Management Pressure

4 replies [Last post]
CueYouWhy's picture
Offline
Joined: 2007-03-13

For those of you who has done well in the business or went independent, is the old saying really true? “You are hired to be an asset gather not a portfolio manager” “leave the portfolio management to the Ivy Leagues”
<?: prefix = o ns = "urn:schemas-microsoft-com:office:office" /> 
Management always made sure you understood your place. My question is: can one be efficient at BOTH?
 
Does the typical multi-million dollar producer worry about portfolio management?
 
Does RIAs  have access to third party money managers? Or is pretty much a one man ship?
 
Are there any FAs out there that actually run their client portfolios? Or have we become a breed of asset gathering machines?

anonymous's picture
Offline
Joined: 2005-09-29

QUESTION: How much do you get paid to gather assets? 
ANSWER: A lot!
 
QUESTION: How much does management get paid for you to gather assets?
 
ANSWER: A lot!
 
QUESTION: How much do you get paid to manage a portfolio?
 
ANSWER: Nothing.
 
QUESTION: How much does management get paid for you to manage a portfolio?
 
ANSWER: Nothing.
 
Someone can certainly be good at both, but they are separate skill sets.  Since we have access to professional management, why would we not spend our time doing what makes us money?   That is especially true for people like me who believe that specific investment choices is not what is going to determine the financial success of our clients. 

Ashland's picture
Offline
Joined: 2007-03-06

I'd rephrase the question. Can one be both an effective client manager and portfolio manager?

Being a client manager means helping clients have the life they want, helping them navigate financial transitions, and providing them w/ concierge services.

Portfolio manager is managing the money.

I don't think there's enough time in the world for both. These are the investment categories that Morningstar uses when subadvising the Idex funds for Transamerica. Tell me what you think of each one, please:

Domestic:
Large - Growth, Core, Value
Mid - Growth, Core, Value
Small - Growth, Core Value

Foreign:
(Latin America, N America, Europe, Far East, Emerging, Developed, BRIC)
Large - Growth, Core, Value
Mid - Growth, Core, Value
Small - Growth, Core Value

Bond:
(Short, Medium & Long Durations in each category below)
Corporate
Government
High-Yield
TIPS
Foreign
Emerging
Convertible
Asset-Backed

Alternative Strategies:
Long /Short
Market Neutral
Global Real Estate
Natural Resources / Commodities
Foreign Currency Trading
U.S. Micro Cap
Emerging Market
Bear Market
Global Tactical Asset Allocation
Global Tactical Fixed Income

Also, you have the capability of modelling how earnings surprises will work into this whole thing & have time to watch & read enough to get all of the information. You have 20 - 30 analysts working for you throughout the world that give you indications on the various asset classes. Finally, you have the ability to visit with & talk with various managers to determine who will perform best in the future in each of these asset classes & renew your research regularly to make sure things haven't changed.

Us, portfolio managers... right.

doberman's picture
Offline
Joined: 2005-02-22

anonymous wrote:
QUESTION: How much do you get paid to gather assets? 
ANSWER: A lot!
 
QUESTION: How much does management get paid for you to gather assets?
 
ANSWER: A lot!
 
QUESTION: How much do you get paid to manage a portfolio?
 
ANSWER: Nothing.
 
QUESTION: How much does management get paid for you to manage a portfolio?
 
ANSWER: Nothing.
 
Someone can certainly be good at both, but they are separate skill sets.  Since we have access to professional management, why would we not spend our time doing what makes us money?   That is especially true for people like me who believe that specific investment choices is not what is going to determine the financial success of our clients. 
 
Good post, anon. These should be some of the questions and answers on the 7.

Please or Register to post comments.

Industry Newsletters
Careers Category Sponsor Links

Sponsored Introduction Continue on to (or wait seconds) ×