Edward Jones-Pushing Advisory & Performance

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broker4hire's picture
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It seems that Jones is trying to have it both ways.  They are spending tremendous amounts of money on the new "Advisory Solutions" investment platform.  As a Jones advisor I say it's about time that this platform was made available.
 
But at the same time they are coming out with a new performance program that would actually reduce the segment that an advisor was in if his performance fell.
 
Personally my branch is healthier that it has ever been.  I have seen a net increase in assets and clients through the down market.  Over the past few months I have busier than I have ever been.  The problem is that Jones is continuing to use the traditional measurement of my branch's health....the perfomance chart.  It appears to me that Jones is trying to have it both ways. 
 
No one else at Jones knows how to handle it either.  I have heard suggestions like, "do your first 20K in A-shares then use the fee based stuff"or "use A shares then convert them down the road" and many other variations of doing something to create a commission for the moment with the intent of using fee based for that same client later on.  Some of these suggestions have come from regional leadership or from individuals at the home office.
 
In my have never been at another firm but the way we have rolled this oput seems half thought out.  What happens elsewhere?

BigCheese's picture
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Joined: 2009-07-13

The client always comes first...after the first 20K...

 
I am sure Spiff will spin it so that we can hear the other side. Clearly broker4hire must be disgruntled...
 
Sound familiar?

SayNo2KoolAid's picture
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Over 90% of the money going into AS is from existing accounts.  We got the lecture at Summer Regionals from some heavy-hitting super-vets on how they are converting existing accounts to it at a rate of 1-2 accounts a day.  I asked one of them at a break how much new money was going in, and his answer was ZERO.  Even my wholesalers are laughing at what we are doing.

Don Draper's picture
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Joined: 2009-01-27

that firm is a joke

voltmoie's picture
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Joined: 2008-11-05

Tell me why it's a bad idea to move a client that bought A-Share American Funds 5-7 years ago to switch to Advisory Solutions.  Also, Jones provides REFUNDS to clients that switch to Advisory Solutions when it impacts them fee wise.  Not just your horsesh*t answer JONES IS A JOKE.  Why is Advisory Solutions a bad idea for them??If they came to you I'd bet everything I own that you'd stick that nice new shiny transfer in a WRAP account.  F UI think your lying about the "first 20k" in A-shares.  If not, you have an obligation to report this person.

Don Draper's picture
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Joined: 2009-01-27

I probably would sell a wrap, but not after having sold an A share. And Jones is a joke for so many other reasons.

voltmoie's picture
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So, what you are saying is you never adjust your clients holdings? Never adjust your strategy? However, if you inherit a clients holdings it's open season? Interesting.BTW:  you never answered my question, why is it a bad idea?  Especially considering the client will get a fee refund?

Don Draper's picture
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Joined: 2009-01-27

did the clients circumstance change or did yours? btw, Jones is a joke

voltmoie's picture
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You tell me, why would a wrap account benefit your NEW client and not my existing? Please don't call Jones a joke, it'll ruin my night.

Fooled No More's picture
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Joined: 2009-08-14

More Fee base! More $$ for the partners!!!! Yeah

LockEDJ's picture
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voltmoie wrote: ///  F UI think your lying about the "first 20k" in A-shares.  If not, you have an obligation to report this person.

Actually I thought of you when I read this line. It's not about putting the first $20K of a client's money into AS; it's the first 20K GDC. Which in fact is what you've purported to do, and I think it's a good thing.

Other people talking about EDJ's AS haven't been exposed to it. Compared to what I see out there, this program is far, far better than the competition. I've looked at what others have to offer, at the due diligence involved, the rebalancing and the manner in which clients are handled.

Our plan is better, and even as myself being a potentially outbound Jones guy I find others calling this company a "joke" as being completely unprofessional, and unworthy of direct rebuttal.

By the end of September, I will have five clients on it. By October, 15. I have a list of clients with more than $50K, that have been clients for a reasonable time and who haven't paid any recent commissions on the account. If they are concentrated in mutual funds, this is a better deal for them. Period. End of discussion.

Moraen's picture
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Joined: 2009-01-22

Automatic rebalancing is NOT good, especially for non-qualifiied money. Most of my clients have non-qualified money.

As for selling A-shares and then putting someone in advisory - it is better than switching someone out of American Funds and into Franklin a few years later, but still a little suspect.

If A-shares are "in your client's best interest", then why would you put them in Advisory after selling them A-shares. Has the Jones philosophy changed? No.

I hate to say it, but in this case Windy/Ronnie is acting the most ethical. He doesn't see it that Advisory is better than A-shares. He is still sticking with Jones philosophy (no matter how changed it is).

Lock - I agree with a lot of what you say, but I personally don't think that AS is such a good plan. You say it's cheap, but all-in it's still pretty expensive. Plus, the models are flawed (at least when I was there).

AS is set up the way it is for one reason - to limit liability of the home office. I don't think it's a BAD plan - but it could be better. And the whole philosophy of getting people in A-shares and then converting them - hogwash. These long-term brokers that are now wrapping their 100, 200, and 300 million dollar books. If they thought wrapping the money was in the clients' best interests, why did they not leave?

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A b
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broker4hire wrote: "use A shares then convert them down the road" and many other variations of doing something to create a commission for the moment with the intent of using fee based for that same client later on.  Some of these suggestions have come from regional leadership or from individuals at the home office.

wow.    
your a branch manager?
JD Powers awards?    

A b's picture
A b
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Moraen wrote: Automatic rebalancing is NOT good, especially for non-qualifiied money. Most of my clients have non-qualified money.

As for selling A-shares and then putting someone in advisory - it is better than switching someone out of American Funds and into Franklin a few years later, but still a little suspect.

If A-shares are "in your client's best interest", then why would you put them in Advisory after selling them A-shares. Has the Jones philosophy changed? No.

I hate to say it, but in this case Windy/Ronnie is acting the most ethical. He doesn't see it that Advisory is better than A-shares. He is still sticking with Jones philosophy (no matter how changed it is).

Lock - I agree with a lot of what you say, but I personally don't think that AS is such a good plan. You say it's cheap, but all-in it's still pretty expensive. Plus, the models are flawed (at least when I was there).

AS is set up the way it is for one reason - to limit liability of the home office. I don't think it's a BAD plan - but it could be better. And the whole philosophy of getting people in A-shares and then converting them - hogwash. These long-term brokers that are now wrapping their 100, 200, and 300 million dollar books. If they thought wrapping the money was in the clients' best interests, why did they not leave?

wtf
Im having a 1984 acid flashback

A b's picture
A b
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LockEDJ wrote: Compared to what I see out there, this program is far, far better than the competition. I've looked at what others have to offer, at the due diligence involved, the rebalancing and the manner in which clients are handled.

Our plan is better, and even as myself being a potentially outbound Jones guy I find others calling this company a "joke" as being completely unprofessional, and unworthy of direct rebuttal.

Your firm is like Waco or sceinctology or something
Wait till you get debriefed in the real world
you will understand

broker4hire's picture
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A b wrote: broker4hire wrote: "use A shares then convert them down the road" and many other variations of doing something to create a commission for the moment with the intent of using fee based for that same client later on.  Some of these suggestions have come from regional leadership or from individuals at the home office.
wow.     your a branch manager? JD Powers awards?    
 
This has caught a lot of people off guard.  They don't know what to do.  They want us to use Advisory and cheer us on for putting $1 billion in every eight days, but they ultimately want us to do it without our production dropping below $18k p/mo.  In normal circustances..no problem.  But I have to admit that I have been a little closer than I am comfortable with to that line throughout this market...and that is with A-shares.  Now that Advisory is a large part of my business that number has dropped to about $16K to $17k p/month.  And that is only because it has been VERY busy in the muni, VA and fixed annuity side.  No one is giving me any hassles yet...but I know that if I continue down this path they will. 
 
At this point I would like to get my production up some.  Do I lower myself?  Do I use A-shares for a client when I feel that Advisory is a better fit for them?  Do I just not tell some clients about the wrap model and only tell them about A-shares?

CashFlow's picture
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Here is the bottom line.  Either you are committed to the fee based model or you are committed to the A share model.  You really can't have it both ways.  I converted my book over 7 years ago to fee based and almost never do an "upfront" sales charge.  The only exception is that I did 2 trades where we hit the million dollar breakpoint, but even then I think by having diversified money managers is far better than one fund family.  When will
American funds be the next Putnam?
 
The comment that was made that Jones has the best fee based model is simply amazing.  You have never looked at one other program if you truly believe that.  The Jones fee based model is truly behind the times and there are far better available in the marketplace.  Go kick some tires at other firms and it will become apparent that you have been drinking the Kool-Aid far too long.

voltmoie's picture
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I have no moral dilemma.  If the client has over 50k in qualified money they are either going into AS or a B-share VA with an income rider.  I think AS for qualified is terrific but dangerous for NQ.I'd also be able to sleep just fine at night if I were a vet were moving my existing clients into AS.  ML, MSSB, Wachovia did the same thing when their wrap programs hit. The fee recovery system put into place by Jones safegaurds the clients from taking a hit. You can argue the merits of AS all you want but from the ethical end, get real.

SayNo2KoolAid's picture
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Well I certainly DO have a problem with the mass conversion of existing accounts to AS.  I've been with Jones over 10 years, and I've heard almost 10 years of lectures of how "evil" these accounts are.  Now that Weddle thinks of it, they're suddenly great?  We used to be trained how to sell AGAINST these things.
 
So did all the vets who are now converting existing accounts feel like they were selling inferior products back then?  Were they too stupid to understand other firms' wrap products at the time?  If they are so great, then why is almost every penny going in these things OLD MONEY?????

voltmoie's picture
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Do you have any proof that ALMOST every penny going into AS is old money?  Other than the 100ft view from your office? If so, give us the FFAACCTTSS  not your BS opinion.Why do you live in the past?  Microsoft used to think the internet had no commercial application outside of ISP.  Guess their employees should quit now because they continue to make a push into that industry.  Times change, adjust and move on.  Seems like Jones is doing that ... why are you not?

SayNo2KoolAid's picture
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The figures came from the GP at our Summer Regional (told over dinner).  Told us over 90% is old money.  My "BS opinion"?  Grow up.  I'm assuming you are under 30.
 
Put down the Kool Aid if you think Jones is trying to "change" and "adjust" to the future.  They've uncovered a new income stream.  Don't worry - I used to buy into everything they did as well ... you'll outgrow it.

broker4hire's picture
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SayNo2KoolAid wrote:Well I certainly DO have a problem with the mass conversion of existing accounts to AS.  I've been with Jones over 10 years, and I've heard almost 10 years of lectures of how "evil" these accounts are.  Now that Weddle thinks of it, they're suddenly great?  We used to be trained how to sell AGAINST these things.
 
So did all the vets who are now converting existing accounts feel like they were selling inferior products back then?  Were they too stupid to understand other firms' wrap products at the time?  If they are so great, then why is almost every penny going in these things OLD MONEY?????
 
I haven't been around quite as long as you but I do see the fallacy in using one fund family for 75% of your mutual fund business.  That may not be you, but that is the firm average.
 
Try this simple exercise.  Go back and look at the Barron's rankings of mutual fund families.  They have been doing this report since 1996 so we have some a short term history.  While their method may not be perfect it certainly gives us a good idea of how the fortunes of mutual fund companies rise and fall.  Specifically look at the 5 & 10 year rankings.  There are a couple that are still in the top 10 that were in that place then....but only a handful.  Ten years from now...who knows? 
 
Maybe these vets are seeing that the advisory program offers very, very few of the "preferred funds".  Maybe they are seeing that large cap value underperformed mid cap and small cap last year.  Maybe they are wanting to offer a higher level of diversity to their clients.  Maybe their position resembles that of John Maynard Keynes.  "When the facts change, I change my mind. What do you do, sir?"
 
I have no problem in converting current clients if this program is right for them.  I do have a problem in using A-shares now and converting them later.
 
The only group that can afford to really put new money into this platform are the vets that can get 20-30k into it from current money pretty quick and then not worry about the commission from new money because their month will be ok.
 
The main issue that I have is that Jones expects our production to stay up but they want us to use this as well.  I feel like walking into Weddle's office and yelling at the top of my freakin lungs "WTF are you thinking!!!"

Moraen's picture
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In volt's defense, I think he is over 30.

However, the vets who are converting their books to AS are a big problem. The reason is as others have pointed out. Where were these vets two years ago? Answer: They were saying wrap programs were all bad.

And now that Jones has one - well it must be great because Jones designed it!

Give me a break. Look. I no longer have hate-filled Jonesitis, but you have to look at it clearly. If A-shares are the best two years ago, what's changed?

Jones will tell you nothing right? It's never "different". Except when they want to make an extra buck.

SayNo2KoolAid's picture
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And you didn't answer my question ..
 
Why are they great now, but were evil 3 years ago?
If they are so great, why isn't the new money going in them? 
Over 90% is very telling .. WHY IS IT NOT GOOD ENOUGH FOR NEW MONEY?

Moraen's picture
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broker4hire wrote: SayNo2KoolAid wrote:Well I certainly DO have a problem with the mass conversion of existing accounts to AS.  I've been with Jones over 10 years, and I've heard almost 10 years of lectures of how "evil" these accounts are.  Now that Weddle thinks of it, they're suddenly great?  We used to be trained how to sell AGAINST these things.
 
So did all the vets who are now converting existing accounts feel like they were selling inferior products back then?  Were they too stupid to understand other firms' wrap products at the time?  If they are so great, then why is almost every penny going in these things OLD MONEY?????
 
I haven't been around quite as long as you but I do see the fallacy in using one fund family for 75% of your mutual fund business.  That may not be you, but that is the firm average.
 
Try this simple exercise.  Go back and look at the Barron's rankings of mutual fund families.  They have been doing this report since 1996 so we have some a short term history.  While their method may not be perfect it certainly gives us a good idea of how the fortunes of mutual fund companies rise and fall.  Specifically look at the 5 & 10 year rankings.  There are a couple that are still in the top 10 that were in that place then....but only a handful.  Ten years from now...who knows? 
 
Maybe these vets are seeing that the advisory program offers very, very few of the "preferred funds".  Maybe they are seeing that large cap value underperformed mid cap and small cap last year.  Maybe they are wanting to offer a higher level of diversity to their clients.  Maybe their position resembles that of John Maynard Keynes.  "When the facts change, I change my mind. What do you do, sir?"
 
I have no problem in converting current clients if this program is right for them.  I do have a problem in using A-shares now and converting them later.
 
The only group that can afford to really put new money into this platform are the vets that can get 20-30k into it from current money pretty quick and then not worry about the commission from new money because their month will be ok.
 
The main issue that I have is that Jones expects our production to stay up but they want us to use this as well.  I feel like walking into Weddle's office and yelling at the top of my freakin lungs "WTF are you thinking!!!"

What facts have changed? And I don't understand how you can be a Keynsian at Jones. You might get fired for that.

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Thats a great question.  I'm glad you asked.
(1)Three years ago we did not have it available.
(2)My new money IS going into it. (thus the 16k months)
(3)See #2

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broker4hire wrote: Thats a great question.  I'm glad you asked.
(1)Three years ago we did not have it available.
(2)My new money IS going into it. (thus the 16k months)
(3)See #2

Ah, so we get to it. They were evil three years ago because JONES did not have them. Now it all makes sense!

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I'M NOT SAYING WRAP ACCOUNTS ARE BAD.
 
I'm just saying that when it's nearly all old money, you have to be blind not to see what's happening.
 
If this product is appropriate for old money it's appropriate for new money.  If we are barely using it for new money (when it IS great for old money), then we are putting our new clients into an inferior product to earn a much larger commission, and we should be ashamed.  But if we are doing the right thing for our new clients by putting them in A shares, then we are churning our older clients, and we should also be ashamed.
 
We can't have this both ways. 

broker4hire's picture
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  What facts have changed? And I don't understand how you can be a Keynsian at Jones. You might get fired for that.
 
The only fact that I can see that has changed is that we are told from day one to use the preferred funds.  Now with vast knowledge and wealth of experience I realize that a .25% trail is not enough.  I want at least 1.25%.  That appears to be the only answer that many "haters" will believe.  So there it is.
 
As to being a Keynsian.  The last time I brought up the word Keynsian at a meeting someone told me to delete those emails....it was a scam.  

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broker4hire wrote:   What facts have changed? And I don't understand how you can be a Keynsian at Jones. You might get fired for that.
 
The only fact that I can see that has changed is that we are told from day one to use the preferred funds.  Now with vast knowledge and wealth of experience I realize that a .25% trail is not enough.  I want at least 1.25%.  That appears to be the only answer that many "haters" will believe.  So there it is.
 
As to being a Keynsian.  The last time I brought up the word Keynsian at a meeting someone told me to delete those emails....it was a scam.  

Not hating, but Jones has been doing this quite a while, and a lot of vets have been doing it a while too. Before I left, they were talking about AS. My regional leader at the time talked about how he was going to take his $270 million and put it all in AS. Nice pay day, but what the hell?

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SayNo2KoolAid wrote:The figures came from the GP at our Summer Regional (told over dinner).  Told us over 90% is old money.  My "BS opinion"?  Grow up.  I'm assuming you are under 30.
 
Put down the Kool Aid if you think Jones is trying to "change" and "adjust" to the future.  They've uncovered a new income stream.  Don't worry - I used to buy into everything they did as well ... you'll outgrow it.I'm over 30, not a kool-aid drinker, and I'm not going to stand by and watch people pass their "opinions" off as facts.  So bust out those real figures buddy.Best part about this argument is if Jones didn't have Advisory Solutions you same clowns would be bitching about us not have a fee based product. 

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Those were as specific as I was given.  Didn't ask him for $$ amounts (didn't care).  Call the AS team in St. Louis tomorrow and ask them!
 
Funny - I didn't "bitch" about not having a fee based product for the past 13 years!  And if you are really over 30, try corresponding like one.  "FU" and "horsesh*t" comments make you sound like a teenager.  As I previously stated, you'll tire of Kool Aid and grow up one day.

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Here's an example of something I heard before I left. "We still believe A-shares are in the best interest of our clients, Advisory Solutions is another arrow in our quiver".

And volt - the same people defending AS and saying it was a good thing, were the same people talking about how bad they were for clients. "Wrap" was always said in a derisive and condescending tone, as if it were the worst thing possible for a client. We all learned to sell against it.

You weren't there at the time, so I'm not sure you have a frame of reference as to what some of the vets were talking about.

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[You weren't there at the time, so I'm not sure you have a frame of reference as to what some of the vets were talking about.
 

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AGEMAN wrote:
So that is the only fee based platform Jones has is one mutual fund platform.  Do they allow you to choose the funds, or is it only company models??
I don't want to sound condescending, but how does this program make the advisor any different than a 401(k) rep visiting an employer, meeting w/the employees for 10 minutes each and doing a risk questionnaire before determining "Employee A, you're risk tolerance appears to be Moderately Aggressive.  Therefore, you should invest in the Moderately Aggressive model within the company-selected funds."

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broker4hire wrote:
Thats a great question.  I'm glad you asked.
(1)Three years ago we did not have it available.
(2)My new money IS going into it. (thus the 16k months)
(3)See #2
 
broker4, Nice Hamburger bud! Hahah

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Moraen wrote:
You weren't there at the time, so I'm not sure you have a frame of reference as to what some of the vets were talking about.I certainly do. I have ears, they have voices.  We've used both to
discuss this.  We can use this exact logic for all the ex-Jones posters
going forward if you'd like.  They have NO FRAME of reference to make
any comment on what the firm is currently doing, which includes you SOOOOOOOO, I think all Non-Jones employees should not post anything about this going forward.  Fair?

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voltmoie wrote:

Moraen wrote:
You weren't there at the time, so I'm not sure you have a frame of reference as to what some of the vets were talking about.I certainly do. I have ears, they have voices.  We've used both to
discuss this.  We can use this exact logic for all the ex-Jones posters
going forward if you'd like.  They have NO FRAME of reference to make
any comment on what the firm is currently doing, which includes you SOOOOOOOO, I think all Non-Jones employees should not post anything about this going forward.  Fair?

Actually, that is fair. However, because I was there I have a frame of reference when you guys talk about what is going on now.

For instance, if you say all of the sudden that you guys have started using financial planning software based off of MoneyGuidePro, I can understand that and say, "Wow, because that Sungard crap was garbage, they must really be putting the advisors first here.".

Because you don't actually know what it was like BEFORE, and didn't experience it, you can't. I can talk about what it was like before compared to what current Jones people talk about. And by the way, you'll never hear me say, "I talked to a buddy I have at Jones (I only have one left) and he told me blah blah blah". I will say, "Volt, if that's what they are doing then that is blah blah blah". And if nothing has changed, then I can also comment on that.

Since you don't know what it was like BEFORE AS was implemented (read: You've always had it available), then you can't comment on what it was like before.

I was there before and after it was implemented. Has it changed? You bet. That's why I always ask questions like, "Hey LockEDJ, is that including all mutual fund expenses as well?".

Just sayin'.

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Your right, i did go through the same process of converting to fee based.
(excpect Tawne Katane was on the hood of a car in that White Snake video and Doug Plank was playing Safety for the Bears ).

A fee base based advisory business is the only way to do the right thing for people all the time and leverage your time to get off always having to get new business constantly every freaking month
Sure its ok to convert as long as there are no monster cap gains.
The BEST way to run your advisory business is through a wrap fee that you run your self. (gpm, pim,pmp, pia whatever).

Your firm is in a time warp. seriously   

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Moraen wrote: ...

Lock - I agree with a lot of what you say, but I personally don't think that AS is such a good plan. You say it's cheap, but all-in it's still pretty expensive. Plus, the models are flawed (at least when I was there).

...

I'm not all the way out of Jones, but my looking tells me that to get a solution with the due diligence of third parties gets to be pretty darn expensive. We can present ours anywhere from 1.35 to 70 bps. I look at the costs of working with someone like Lockwood or a SMA and think woosh, that's a whole lotta bps. If you want someone to manage money for you for around 1.25% and the FA is outsourcing it ... well, I dunno.

Could it be better? Perhaps but I don't think so within the framework of Jones. After all, how can you introduce alternative investments into the AS world and not make them available in some form outside AS? Insofar as liability goes, one of the FAs has pointed out that we've moved to a point now where the Jones FA is at greater risk than before. Interesting ideas.

Tired. Happy both the Bills and Jets won today.

G'nite,
Alex

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I thought this might turn into a conversation about the merits of Advisory and it has but my questions have gone unanswered.  Let me re-phrase them.
If you could afford to go without a paycheck or much of one do you think it would be worth it to do nothing but wrap accounts for a year?  Even if your firm may fire you for lack of performance?  And yes, Jones would.  (Remember they still want it both ways)
 
For the first time I feel restricted by Jones.  I have never felt that the parameters they put around the way I operate my practice have had much of an impact on me.....until now.
 
 

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Your questions are spot on which is why it really only works to go full advisory fee based when you are Indy and don't have to worry about hitting a monthly production goal as long as you are viable over time. Jones is conflicted as hell and they are once again putting the guys in the middle of the pack in a dilemma.

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LockEDJ wrote: Moraen wrote: ...

Lock - I agree with a lot of what you say, but I personally don't think that AS is such a good plan. You say it's cheap, but all-in it's still pretty expensive. Plus, the models are flawed (at least when I was there).

...

I'm not all the way out of Jones, but my looking tells me that to get a solution with the due diligence of third parties gets to be pretty darn expensive. We can present ours anywhere from 1.35 to 70 bps. I look at the costs of working with someone like Lockwood or a SMA and think woosh, that's a whole lotta bps. If you want someone to manage money for you for around 1.25% and the FA is outsourcing it ... well, I dunno.

Could it be better? Perhaps but I don't think so within the framework of Jones. After all, how can you introduce alternative investments into the AS world and not make them available in some form outside AS? Insofar as liability goes, one of the FAs has pointed out that we've moved to a point now where the Jones FA is at greater risk than before. Interesting ideas.

Tired. Happy both the Bills and Jets won today.

G'nite,
Alex

Lock .70 to 1.35 ALL-IN? Does that include any mutual fund expenses?

SometimesNowhere's picture
Joined: 2008-12-22

Moraen wrote: LockEDJ wrote: Moraen wrote: ... Lock - I agree with a lot of what you say, but I personally don't think that AS is such a good plan. You say it's cheap, but all-in it's still pretty expensive. Plus, the models are flawed (at least when I was there). ... I'm not all the way out of Jones, but my looking tells me that to get a solution with the due diligence of third parties gets to be pretty darn expensive. We can present ours anywhere from 1.35 to 70 bps. I look at the costs of working with someone like Lockwood or a SMA and think woosh, that's a whole lotta bps. If you want someone to manage money for you for around 1.25% and the FA is outsourcing it ... well, I dunno. Could it be better? Perhaps but I don't think so within the framework of Jones. After all, how can you introduce alternative investments into the AS world and not make them available in some form outside AS? Insofar as liability goes, one of the FAs has pointed out that we've moved to a point now where the Jones FA is at greater risk than before. Interesting ideas. Tired. Happy both the Bills and Jets won today. G'nite, Alex Lock .70 to 1.35 ALL-IN? Does that include any mutual fund expenses?
 
No.

LockEDJ's picture
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Joined: 2009-07-06

Hold on, Morean ... miscommunication. Chalk one up under the category, "Don't post while you are tired."
 
No, I meant that the AS can be pushed out to clients as low as 70 bps. We don't have Lockwood, but I see the administration fees a BD puts around them + the fees from Lockwood + the advisor's take, and I that seems incredibly expensive. My point being, the Jones AS offers due diligence and third party administration at generally above 1; what I see from BDs that offer due diligence and third party admin seems to be closer to 2.
 
I'm very willing to be corrected on the percentages. Don't tell me about your own due diligence or you're great manner of dividing and conquering the market; most FAs are and should remain salesmen. Let's match an apple with an apple, and I do believe the Jones AS is inexpensive. Educate me on how I am wrong.
 
FWIW, for one of my clients, in a classic 70-30 AS solution, has experienced a 19% return YTD net of fees. I have no issue with those returns, so to say their solutions are flawed ... I think you have a hard time. This is substantially better than let's say the S&P Growth Allocation offered through iShares (in fact, it's better than any asset allocation offered through iShares on a YTD basis.)
 
With due respect,
A.

Moraen's picture
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Joined: 2009-01-22

LockEDJ wrote: Hold on, Morean ... miscommunication. Chalk one up under the category, "Don't post while you are tired."
 
No, I meant that the AS can be pushed out to clients as low as 70 bps. We don't have Lockwood, but I see the administration fees a BD puts around them + the fees from Lockwood + the advisor's take, and I that seems incredibly expensive. My point being, the Jones AS offers due diligence and third party administration at generally above 1; what I see from BDs that offer due diligence and third party admin seems to be closer to 2.
 
I'm very willing to be corrected on the percentages. Don't tell me about your own due diligence or you're great manner of dividing and conquering the market; most FAs are and should remain salesmen. Let's match an apple with an apple, and I do believe the Jones AS is inexpensive. Educate me on how I am wrong.
 
FWIW, for one of my clients, in a classic 70-30 AS solution, has experienced a 19% return YTD net of fees. I have no issue with those returns, so to say their solutions are flawed ... I think you have a hard time. This is substantially better than let's say the S&P Growth Allocation offered through iShares (in fact, it's better than any asset allocation offered through iShares on a YTD basis.)
 
With due respect,
A.

19% seems a little on the low side YTD, but if you say it's working, then I believe you. Who sits on the Advisory Solutions board? Are they Jones people? That's who it would be when I left. These are the same people who were saying Lehman wasn't going bankrupt, yes?

B24's picture
B24
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Joined: 2008-07-08

Guys, this conversation is getting a little silly.
 
Bottom line, Jones rolled out their first advisory platform one year ago.  As with all things "Jones", they will start out slow and make modifications as they go.  I know they already have another several models that they are rolling out by year-end, and will likely make more modifications as we go forward.  They are working on addressing the whole "production goals" thing as it relates to AS, as to make it more attractive for new assets.  My belief is that they WANTED existing assets going into it first, so they they could basically test out the concept with more seasoned veterans before letting the whole firm go hog-wild.
 
As far as the rigidity of the platform, I believe that Jones is doing this to cover their fiduciary a$$es, and make sure they tightly control it in the beginning.  My guess is that they become more flexible as time goies on.  I bet at some point they allow individual securities.  Now, this will likely start out as the "model portfolio" and some sort of pre-constructed bond ladder or something, but again, baby steps.  Jones is never at the cutting edge.  We should just accept it for what it is right now, and understand that it will improve as time goes on.

RealWorld's picture
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Joined: 2009-07-13

I am a Jones guy and I can't believe anyone would sit here and say that it is fine to move money into the AS from old A share money unless they are willing to say that their philosophy has changed.
 
I also do not think Ejones is a joke, however about 30% of their brokers are. Are we really this ignorant to call each other names or argue back with JD Power award and we manage money!!!
 
Anyway this is a huge problem at Jones. If I am not a bad broker who is taking old money and converting it, then like others on here I am only doing it with new money.
 
I have not found a way to make it work yet and the idea of putting 20K in a 5% load and the rest in AS is SICKENING. And non defensable.
 
EX: I put 375 in AS and had a horrible June 9K gross. My RL called and asked "what happened, did I take the month off? ha ha.. ".
 
Lastly, we SHOULD all know by now that one way is not always the best. For some people AS is good, for some people load funds are good, for some situations VAs are good, for some C shares are good.
If you are saying I ONLY do XYZ then you are probably not all that good at financial advise.
 

3rdyrp2's picture
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Joined: 2008-11-13

LockEDJ wrote:FWIW, for one of my clients, in a classic 70-30 AS solution, has experienced a 19% return YTD net of fees. I have no issue with those returns, so to say their solutions are flawed ... I think you have a hard time. This is substantially better than let's say the S&P Growth Allocation offered through iShares (in fact, it's better than any asset allocation offered through iShares on a YTD basis.)
 
With due respect,
A.
 
Uggghhh...19%...here's my company's 100% proprietary moderate aggressive allocation fund, in a 66/34 model.  FWIW, no one here uses the fund because its a joke, unless the client is opening up a roth or something w/$2,000, and its still up 23%.  A lazy sloth could put together a moderately aggressive portfolio this year that has earned at least 25%. 
 
http://www.google.com/finance?q=NASDAQ%3AAXMAX

GoodTimes's picture
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Joined: 2006-05-08

yep, investment management should be left to professionals.  Does the Edward Jones Investment Policy Committee still made up of 0 CFAs, 1 dude with an MBA and 7 former INVESTMENT REPRESENTATIVES housed out of the mutual fund catered HQ?  What a joke, when I was there "asset allocation" asset classes were dubbed Income, Growth and Income, Growth and Aggressive Growth.  Did Dave Ramsey set that up?  I can see why DR would, he's talking to millions of people on free radio, but EDJ?  A rep is supposed to select the underlying funds in those categories while understanding risk?  It should be cheap, its made up of uneducated jokers that eat mutual fund food from HQ (not so dissimilar from other companies).

LockEDJ's picture
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Joined: 2009-07-06

Moraen wrote: ...Who sits on the Advisory Solutions board? Are they Jones people? That's who it would be when I left. These are the same people who were saying Lehman wasn't going bankrupt, yes?
 
Well ... you got me there . At least it's not me doing the pickin' and grinnin'.
 
I'm curious though as to whether or not anyone sees this as an expensive solution.

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