Smith Barney vs. UBS vs. Merrill vs. ..

49 replies [Last post]
RecruitingAce's picture
Offline
Joined: 2006-06-22

Merrill Lynch, Morgan Stanley, UBS or Smith Barney???  So many choices...
Many of you have asked me to explain the difference between the different training programs, so I'll do my best to hit the highlights here.  Understand I have recruited for all of them at one time or another and have decided to only focus on recruiting for Smith Barney now for the past two years for reasons that will be apparent after reading this...
Compensation:
Merrill Lynch pays a salary for 2 years and they tend to pay on the higher range between the 4.  However, and this is very important to understand...  What you have there is a monthly forgiveable draw!  It is NOT a salary plus commission position.
Morgan Stanley pays a salary for one year, and no commissions in the first year 
UBS salary is tied into your production for the first 2 years.  If you do not meet your goals, they take a percentage of your salary away.  (this really stinks by the way when you are trying to pay your bills)
Smith Barney compensation is salary for 2.5 years, PLUS commission, PLUS bonuses if you are meeting your goals.  And stock options on top of all that.
So, to compare the four, let's take an arbitrary example.  Let's assume you you are offered a salary of 50K at each company and your production in your first year is 50K.   Here is about what you would make after your first year:
Merrill:  50K because they only allow you to keep commissions (at 50% payouts) if they exceed your salary in any given month.  In this example your commissions would not exceed your salary.  
Morgan Stanley:  same thing.  50K
UBS is better.  You would probably keep around 60k because you are meeting your minimum goals and they are not taking a percentage of your salary away.
Smith Barney:  about 70K conservatively.   50K salary, plus 33.25% commissions on the 50k (16K), plus around 4-6K in cash bonuses for the year.  And another 10-15k in stock options on top of all that in each of your first 3 years.
Culture / Reputation:
Merrill Lynch.  One word.  Stuffy.
Morgan Stanley.  Another word.  Trouble.
UBS.  No real problems there.
Smith Barney.  Exclusive and entrepreneurial.
 
Difficulty in getting hired:
Merrill:  not overly difficult.
Morgan Stanley:  they're somewhat desperate.
UBS:  Not easy to get hired.
Smith Barney:  Very difficult to get hired.
Overall, although it is a long and tedious process to get in with these companies, you have a better chance at success, honestly, with Smith Barney if you get hired.
And before you all flame me for being biased, I will say this again.  I have had a chance to recruit for all of these firms.  I have CHOSEN to recruit for Smith Barney exclusively!
I hope this helps!

Breaston15's picture
Offline
Joined: 2006-05-01

As far as the effectiveness of the training programs, how would you describe each firms (methods, materials, etc.)?

Thanks

RecruitingAce's picture
Offline
Joined: 2006-06-22

Breaston,
That's a good question.  Here's the best short answer I can provide.
Merrill makes it difficult to succeed in their POA program because they impose some serious restrictions on who you can bring on as a client.  As a rsult, many fail there.  
Morgan Stanley is having a lot of internal problems as a result of recent very bad press over their business dealings.  they brought in a big wig from Merrill to shake the company up, and shake it up he has.  I can't tell you how many resumes from Morgan Stanley cross my desk every day...  There is also a lot of manager turn-over going on company-wide which makes it hard to be successful there as a trainee when the manager who hired you is being demoted or booted out on a regular basis.
UBS is pretty stable.  Their training program is a good one.  Their reputation is also solid.  The only real problem I have with them is that instead of offering you a carrot to succeed there, instead they punish you for not meeting your goals by taking money out of your pocket.
At Smith Barney, your salary is your salary, and if you don't do well, all that happens is that you don't get as many bonuses.
ALSO, and a very important point I forgot to mention earlier, YOU CAN OFFER LOAN PRODUCTS to your customers at Smith Barney!  Bottom line here, is more opportunity to make more commissions for yourself!
  

Breaston15's picture
Offline
Joined: 2006-05-01

What kind of production hurdles does SB have? Or is it a once you're in, you're in until you make too little and quit deal?

troll's picture
Offline
Joined: 2004-11-29

RecruitingAce wrote:
Merrill Lynch, Morgan Stanley, UBS or Smith Barney???  So many choices...
Many of you have asked me to explain the difference between the different training programs, so I'll do my best to hit the highlights here.  Understand I have recruited for all of them at one time or another and have decided to only focus on recruiting for Smith Barney now for the past two years for reasons that will be apparent after reading this...
Compensation:
Merrill Lynch pays a salary for 2 years and they tend to pay on the higher range between the 4.  However, and this is very important to understand...  What you have there is a monthly forgiveable draw!  It is NOT a salary plus commission position.
Morgan Stanley pays a salary for one year, and no commissions in the first year 
UBS salary is tied into your production for the first 2 years.  If you do not meet your goals, they take a percentage of your salary away.  (this really stinks by the way when you are trying to pay your bills)
Smith Barney compensation is salary for 2.5 years, PLUS commission, PLUS bonuses if you are meeting your goals.  And stock options on top of all that.
So, to compare the four, let's take an arbitrary example.  Let's assume you you are offered a salary of 50K at each company and your production in your first year is 50K.   Here is about what you would make after your first year:
Merrill:  50K because they only allow you to keep commissions (at 50% payouts) if they exceed your salary in any given month.  In this example your commissions would not exceed your salary.  
Morgan Stanley:  same thing.  50K
UBS is better.  You would probably keep around 60k because you are meeting your minimum goals and they are not taking a percentage of your salary away.
Smith Barney:  about 70K conservatively.   50K salary, plus 33.25% commissions on the 50k (16K), plus around 4-6K in cash bonuses for the year.  And another 10-15k in stock options on top of all that in each of your first 3 years.
Culture / Reputation:
Merrill Lynch.  One word.  Stuffy.
Morgan Stanley.  Another word.  Trouble.
UBS.  No real problems there.
Smith Barney.  Exclusive and entrepreneurial.
 
Difficulty in getting hired:
Merrill:  not overly difficult.
Morgan Stanley:  they're somewhat desperate.
UBS:  Not easy to get hired.
Smith Barney:  Very difficult to get hired.
Overall, although it is a long and tedious process to get in with these companies, you have a better chance at success, honestly, with Smith Barney if you get hired.
And before you all flame me for being biased, I will say this again.  I have had a chance to recruit for all of these firms.  I have CHOSEN to recruit for Smith Barney exclusively!
I hope this helps!

 
Right, you "chose" to recruit for only SB, declining money from the others. 
 
I hope no one takes your review to heart, it's deeply flawed and, of course, biased.

bjack73's picture
Offline
Joined: 2006-04-23

If you anythiing about their program, where would you rank Raymond James in that mix???

bjack73's picture
Offline
Joined: 2006-04-23

bjack73 wrote:
If you know anythiing about their program, where would you rank Raymond James in that mix???

The Judge's picture
Offline
Joined: 2006-06-06

At Smith Barney, you no longer have access to that wonderful analyst telecom analyst. What a shame. Not.
Smith Barney is as good/bad as any other wirehouse. It more depends on the office/manager.
BTW if their training program was so good, they might not be offering 200% of your trailing twelve for seasoned vets. 

BrokerRecruit's picture
Offline
Joined: 2005-04-19

Frankly, I have many strong relationships within Smith Barney and think highly of them.  My money is on MS at this point.  I like what they're doing.

Spikie's picture
Offline
Joined: 2006-06-07

BrokerRecruit wrote:Frankly, I have many strong relationships within Smith Barney and think highly of them.  My money is on MS at this point.  I like what they're doing.Can you be more specific about MS?

RecruitingAce's picture
Offline
Joined: 2006-06-22

BJack,
Raymond James is also a good company.  However, the brand name recognition is not as strong as the others which, as you may know, makes it harder to get clients.  
As far as their training program goes, I do not know enough about it to speak of it, but I can tell you I have never lost a candidate because he went to Raymond James instead.
Ace

Rugby's picture
Offline
Joined: 2006-06-06

BrokerRecruit-
Could you be elaborate a little on what MS is doing that you like?
They just announced a great QTR...I'd be interested in why you like them at this point.
Thanks,
Rugby
 
 
 
 

BrokerRecruit's picture
Offline
Joined: 2005-04-19

I just think it's a good story.  You've got two very committed leaders in Mack and Gorman.  Some like them, I don't.  I happen to like those that aren't afraid to make brash decisions and know that it's ok to spend money to make money.  Gorman has certainly pissed some people off along the way, but his track record at Merrill shows that he can lead (or at least act like they know how).

Biasedrecruiter's picture
Offline
Joined: 2006-04-04

Even thought Smith Barney is my primary client; my money is on Mike Butler and BrokerRecruit.. While it is difficult to change horses during the race: Morgan Stanley is putting their money where their mouth is.
 
Did you see the Dow Jones newswire article about Merrill survey to brokers asking them if they were talking to the competition? They mean Morgan Stanley. I have been told by many big long time Merrill producers they are in play with Morgan Stanley. Just a matter of time.

killerRep's picture
Offline
Joined: 2005-12-17

Wow, this is a very biased topic I have ever seen (besides the EJ fans). This is like saying: Apples vs oranges vs Pineapples Which is better! (I have a point to why it's like this...)
The wirehouse wars have been bigger than ever and since most are loyal to their pockets, its only time that most will jump the vanwagon from one wirehouse to another (or just go indy). So in the end, its not about the wirehouse or ANY other company for that matter, its about your personal production, benefits of the company, and (in some occassions) loyalty. Hence: Apples, Oranges, or Pineapples? That is just my personal opinion...
Biasedrecruiter: you wouldn't happen to have a link to that newswire? im curious on the ML vs MS issue.
here is a nice ML vs SB fact: http://registeredrep.com/mag/finance_hired_fired/index.html

lawsucks's picture
Offline
Joined: 2006-05-18

Biasedrecruiter wrote:  Merrill, the largest brokerage house in the U.S., is a signatory to the interbrokerage pact that allows brokers to leave with client contact information so they can ask customers whether they wish to transfer accounts to the new firm. Brokers, however, must leave behind account details.  
The protocol, designed to allow brokers to switch firms without fear of legal reprisal, requires firms to transfer account data within a day of receiving a one-page authorization from a brokers' client.
For years prior to the pact, Merrill rushed to court shortly after receiving notice from brokers to prevent them from taking clients with them. The firm more recently also has sought temporary restraining orders to prevent brokers from contacting clients and to prevent former executives from recruiting key talent.
GORMAN IS A GENIUS.
While at Merrill, he oversees a radical change in policy - the firm agrees to not go after departed brokers.  Shortly thereafter, he goes to MS and recruits Merrill brokers!
Does anyone else think he might have had this planned out ahead of time?

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

" However, the brand name recognition is not as strong as the others which, as you may know, makes it harder to get clients."
This is only true if you believe it to be so.

RecruitingAce's picture
Offline
Joined: 2006-06-22

Anonymous -
I believe it to be so because I hear it every day from brokers who are in the business.  Low name brand recognition makes it harder to attract the big dollars.
And I have spoken with thousands over the years.
 
 
 

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

Did you ever think that low name brand recognition is used as an excuse from these brokers?
As an example, LPL has some huge producers, but the public doesn't have a clue as to who they are.  The public just knows Jim Jones from "Jones Wealth Management".  ...and they've only heard of the firm because someone referred them to Jim.

killerRep's picture
Offline
Joined: 2005-12-17

thanks biasedrecruiter.
a lot of you guys are confirming what I have been trying to say to the newbies. In the end, its the producer not the company

Diplomaticos's picture
Offline
Joined: 2006-02-01

Morgan Stanley is a top tier investment bank.  They are up with
the likes of Goldman, Lehman and Bear.  Their stock has done a
good job of rising and their wealth management division just had their
best quarter since the first quarter of 2001.  Gorman said they
are going to stabilize at around 8,000 brokers.  The best thing is
that recently they have shown that they are willing to spend money to
make money.  Technology changes, more deals (Highland Capital will
be listed Monday).  The thing is that with anything, you either
leave at the very top or the very bottom.  A lot of people left MS
at the bottom last year.  It makes no sense for people to leave at
this point seeing the vast improvements MS is making.  As for the
training, it sucks, they are going to completely overhaul it and I
truly believe they will start to bring in top talent.  The one
thing that baffles me is the low number of ptople in MS GWM that went
to good schools.  It seems as if the sky is the limit on the money
you can make, especially with a good name like MS behind you.  Why
dont people from top tier schools get into the wealth management
business? Also, there is a revenue based bonus you can recieve at MS in
your first year.  

opie's picture
Offline
Joined: 2006-06-15

Biasedrecruiter wrote:Merrill, the largest brokerage house in the U.S., is a signatory to the interbrokerage pact that allows brokers to leave with client contact information so they can ask customers whether they wish to transfer accounts to the new firm. Brokers, however, must leave behind account details.   The protocol, designed to allow brokers to switch firms without fear of legal reprisal, requires firms to transfer account data within a day of receiving a one-page authorization from a brokers' client. Wachovia Corp. (WB) unit Wachovia Securities, Citigroup Inc. (C) unit Smith Barney and the UBS Wealth Management unit of UBS AG (UBS) have also signed the pact.
Does this mean that MS is not part of the pact?  And does this pact preclude the broker from taking his clients to an indy?

san fran broker's picture
Offline
Joined: 2006-02-25

Diplomaticos wrote: The one thing that baffles me is the low number of ptople in MS GWM that went to good schools. 
They tend to be in the Private Wealth Management division at MS.

Rugby's picture
Offline
Joined: 2006-06-06

RecruitingAce-
Can you comment on the following payout grid regarding SB (from
onwallstreet)? 
Thanks,
Rugby

RecruitingAce's picture
Offline
Joined: 2006-06-22

Rugby -
Yes I can. If you will notice, at the 600K and 1M level of production, the grid clearly shows that Smith Barney payouts are higher than Merrill, Morgan Stanley and UBS.
At the 200K and 400K level, Smith Barney is the lowest amongst the three.
HOWEVER, if you read the assumptions in the fine print, it clearly states that these payouts are based on someone who has been there for 7 years!  In other words, if you have been at Smith Barney for 7 years and are only producing at a 200 - 400K level, then there is something clearly wrong with your production and because of that, Smith Barney does not reward lethargicism.
On the other hand, if you are between 600K to 1M in production after 7 years, then not only do they reward you well, but they reward you better than any other wirehouse in the industry!
I hope this helps.
 
 

NASD Newbie's picture
Offline
Joined: 2005-08-01

RecruitingAce wrote:
lethargicism.

Do that be a real word?

NASD Newbie's picture
Offline
Joined: 2005-08-01

Diplomaticos wrote:
Morgan Stanley is a top tier investment bank.  They are up with the likes of Goldman, Lehman and Bear.

No, Morgan Stanley WAS a top tier investment bank--then they bit off Dean Witter and all hell broke loose.
As for Lehman--do they still have that boiler room at 55 Water Street?

troll's picture
Offline
Joined: 2004-11-29

NASD Newbie wrote:
Diplomaticos wrote:
Morgan Stanley is a top tier investment bank.  They are up with the likes of Goldman, Lehman and Bear.

No, Morgan Stanley WAS a top tier investment bank--then they bit off Dean Witter and all hell broke loose.
You might want to take a look at recent investment banking numbers before you speak again, Put. There are only two top-tier banking players these days, MS and GS.

Rugby's picture
Offline
Joined: 2006-06-06

OK.  So in year one through three (Training period) you still say that SB has the best payout grid versus other major wirehouses?

Diplomaticos's picture
Offline
Joined: 2006-02-01

In year 2 at MS, u make 33% grid, get a 25% revenue bonus and on top of
that get your salary.  so, if you do 100k in revenue in your
second year, you make 25k in bonus, 33k in commissions and lets say 30k
in salary. This is 88k, what other company does better than that? 
Also, NASD Newbie, MS is still a top tier investment bank.  Have
you heard of a company called google? who did that deal?
Chipotle....the hottest IPO since 2001, another MS deal.  Plus,
check out the recent earnings, there are only 2 top investment banks
these days, MS and GS.  Smith Barney is owned by a bank not a
securities firm, Citi is having tons of problems, it will be
interesting to see what Chucky P can do over there, otherwise, with all
the pressure from the Saudis, they are going to get broken up.  I
bet no one on these boards ever was in the ball park to be interviewed
by GS. 

troll's picture
Offline
Joined: 2004-11-29

Diplomaticos wrote:In year 2 at MS, u make 33% grid, get a 25% revenue bonus and on top of
that get your salary.  so, if you do 100k in revenue in your
second year, you make 25k in bonus, 33k in commissions and lets say 30k
in salary. This is 88k, what other company does better than that? 
Also, NASD Newbie, MS is still a top tier investment bank.  Have
you heard of a company called google? who did that deal?
Chipotle....the hottest IPO since 2001, another MS deal.  Plus,
check out the recent earnings, there are only 2 top investment banks
these days, MS and GS.  Smith Barney is owned by a bank not a
securities firm, Citi is having tons of problems, it will be
interesting to see what Chucky P can do over there, otherwise, with all
the pressure from the Saudis, they are going to get broken up.  I
bet no one on these boards ever was in the ball park to be interviewed
by GS. 
Who really CARES if they are a top tier investment banker or not?  For most truly professional advisers, the IPO game is a complete waste of time....

NASD Newbie's picture
Offline
Joined: 2005-08-01

joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.

troll's picture
Offline
Joined: 2004-11-29

NASD Newbie wrote:joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.There's a glaring flaw or two in your analysis Newbie....For starters, remember that investment bankers are not the adviser's friend.  Their job is to get shares of the client company sold for as high a valuation as possible.  Not really a question that is open to debate...it's the duty they have to their client-the company going public.Too, as you alluded, the deals you really want you almost never get enough shares.  Yet, to get a sufficiently high "index"(or whatever variation they have at "your" firm) you must participate heavily many or all of the other deals with aren't as hot, or perhaps even SUCK.  Consider, for example, new issues of closed end funds. How many of those are actually a good deal....in the best interests of the client?  Most of them you could easily pick up for 10-15% less once the syndicate bid drops out in about 90-120 days.  (Speaking only generically and hypothetically, of course.  Not making ANY recommendations for action!)Last but not least, consider that when you're partipating in the IB process as an advisor, providing "distribution", what you're essentially doing in the case of a true NEW IPO is helping clients purchase shares in companies that are unseasoned.  Often these companies are managed by staff with little or no experience in running a publicy traded firm.  Those who have had insight into this process know that running a public company versus private firm is another league entirely with another consituency(shareholders) to serve.  Why mess around with that stuff when there are so many good quality companies out there with established track records as public firms?Just one man's opinion....

RecruitingAce's picture
Offline
Joined: 2006-06-22

Diplomaticos -
A good answer with good, supporting facts regarding Morgan Stanley in the second year.   Now, here's the "rest of the story..."
You say that at Morgan Stanley in the second year that you would be making around 88K if you are producing 100K...  33% equals 33,000, plus 30K salary, plus a 25K bonus.  Fine.   Then you challenged the Board to provide a better compensation than that.. and so I will.
First of all, at Morgan Stanley, in your first year you only make your salary.  No commissions.  So let's assume that in year one a new producer generates 50K, and in year two, by your assumed numbers, he/she is at 100K.
At Morgan Stanley in year 1 you make 30K (according to your assumed salary).  In year two, you make 88K.. for a grand total of 118K in 2 years.  Not bad.
At SMITH BARNEY, in year one you make 30K salary (by your assumption, although Smith Barney pays a LOT more than that in salary), plus 33.25% payout = 16,600, plus 6K in cash bonuses, PLUS 10K in stock option bonus.  TOTAL IN YEAR (not including stock options) is:  52,600.
In YEAR TWO, assuming 100K production, that's 33,250 in commissions (33.25%), plus 30K salary, plus another 6K in cash bonus, plus another 10K in stock options.  TOTAL IN YEAR 2 (not including stock options): $69,250.  
TOTAL in 2 years at Morgan Stanley:  $118K
TOTAL at Smith Barney in 2 years:  $121,250 (not including 20K more in stock options)
WINNER:  Smith Barney
 

Rugby's picture
Offline
Joined: 2006-06-06

What stock do you want to own?  MS or C?
http://finance.yahoo.com/q/bc?s=MS&t=2y&l=on&z=m &q=l&c=c

troll's picture
Offline
Joined: 2004-11-29

joedabrkr wrote:
NASD Newbie wrote:joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.There's a glaring flaw or two in your analysis Newbie....For starters, remember that investment bankers are not the adviser's friend.  Their job is to get shares of the client company sold for as high a valuation as possible.  Not really a question that is open to debate...it's the duty they have to their client-the company going public.Too, as you alluded, the deals you really want you almost never get enough shares.  Yet, to get a sufficiently high "index"(or whatever variation they have at "your" firm) you must participate heavily many or all of the other deals with aren't as hot, or perhaps even SUCK.  Consider, for example, new issues of closed end funds. How many of those are actually a good deal....in the best interests of the client?  Most of them you could easily pick up for 10-15% less once the syndicate bid drops out in about 90-120 days.  (Speaking only generically and hypothetically, of course.  Not making ANY recommendations for action!)Last but not least, consider that when you're partipating in the IB process as an advisor, providing "distribution", what you're essentially doing in the case of a true NEW IPO is helping clients purchase shares in companies that are unseasoned.  Often these companies are managed by staff with little or no experience in running a publicy traded firm.  Those who have had insight into this process know that running a public company versus private firm is another league entirely with another consituency(shareholders) to serve.  Why mess around with that stuff when there are so many good quality companies out there with established track records as public firms?Just one man's opinion....Interesting how Newbie never responded to this one....maybe he didn't have a good rebuttal?  Or too busy trading insults with Metellnoname? 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->

Diplomaticos's picture
Offline
Joined: 2006-02-01

Artie, first year at MS you make a 20% revenue bonus.  so you
would make 36k your first year.  also, how long is the lock up
with the stock options? How about the fact that all the other banks are
making big money and Citi seems to be lagging?  It seems as if
they are having problems now (not that MS hasnt had problems in the
past year).  I truly believe MS is building a solid foundation to
become #1 in the business.  I have seen no very big producers from
MS leaving lately, only smaller ones (under 500k).  However, I
have seen numerous big advisors coming to MS recently. 
Winner?  Morgan Stanley!

blarmston's picture
Offline
Joined: 2005-02-26

Dip.... Gorman's got you drinking out of the MS goblet of kool-aid eh????? While I agree that MS has made great strides to firm up its position as a top tier firm, they still have a long way to go before the industry can consider them on par with SB and ML.... I have a good friend at MS in NY and even a top recruiter in my area (who calls me the first Monday of every month like clockwork at 930am) agree with that statement.
They are making sound moves... But Gorman (who was eased out of ML by the way) still has several more years or radical changes to go....

Indyone's picture
Offline
Joined: 2005-05-30

blarmston wrote:... But Gorman (who was eased out of ML by the way)....
Blarm, that's the first I've heard this...what's the rest of the story...why was he "eased out"?

RecruitingAce's picture
Offline
Joined: 2006-06-22

Hey Diplo -
Only my rugby teamates call me Artie.. but I guess it's okay if you do the same.
As far as Morgan Stanley goes, I guess you have to be in my shoes to see the many resumes I receive every day and conclude that out of all the firms out there, it seems that I see the greatest percentage of people who are looking for a new position coming from Morgan Stanley.
Best...

san fran broker's picture
Offline
Joined: 2006-02-25

joedabrkr wrote: joedabrkr wrote: NASD Newbie wrote:
joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.
There's a glaring flaw or two in your analysis Newbie....For starters, remember that investment bankers are not the adviser's friend.  Their job is to get shares of the client company sold for as high a valuation as possible.  Not really a question that is open to debate...it's the duty they have to their client-the company going public.Too, as you alluded, the deals you really want you almost never get enough shares.  Yet, to get a sufficiently high "index"(or whatever variation they have at "your" firm) you must participate heavily many or all of the other deals with aren't as hot, or perhaps even SUCK.  Consider, for example, new issues of closed end funds. How many of those are actually a good deal....in the best interests of the client?  Most of them you could easily pick up for 10-15% less once the syndicate bid drops out in about 90-120 days.  (Speaking only generically and hypothetically, of course.  Not making ANY recommendations for action!)Last but not least, consider that when you're partipating in the IB process as an advisor, providing "distribution", what you're essentially doing in the case of a true NEW IPO is helping clients purchase shares in companies that are unseasoned.  Often these companies are managed by staff with little or no experience in running a publicy traded firm.  Those who have had insight into this process know that running a public company versus private firm is another league entirely with another consituency(shareholders) to serve.  Why mess around with that stuff when there are so many good quality companies out there with established track records as public firms?Just one man's opinion....Interesting how Newbie never responded to this one....maybe he didn't have a good rebuttal?  Or too busy trading insults with Metellnoname? 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->
I'll put in a rebuttal.
If you participate in every deal and flip 30 or so days out, your average should be quite good. If you look at the average performance of all IPOs (www.ipohome.com), you will see that almost every bank's deals (on average) do quite well relative to their peer group. If you have the clientele (hedge funds, money managers), you can sell every deal and as much as you can get. They will buy into every deal and never complain.
Syndicate is very good business. There just isn't that much of it for most brokers.

troll's picture
Offline
Joined: 2004-11-29

san fran broker wrote:joedabrkr wrote: joedabrkr wrote: NASD Newbie wrote:
joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.
There's a glaring flaw or two in your analysis Newbie....For starters, remember that investment bankers are not the adviser's friend.  Their job is to get shares of the client company sold for as high a valuation as possible.  Not really a question that is open to debate...it's the duty they have to their client-the company going public.Too, as you alluded, the deals you really want you almost never get enough shares.  Yet, to get a sufficiently high "index"(or whatever variation they have at "your" firm) you must participate heavily many or all of the other deals with aren't as hot, or perhaps even SUCK.  Consider, for example, new issues of closed end funds. How many of those are actually a good deal....in the best interests of the client?  Most of them you could easily pick up for 10-15% less once the syndicate bid drops out in about 90-120 days.  (Speaking only generically and hypothetically, of course.  Not making ANY recommendations for action!)Last but not least, consider that when you're partipating in the IB process as an advisor, providing "distribution", what you're essentially doing in the case of a true NEW IPO is helping clients purchase shares in companies that are unseasoned.  Often these companies are managed by staff with little or no experience in running a publicy traded firm.  Those who have had insight into this process know that running a public company versus private firm is another league entirely with another consituency(shareholders) to serve.  Why mess around with that stuff when there are so many good quality companies out there with established track records as public firms?Just one man's opinion....Interesting how Newbie never responded to this one....maybe he didn't have a good rebuttal?  Or too busy trading insults with Metellnoname? 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->
I'll put in a rebuttal.
If you participate in every deal and flip 30 or so days out, your average should be quite good. If you look at the average performance of all IPOs (www.ipohome.com), you will see that almost every bank's deals (on average) do quite well relative to their peer group. If you have the clientele (hedge funds, money managers), you can sell every deal and as much as you can get. They will buy into every deal and never complain.
Syndicate is very good business. There just isn't that much of it for most brokers.In theory that sounds great.   But don't forget that for the 'hot' deals allocation is limited and yet for the dogs it's all you can eat.  I suspect that might hurt your real world returns.Too, with most firms if you keep flipping out of deals after 30 days you might see the syndicate department make a call to the branch manager to cut back your allocation, too! 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->

san fran broker's picture
Offline
Joined: 2006-02-25

joedabrkr wrote: san fran broker wrote:joedabrkr wrote: joedabrkr wrote: NASD Newbie wrote:
joedabrkr wrote:For most truly professional advisers, the IPO game is a complete waste of time....
The ability to get some new issue allocation for your better accounts is a reason to work for a wirehouse.
You cannot expect independents--such as Joe--to acknowledge that reality because it's a game they'll never play.  It's like a guy who never gets a date with a beautiful girl--he'll tell himself that beautiful girls are overrated.
Nobody gets as many shares of the hot stocks as they could sell--but it's nice to get some and your clients will appreciate it.
There's a glaring flaw or two in your analysis Newbie....For starters, remember that investment bankers are not the adviser's friend.  Their job is to get shares of the client company sold for as high a valuation as possible.  Not really a question that is open to debate...it's the duty they have to their client-the company going public.Too, as you alluded, the deals you really want you almost never get enough shares.  Yet, to get a sufficiently high "index"(or whatever variation they have at "your" firm) you must participate heavily many or all of the other deals with aren't as hot, or perhaps even SUCK.  Consider, for example, new issues of closed end funds. How many of those are actually a good deal....in the best interests of the client?  Most of them you could easily pick up for 10-15% less once the syndicate bid drops out in about 90-120 days.  (Speaking only generically and hypothetically, of course.  Not making ANY recommendations for action!)Last but not least, consider that when you're partipating in the IB process as an advisor, providing "distribution", what you're essentially doing in the case of a true NEW IPO is helping clients purchase shares in companies that are unseasoned.  Often these companies are managed by staff with little or no experience in running a publicy traded firm.  Those who have had insight into this process know that running a public company versus private firm is another league entirely with another consituency(shareholders) to serve.  Why mess around with that stuff when there are so many good quality companies out there with established track records as public firms?Just one man's opinion....Interesting how Newbie never responded to this one....maybe he didn't have a good rebuttal?  Or too busy trading insults with Metellnoname? 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->
I'll put in a rebuttal.
If you participate in every deal and flip 30 or so days out, your average should be quite good. If you look at the average performance of all IPOs (www.ipohome.com), you will see that almost every bank's deals (on average) do quite well relative to their peer group. If you have the clientele (hedge funds, money managers), you can sell every deal and as much as you can get. They will buy into every deal and never complain.
Syndicate is very good business. There just isn't that much of it for most brokers.
In theory that sounds great.   But don't forget that for the 'hot' deals allocation is limited and yet for the dogs it's all you can eat.  I suspect that might hurt your real world returns.Too, with most firms if you keep flipping out of deals after 30 days you might see the syndicate department make a call to the branch manager to cut back your allocation, too! 
var SymRealOnLoad;
var SymReal;

Sym()
{
window.open = SymWinOpen;
if(SymReal != null)
SymReal();
}

SymOnLoad()
{
if(SymRealOnLoad != null)
SymRealOnLoad();
window.open = SymRealWinOpen;
SymReal = window.;
window. = Sym;
}

SymRealOnLoad = window.onload;
window.onload = SymOnLoad;

//-->
It depends upon the ratio of dogs to purebreads in your firm's pipeline. Dain Raucher is a little different from Credit Suisse. Most firms don't have a problem with flipping after a certain period of time. If you don't want the credit for flipping - then simply have the shares DTC-ed out. How many PIGS does a Merrill Lynch have anyway?

mrcl's picture
Offline
Joined: 2008-07-11

I had a friend who just interviewed with SB.  They provide a 2 year base, not 2.5.

IsOldSpiceRightForMe's picture
Joined: 2008-04-14

mrcl wrote:I had a friend who just interviewed with SB.  They provide a 2 year base, not 2.5.
 
Actually, it's full salary for months 1-24.  Months 25-30 salaries decline in equal decrements through production of month 30.  After that there's a minimum guaranteed monthly payment, determined by the state you're in.

runner999's picture
Offline
Joined: 2008-05-06

mrcl wrote: I had a friend who just interviewed with SB.  They provide a 2 year base, not 2.5.

This is not really correct. You get the full base while you are training. THEN, you get the 100% base for two years of production. So that right there does equal to 2.5 years of full base.

Then, you also get a declining base for months 25-30.

troll's picture
Offline
Joined: 2004-11-29

runner999 wrote: mrcl wrote: I had a friend who just interviewed with SB.  They provide a 2 year base, not 2.5. This is not really correct. You get the full base while you are training. THEN, you get the 100% base for two years of production. So that right there does equal to 2.5 years of full base. Then, you also get a declining base for months 25-30.
Runner is 100% correct.

mrcl's picture
Offline
Joined: 2008-07-11

As a new advisor, is it a good idea to join Morgan Stanley now?  Not sure if anything has changed in terms of comp, culture, etc. since this post was posted 2 years ago.  Any insight would be helpful.

lightship's picture
Offline
Joined: 2008-07-24

There are many great posts on here, thank you all for adding some insight, some of you just made me laugh!
 
I am curious if many of you would be willing to share. I am exploing an opportunity with SB, it is in the early infancy stage and I do not want to waste to much time. I have a great friend who recently moved his book from SB to a competing wirehouse after 7 years, he was hired into SB without any experience in this industry however had a healthy sales and buisness background. Seven years ago he negotiated a starting draw of $85K, he is under the impression that that number for a non FA, however mid career professional, could now be negotiated as high as $120K for the first 2.5-3 years. Can anyone validate this, or tell me what the real numbers are. I am located in So Cal, I am not sure if region matters.
 
THX

bullinachinashop's picture
Joined: 2008-07-18

i'm a mid-career professional and I was told by the VP that he would put my salary at 60K. Aslo, you should consider that the higher salary comes with a higher expectation to produce.

Please or Register to post comments.

Industry Newsletters
Careers Category Sponsor Links

Sponsored Introduction Continue on to (or wait seconds) ×