutional chief who now runs Fidelity’s RIA custody unit, National Financial clearing arm, and family office business, in an interview on March 19 said that “nothing feels like” the current macroeconomic environment. Unlike previous financial and market crises Goldman’s been through “it’s so much more systemic” now, he says. David Edstrom, the veteran advisor and chief marketing officer of the Chicago-based advisor outsourcing firm BridgePortfolio, admitted to me in February that “this is the first time I’ve had trouble sleeping.” Then he voiced a sentiment that I’ve noticed among many advisors I’ve spoken with over the past month or so: “Now that the shock is over, it’s time to get new clients.”

That’s the motivation behind LPL’s new referral program, and behind the dating services that Schwab, Fidelity, TD Ameritrade, and Pershing Advisor Solutions are all running for captive brokers looking for new homes and which can benefit existing RIA firms that are looking to grow by adding a new partner with a nice book of business, or even provide a successor longer term. The big independent broker/dealers have similar programs for similar reasons, though some cannot quite publicize them if they are part of a bigger organization.

But moving forward, even with new clients, advisors are looking more carefully at their partners, especially those to whom they outsource money management. Jeff Montgomery, the former NFP Securities honcho who is now CEO of the venerable asset management firm Al Frank Asset Management, told me earlier in March that “the level of scrutiny, and appropriately so, of any money manager has gone up in an incredibly healthy way.”

We can provide some help in that regard: our cover story this month that reveals the winners of our fifth annual Separately Managed Accounts Awards (page 40). With due diligence king Prima Capital doing the research heavy lifting, we present for your consideration seven money management teams that we humbly believe are tops in their fields. These teams offer separate accounts through multiple platforms in both equities and fixed income, large cap and small, domestic and foreign ADR flavors, to high-net-worth individuals and small institutions who might benefit from SMAs’ traits of customization and tax efficiency–an area that is likely to be of more interest to your clients in the months and years ahead.

There’s another part of the magazine debuting this month that’s particularly timely: a new section in the front of the book called Danger & Opportunity (page 13) that will deliver targeted information on developments in Washington, insights into investing, and practice management tips to help you get through the current crisis and take advantage of the opportunities that crisis always presents. As Al Frank’s Montgomery says, “crisis creates incredible focus.” We’re here to help.


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