Jones managed accounts
Anyone know if Jones ever made progress on this? When I left they were talking about it, but I have heard not a word since then. I would imagine they decided charging huge loads was more profitable, but always nice to try and stay current…
Projected launch is this year around Summer Regionals.
Is everyone in agreement it will be fund only?
Wouldn’t that defeat the purpose of SMA’s…
ETFs also. Finally. And no, they finally realize that recurring revenue is MORE profitable–the new 5 year plan even tracks the projected (large) growth of recurring fee revenue. Better late than never; better late than launched poorly.
I left Jones yesterdayReally…where’d you go? Regional? Wirehouse? Indy? Out of business?
Congratz, newnew!
indy-sharing an office (Schwab Instit)
It seems like the same thing was discussed last year…and the year before that. If there is not an additional level of measurement/monitoring by a different authority from the broker, then you might as well be using C shares. You can build a “wrap acct” around as many fund families you want. To me a true managed mutual fund acct means that you have some level of management monitoring the funds w/in an allocated model–unless the broker is responsible for knowing dozens of different funds and re-balancing.
Nobody said they were doing SMA’s correct? I assume it will be more of a fund wrap account than anything else.
There’s already an SMA platform on the Jones system. The minimum account size is $500K.
My understanding of the management part of the equation is that the FA is going to have a choice of using Jones Models or building them himself. That's the way they do it now with our annuity vendors, so I'd assume it would look similar.I heard the other day that the top producers are getting it in late March… may be they said late May… Then aprox. two months later the rest of us get it. I was under the impression that it was only going to be funds then adding more later. (this was the update by my area leader at our Spring regional)
Miss JWe are definitely getting it near the mid/end of summer. They have committed to it already. You will have to build asset allocation models (with a broad range of load,no-loads, and ETF's), document annual reviews, etc. Part of the reason behind not including stocks & bonds at this point is (1) getting advisors used to the model and (2) there is an additional system platform required for stocks & bonds. They will be adding that piece down the road.It seems like the same thing was discussed last year…and the year before that. If there is not an additional level of measurement/monitoring by a different authority from the broker, then you might as well be using C shares. You can build a “wrap acct” around as many fund families you want. To me a true managed mutual fund acct means that you have some level of management monitoring the funds w/in an allocated model–unless the broker is responsible for knowing dozens of different funds and re-balancing.
Well that pretty much destroys the major benefits of SMA’s then doesn’t it…
[quote=Broker24]
We are definitely getting it near the mid/end of summer. They have committed to it already. You will have to build asset allocation models (with a broad range of load,no-loads, and ETF's), document annual reviews, etc. Part of the reason behind not including stocks & bonds at this point is (1) getting advisors used to the model and (2) there is an additional system platform required for stocks & bonds. They will be adding that piece down the road.[/quote]Are you sure that you will have to build asset allocation models yourself, 24? With last year's vacating of the B/D Exemption Rule, about the only wrap programs you'll find now are discretionary 'advisory programs' that only gives you a choice of which pre-built asset allocation model to choose.
Or did I misunderstand you?
[quote=Morphius] [quote=Broker24]
We are definitely getting it near the mid/end of summer. They have committed to it already. You will have to build asset allocation models (with a broad range of load,no-loads, and ETF's), document annual reviews, etc. Part of the reason behind not including stocks & bonds at this point is (1) getting advisors used to the model and (2) there is an additional system platform required for stocks & bonds. They will be adding that piece down the road.[/quote]Are you sure that you will have to build asset allocation models yourself, 24? With last year's vacating of the B/D Exemption Rule, about the only wrap programs you'll find now are discretionary 'advisory programs' that only gives you a choice of which pre-built asset allocation model to choose.
Or did I misunderstand you?
[/quote] To be honest, I'm not sure exactly how they will have to be built. Since it has not been formally introduced, our Managing Partner has said it will involve asset allocations and you can choose from many fund families including no-loads and etf's. I am para-phrasing, as I can't remember where to look for his comments, but it was something like that. The sense I got was that you would have to use Jones-built models, but choose your own funds within the categories. This would be perfectly acceptable to me. It just puts stronger weight on making sure you have the "client objectives" correct, so you can use the correct model. To me, that's sort of what an Advisory Account should be, not just "here's some investments, now pay me 1% every year." But you are correct, I did not mean to state that we would have to actually create the allocation models ourselves - they would be the Jones models.
SMA's are different. We have a separate SMA platform for individual stocks/bonds.Well that pretty much destroys the major benefits of SMA’s then doesn’t it…
Did Jones ever come up with a method to allow a junior rep to “buy” a senior reps book when he retires? They were “discussing” this in '02.
How long did it take to get "email"? This too was a "major" jones issue. Did I hear ETFs?? Wow, Jones had told us how ETFs "were not in the best interest of the client", nor were Managed accounts, or anything but A class funds. (And the ones from the preferred list at that.) It will be interesting to see what jones allows.[quote=GoneIndy02]Did Jones ever come up with a method to allow a junior rep to “buy” a senior reps book when he retires? They were “discussing” this in '02.
YES. THERE IS A 3 YEAR TRANSITION PROGRAM, WHERE THE GROSS ESSENTIALLY SHIFTS FROM THE RETIRING BROKER TO THE JUNIOR BROKER, AND THE RETIRING BROKER DOESN'T REALLY HAVE TO WORK MUCH. How long did it take to get "email"? This too was a "major" jones issue. WELL, UNTIL SOMETIME IN 2006. Did I hear ETFs?? Wow, Jones had told us how ETFs "were not in the best interest of the client", nor were Managed accounts, or anything but A class funds. (And the ones from the preferred list at that.) WE CAN CURRENTLY BUY ETF'S. THERE IS NO PROHIBITION ON THEM. It will be interesting to see what jones allows. [/quote]I got some additional info at my Spring Regionals. There will be two ways to build portfolios. One is to just use the Jones premixed models. Two will be to set up your own portfolios using the list of available funds. You must use a risk tolerance questionairre. Annual reviews are mandatory and the client will have to sign off on them. Only 30% of the funds in the “Advisory Solutions” program will be preferred funds. Automatic rebalancing is standard. There will be ETFs, no load funds, and load waived funds. Fees will be paid monthly and charged to the client monthly. No word on the cost.
Overall, I'm excited about the program. I don't think I've given more info than was already known, but it's nice to get confirmation. I know some other details that are also exciting, but I'll hold on to the info for now. More to protect the GP who was doing the telling than anything else.Will autorebalancing be mandatory in taxable accounts?
I believe it will be for all accounts. I’ve heard the phrase automatic rebalancing numerous times, but I’ve never heard anyone ask if it is mandatory or not.
Before you start bashing about the taxes, there will be a tax efficient portfolio available for taxable accounts. That's the only thing I've heard.As I know little about how your program will be built, please forgive me if I am way off base, but at face value I fail to see how this will benefit your clients. They can build a C share portfolio and buy individual etf’s just as easily. You still won’t have tax harvesting ability, or individual cost basis on holdings or many other of the benefits of a true SMA. You will still have the year end capital gains issues within the funds. So the question needs to be asked, is that type of program benefiting the client or Jones? Once again, I don’t have the specifics of your program, but from what I have read on this thread, it is a legitimate question.
It is a legit question. However, it is one that we may not have the answers for as of yet.
It isn't an SMA platform. They've never touted it be that. We have an SMA platform already. This isn't designed to replace it. I would guess that we will have cost basis on individual holdings within the platform. I can't imagine the trouble Jones would get into if they launched a program and then didn't support the tax portion of it. Like I said before, there will be a tax efficient platform for NQ assets. If they have $500K or more and want all the things you just listed, we can use the SMA platform. Benefits to clients - Broader diversification than just one or two fund families. Specific reco's based on defined risk tolerance (which I know is supposed to happen now, but doesn't really happen well). Auto rebalancing on a consistent basis. This is going to happen whether the FA or client knows it is going to happen or not. There doesn't have to be a quarterly phone call and decisions made by clients or FAs in order for it to get done. Client gains flexibility. If he wants to use a custom mix of funds and ETFs, great. If he wants to go with what Jones recommends, great. It's like buying a Strategy portfolio fund from Goldman, but getting to decide that you don't want to do the R/E fund and replace it with something else. It also gives them another pricing option. I'd bet that all Jones FAs have missed some good accounts because we don't have a fee based pricing option. No matter how much we say A shares are the cheapest way, there's 10 magazines out there saying don't do anything but fee based. This one will in the long run bring more clients into Jones, therefore benefitting the client, the FA (recurring revenue), and Jones (again with the recurring revenue).hmmmm…I’ll hold my opinion on it until I see it in action, but it doesn’t seem to be that great of a platform. There are plenty of true quality SMA’s out there with minimums as low as 25-50k. There are plenty of asset allocation funds out there that reallocate all on their own. Finally their are VA’s (not that I am a proponent of VA’s) that allow for multi-fund diversification. It’s nice that they are finally including ETF’s. When I was at Jones I got an FSpend just about every time I sold one to a client. I was told that ETF’s were for short term traders and not appropriate for Jones clientele. Still I am a little skeptical about how well the whole thing will come together…
New-Indy,
First off, C shares are not a catch-all for managed money. And they are limited in amount. The Mutual Fund Advisory Program will be for 100K minimums. We have SMA’s for tax management. We have C shares for under 100K (technically you can go up to 250K). It sort of answers the advisory account issue. And on top of that, they will be adding individual securities to it down the road. They just need to be sure it gets rolled out correctly.
The way I picture advisory accounts for me in the future: C shares up to 100K, Mutual Fund Advisory for over 100K, and SMA’s for significant non-qualified money. We also have A shares and individual stocks, bonds, CD’s, annuities, etc. It’s not as complete as most brokerage firms, but it gets the job done. I don’t know of many clients that have needs beyond that. I am not running in the Ultra HNW arena (nor are 99.9% of the people on this board), so I don’t have much need or desire for other products.
Well I guess that makes sense. I think I have a total of maybe 5 clients that even own a mutual fund. Guess that’s why I left Jones, just not my focus. I prefer the programs I have access to compared to what I have read here, but if it works for you and your clients I wish you the best. Someone else can always clean up the mess if it doesn’t work out…
JUST KIDDING SO DON’T TAKE IT PERSONALLY!
Sounds good- defn out of the Jones box. Pricing will be int though. Is there any FA pricing discretion? Doubt it, but it sounds good otherwise. The ETFs will help a lot on the taxation issue, if used right. So no, it is not just like a reallocatiing fund. There will be more control than that. Nothing’s perfect–lets give Weddle some credit! (I LOVE life after Jones, but it is a good firm).
What does everyone else have for minimums? It's kind of a rip to the client and unfortunate trade-off to the advisor that everyone that doesn't qualify for higher breakpoints CAN'T use the advisory fee system. If you build a portfolio gradually with C shares, you'll have to wait to use the advisory fees when you have a new 100k all at once. Also the way it sounds it will have to be in a separate account from existing assets.
[quote=CIBforeveryone]
What does everyone else have for minimums? It's kind of a rip to the client and unfortunate trade-off to the advisor that everyone that doesn't qualify for higher breakpoints CAN'T use the advisory fee system. If you build a portfolio gradually with C shares, you'll have to wait to use the advisory fees when you have a new 100k all at once. Also the way it sounds it will have to be in a separate account from existing assets.
[/quote] Oh-and should have said--RJ has only 25k minimum.No, I'm not that sensitive. And you are right - if you do not do much MFD business, Jones would DEFINITELY not be a good place for someone. Not that you CAN'T do stocks, bonds, SMA's, etc., but Jones is so Pro-MFD that life would just be difficult. And I am OK with that, because I actually prefer MFD's. Takes some of the monkey off my back. But as I have said before on this forum, there are a thousand different ways to get to the same answer in investing. You need to have the best platform that fits your own needs and model. Just for curiousity sake, what types of investments are you using if you don't use any funds?Well I guess that makes sense. I think I have a total of maybe 5 clients that even own a mutual fund. Guess that’s why I left Jones, just not my focus. I prefer the programs I have access to compared to what I have read here, but if it works for you and your clients I wish you the best. Someone else can always clean up the mess if it doesn’t work out…
JUST KIDDING SO DON’T TAKE IT PERSONALLY!
Well if you drank the Koolaide I won’t be much help to you, but I specialize in structured products (not the kind that are in trouble) such as revertibles. I do quite a bit in equities, real SMA’s and private placements and etf’s. There are no trails or revenue sharing but my clients have controllable downside risks and specific upside potential (in the structured arena) that makes planning much easier and therefore much happier clientele.
I'm coughing up my Koolaide as I read this....Well if you drank the Koolaide I won’t be much help to you, but I specialize in structured products (not the kind that are in trouble) such as revertibles. I do quite a bit in equities, real SMA’s and private placements and etf’s. There are no trails or revenue sharing but my clients have controllable downside risks and specific upside potential (in the structured arena) that makes planning much easier and therefore much happier clientele.
“Controllable downside risks and specific upside potential” - Kind of sounds like an EIA to me.
Please…I get along with annuities as well as I get along with Jones people. The are both necessary for certain applications but I wouldn’t make a habit of using them…
Actually annuities might be more useful…
I heard that Jones FAs will be able to consider a “switch” from Ashares to the Wrap after 4 years of a holding period for the Ashares.
ETF questions for Broker24(Please do not read any snide attitude into my questions.)…and comments on what happens when you leave:
Why are ETFs good for investors now? Jones taught A class fund investing was an everlasting principle. Why is managed money now a "good idea"? Jones taught that A class fund investing was an everlasting principle. Is jones still teaching you all to open a prospectus and show the operating expenses to a client to "prove" that the A class fund is "cheaper" than managed money? (How embarrassing it is to find out that in many cases the undisclosed costs add up to be more expensive than managed money.) These are all questions that caused many of us to make life alterring decisions to leave. Many of us did not leave because of payout. We left because we were not competitive. Now that many of us have been providing ETFs and Managed Money, jones is just getting there and the rest of us are now providing Energy Partnerships, Equipment Leasing, Real Estate Partnerships, etc. Maybe jones will add these in 5 or 6 years. The difficult part is that when you decide to leave jones for sound business reasons, jones goes into a massive assault on your character. Many "friends" at jones will suddenly stop speaking to you because they are told that anyone leaving jones is unethical. Anyone leaving should be prepared for this.I’m not B24, but I’ll answer your questions. I’m sure he’ll answer you with his own response.
ETFs are like any other investment. Some are good, some aren't. Jones has a focus list of ETFs, all Vanguard and iShares, that they track. There's even a report approved for the public that talks about the basics of ETFs. For those investors who want access to the specific indexes, they are a great option. As FAs it is our responsibility to figure out if ETFs are better or if there is a better fund option for our clients. Old habits are hard to break and Jones is deeply rooted in a mutual fund habit. I don't believe they are saying that ETFs are "suddenly" good for investors. I think as a part of the new fee based program they are giving us many options including no load funds and ETFs in addition to traditional funds. There will be a lot of old dogs at Jones who won't be able to learn the new tricks coming out. They'll stick with the A share is always better routine. If you read the other thread that I've been participating in you might get the impression that I'm one of those guys. I'm not BTW. I am excited that I can give my clients more options than I can now. I think it boils down to the Managing Partner. In the past, Bachman and Hill were unwilling to deviate from the age old A share principle. Weddle can see past the ivory tower his office sits in and recognizes that the industry is moving/has moved toward a solutions based industry vs a product based industry. He's willing to rock the boat and say that fee based isn't bad. In fact, we may get more clients because of it. And our revenue stream will go up. The famous last words of a dying church are "We've never done it that way before". Well, Jones in some ways could be compared to that dying church. Finally, someone has decided that they don't want to keep things the same for the sake of keeping things the same. And I'm happy they're doing it. I'm gonna guess that Jones won't be adding Real Estate LPs or Energy Partnerships anytime soon. They'll bend only so far.I agree with some of what you say ice. But the clients who need things like the evil non traded REITS, 1031’s and Oil & Gas programs are the ones we all want. What is wrong with putting 10% of a clients money in something like that if they are an accredited investor, which they usually have to be? Someone with $1 million plus in invested assets in addition to their IRA might want something other than funds or ETF’s. Those are the clients we all want. If you are spending all your time with people who only need funds you might want to prospect up a bit. Bear in mind I do agree that for the MAJORITY on America, funds are ok, but the competition in our industry is not for those people.
[quote=GoneIndy02]ETF questions for Broker24(Please do not read any snide attitude into my questions.)…and comments on what happens when you leave:
Why are ETFs good for investors now? Jones taught A class fund investing was an everlasting principle. Why is managed money now a "good idea"? Jones taught that A class fund investing was an everlasting principle. Is jones still teaching you all to open a prospectus and show the operating expenses to a client to "prove" that the A class fund is "cheaper" than managed money? (How embarrassing it is to find out that in many cases the undisclosed costs add up to be more expensive than managed money.) These are all questions that caused many of us to make life alterring decisions to leave. Many of us did not leave because of payout. We left because we were not competitive. Now that many of us have been providing ETFs and Managed Money, jones is just getting there and the rest of us are now providing Energy Partnerships, Equipment Leasing, Real Estate Partnerships, etc. Maybe jones will add these in 5 or 6 years. The difficult part is that when you decide to leave jones for sound business reasons, jones goes into a massive assault on your character. Many "friends" at jones will suddenly stop speaking to you because they are told that anyone leaving jones is unethical. Anyone leaving should be prepared for this. [/quote] Listen, I guess Spiff sort of answered it. But I will give my own slant. People have historically bashed Jones for many things, among them, their pro-A share stance. Now that Jones is actually adopting many of the things that bothered people, they are again bashed. The fact is that the "new" leadership at Jones is recognizing that there are issues beyond just what is "cheapest" for the client long term, such as perception (i.e. conflict of interest), choice, firm revenue diversification (all our revenue eggs are in the one proverbial basket), competitiveness with other firms' offerings, and increased income to the firm (GP's) and FA's. I think they also recognize the demographic issues at hand (we all will have more clients redeeming securities than adding over the next 10-15 years). After all, it is a business, and I admire them for recognizing that and adopting important changes. Is every choice, decision, and value that they hold, in my opinion the best? No. But I have yet to be introduced to one firm that is unanimously considered the best in all areas of the business. We cannot be all things to all people, and we certainly aren't. That's why advisors leave. But I think Jones (or at least the current leadership) deserves some credit for acknowledging their weaknesses and choosing to address them. And to be honest, I am not sure I want to be involved in Energy Partnerships, Equipment Leasing, Real Estate Partnerships, etc. Those can be effective when used properly (teaching 11,000 advisors how to use them properly is a challenge at best). But I would prefer that my firm stay out of ecclectic investment areas that can get us in trouble. We have made mistakes in the past, and I don't want to be wrapped up in the next mutual fund scandal, CDO crisis, or market timing scheme.You guys that are complaining that we are bashing Jones need to keep it in perspective.
After Jones bashed us for leaving, tried to ruin our reputations, sued us for non-compete clauses that were questionable at best and tried to make our lives a living hell because we didn’t believe in the A share only philosophy what do you expect?
We are going to laugh at you for finally moving up and attempting to join the 20th century. We are going to have a certain amount of “I told you so” in our attitudes. And I for one am proud of the options I can offer my clients. There is a world of investment products out there that carry less risk and equal or higher returns than your standard mutual fund. And I am not talking about annuities (whoever it was that made that comment the other day). Shoot an Index Linked CD carries no downside risk under 100k, since it is principal protected, and the upside of the market. No you guys will never see a trail, or any revenue sharing (an appalling practice in my opinion) but you might make a happy client and it is something that can go into a true managed account.
As for leasing, private placement, etc… As long as you know what you are doing, they are fine investments for the right clientele. If you can’t offer them then you have no business dealing with more affluent clients. It’s not like you can 1031 into a traded REIT or a mutual fund or do any of the other tax planning techniques needed in that market.
My rant is done. I only post on here about once every couple of months and then I get stuck coming back several times a day for a week to see what’s going on.
I appreciate conversations like this. learned lots about Jones and makes my descion to possibly join Jones a lot easier.
Mostly just tired of the self-righteous. I’ve never been a big funds guy since long term the numbers back up buying and hold multi-nationals if that is your bent. As for the repackaged “crap”, many of them are designed to benefit the client by moderating risk. Some are in fact sales angles, but the mutual fund industry is just as guilty when they bring out a new fund every month (exaggeration). Consider what carpenters must have thought when compound mitre saws came out and they had to get rid of the standard manual mitre saw. One is just plain more effective. New things are not always bad, sometimes they have tremendous benefits.
You could probably take care of clients with 1 fund family, least the majority of them. But someone will offer them something you do not have access to and the odds of them leaving increases. It is alot easier telling someone a specific product is “no good” if in fact you can actually offer it. Jones will be getting these WRAP accounts or whatever they call them and their advisors will be able to still say A shares are better, and now it is not because it is all they offer.
good point, but I can tell you that my last Jones auditor told me that they know they over emphasized Ashares in the past. One of the new compliance talking points is to be sure that other share classes are not automatically discounted. Of course the conflicts of interest…never mind.
I meant “automatically dismissed”
Jones should be applauded for seeing the error of there ways. Bravo.
Still way behind, but moving in the right direction. I agree that most people would be FINE with plain investments. Many could be better with SOME other types of investments. Many of those other types SUCK. Be carful what you put people in. Jones gave me my start in this business and for that I will always be grateful. The Jones brokers in my area are sure high on themselves and need to get over it. JONES' METHOD (HIRING A MILLION BROKERS AND NOT DISCLOSING THE RISKS TO THESE PEOPLE WHO HAVE NO CLUE WHAT THEIR ODDS ARE) BORDERS ON CRIMINAL IN MY OPINION. I SAW WAY TOO MANY PEOPLE BURN THROUGH LARGE AMTS OF SAVINGS AND CREDIT CARDS ONLY TO FAIL OUT AND GO BACK TO THEIR OLD JOB. THIS IS MY BIGGEST BEEF WITH EDJ. I HOPE A BUNCH OF THESE FAILED BROKERS START A CLASS ACTION LAW SUIT SOMEDAY.NewIndy-
Sounds like your experience leaving jones was similar to mine and many others around the nation. It's unbelievable how ugly jones gets when you leave. I was actually called and told that I was a bad parent because I chose to move on by a very high-up St Louis person. I pointed out that he was only making personal insults and we could move the discussion to a point by point business comparison..he hung up on me.[quote=new_indy] You guys that are complaining that we are bashing Jones need to keep it in perspective. After Jones bashed us for leaving, tried to ruin our reputations, sued us for non-compete clauses that were questionable at best and tried to make our lives a living hell because we didn’t believe in the A share only philosophy what do you expect? We are going to laugh at you for finally moving up and attempting to join the 20th century. We are going to have a certain amount of “I told you so” in our attitudes. And I for one am proud of the options I can offer my clients. There is a world of investment products out there that carry less risk and equal or higher returns than your standard mutual fund. And I am not talking about annuities (whoever it was that made that comment the other day). Shoot an Index Linked CD carries no downside risk under 100k, since it is principal protected, and the upside of the market. No you guys will never see a trail, or any revenue sharing (an appalling practice in my opinion) but you might make a happy client and it is something that can go into a true managed account. As for leasing, private placement, etc… As long as you know what you are doing, they are fine investments for the right clientele. If you can’t offer them then you have no business dealing with more affluent clients. It’s not like you can 1031 into a traded REIT or a mutual fund or do any of the other tax planning techniques needed in that market.My rant is done. I only post on here about once every couple of months and then I get stuck coming back several times a day for a week to see what’s going on.
[/quote]
New, I can’t argue with the way you, and others were treated. I have not witnessed it in my region. But that is primarily because we are a young region, and most of the people that have left were either non-producers (new/new’s or 5-7 year “slackers”). We honestly have had no real producers leave.
But, it actually bothers me that Jones does this. If we are so “great” to work for, we shouldn’t have to resort to silly tactics.
Anyway, I guess I’m just not interested in dealing with products any more exotic than stocks, bonds, funds, etf’s, CD’s, annuities, etc. Maybe I’m just a simple guy working for a simple firm (at least half of that statement is true!). But I don’t blame anyone for using them if they work for their clients.
JONES’ METHOD (HIRING A MILLION BROKERS AND NOT DISCLOSING THE RISKS TO THESE PEOPLE WHO HAVE NO CLUE WHAT THEIR ODDS ARE) BORDERS ON CRIMINAL IN MY OPINION. I SAW WAY TOO MANY PEOPLE BURN THROUGH LARGE AMTS OF SAVINGS AND CREDIT CARDS ONLY TO FAIL OUT AND GO BACK TO THEIR OLD JOB. THIS IS MY BIGGEST BEEF WITH EDJ. I HOPE A BUNCH OF THESE FAILED BROKERS START A CLASS ACTION LAW SUIT SOMEDAY.
See, this is unfortunately the case across the entire industry. How many brokers fail out at ML or SB or MS every year? I have a buddy in a very large Merrill office that has seen, literally, hundreds of brokers fail out in his 10 or so years - JUST IN HIS BRANCH. It is not limited just to Jones. That's just a misconception.
[quote=Broker24]
See, this is unfortunately the case across the entire industry. How many brokers fail out at ML or SB or MS every year? I have a buddy in a very large Merrill office that has seen, literally, hundreds of brokers fail out in his 10 or so years - JUST IN HIS BRANCH. It is not limited just to Jones. That’s just a misconception.[/quote]
I agree. I’m no EDJ fan but this certainly isn’t unique to EDJ. This is an industry wide problem.
I obviously can’t speak for others, but I was hardly a washout. I still have my sill Pacesetters print stuck behind my sofa. Someday I will find a nice print to put in the very nice frame… The difference with Jones is that other firms, I would imagine, don’t build up the cult like atmosphere. As such they don’t feel like you’ve broken some sacred trust by leaving them. Jones just gets plain vindictive.
Maybe I’m naive because I haven’t joined EJ yet, but as I read through their prospecting requirements, I think to myself, how can you not succeed??? Do reps fail because of the products or is it because their not prospecting to their full potential???
I was a success at jones. I had to leave because the lack of products crippled me and I was losing the largest, most profitable clients to indy reps. Also, long term, I had no way to sell my book when I retire.
I would not recommend anyone go to jones. Jones is VERY cultic. I cannot emphasize this enough. It's difficult to explain this jonesism. You just have to trust us on this. Cults have common traits, i.e., everyone else is wrong and only we do it right. Isolation-when jones found out that Lord Abbott invited our region to a mixer with other reps from other B/Ds, we all got FRANTIC phone calls from St Louis telling us that we were not allowed to fraternize with other firms and if we attend we would be "dealt with". What were they afraid of? Would we compare business models and find that jones might not be the right fit? At the time I too was convinced that jones was holier and purer than everyone else. Didn't take long though to see that this trait of "isolation" is one of the many signs you are in an insecure company.[quote=lambda]Maybe I’m naive because I haven’t joined EJ yet, but as I read through their prospecting requirements, I think to myself, how can you not succeed??? Do reps fail because of the products or is it because their not prospecting to their full potential???[/quote]
If that is your main question, you’re not “maybe” naive - you’re are naive.
How can you not succeed? The prospecting requirements are much harder than they sound. What they cannot and do not accurately convey is the effect of repeated rejection has on your morale. This causes you to reinvent the wheel (find a new better way to prospect) or find prospect avoidance techniques that still make it seem as if you are working. This is how most new brokers fail. Lack of product rarely has anything to do with new brokers failing because the majority of new brokers are selling A shares and annuities which is available anywhere.
You see trhe prospecting requirements for ONE DAY and think: “no problem”. But it is day after day after day-- dogs barking and licking, sweating hands trying to write legibly, it rains and snows, 15 houses in a row seem to HATE to see you…most people cannot handle it, so for me it was a point of pride the worse it got…so I succeeded.
[quote=lambda]Maybe I’m naive because I haven’t joined EJ yet, but as I read through their prospecting requirements, I think to myself, how can you not succeed??? Do reps fail because of the products or is it because their not prospecting to their full potential???[/quote]
If that is your main question, you’re not “maybe” naive - you’re are naive.
Okay Lambda…Now that you know the prospecting method, sign on with an independent firm or an interdependent firm. Get 70-90%. Why go to jones? Many regional firms will train you and pay you 50-70%. Once you are up and running they will bump you to 70-90%.
Think hard on this. It's a tough business. It's alot tougher when you gross 25k and your net pay is a paltry $6200. After taxes, after YOU PAY for newsletters, half of your seminar costs, etc., not much left for you. I still have a paystub I keep. While at jones I grossed nearly 70,000 in one month. Top of paystub was 25K, net to me, just a hair over 15k. Ugh! My naivity QUICKLY wore off. Lambda-Look elsewhere before you sign.Oops! I forgot one thing.
You should go to jones. Why? Partnership. Partnership is so grand!! And such a good deal. (Tongue firmly planted in cheek.)[quote=Bluetang]
How can you not succeed? The prospecting requirements are much harder than they sound. What they cannot and do not accurately convey is the effect of repeated rejection has on your morale. This causes you to reinvent the wheel (find a new better way to prospect) or find prospect avoidance techniques that still make it seem as if you are working. This is how most new brokers fail. Lack of product rarely has anything to do with new brokers failing because the majority of new brokers are selling A shares and annuities which is available anywhere.
[/quote] Bingo!Just so you know, Jones has an SMA platform it is called the MAP Account. The product that they are rolling out in the next (who the hell knows when…) is a mutual fund wrap act with the option of going with ETFs. I have about 10% of book in MAP.
I left in early February after field supervision wouldn’t allow my client out of his American funds and into commodity ETFs like GLD. DBA, OIL or FXY.
They’re not that fond of SDS, QID, etc. either even though a four year old could see we were in a bear market.
Their one size fits all, cookie cutter, well diversified portfolios work ok in a bull market but are a recipe for disaster with the bear.
Still, one broker summed it up nicely over lunch at the Tempe campus, " I’m not interested in the market, I’m interested in trails. "
If they’re not a cult what is a cult?
Wouldn’t let you out of American Funds? A share? How long were they in? And American Funds made it through the last bear just fine and will do the same for this bear. Just make sure you are in the correct funds. Back to the original topic, if the client were in a managed account, moving them would not be a problem.
If the client were in a managed account and Edward Jones was running it they would be dead meat in a protracted bear market i.e. 1972 thru 1982.
BTW, in all those classes on sneaky ways of gathering assets and "deepening client relationships " it seems odd Jones never found a moments time to discuss market fundamentals.
Ever wonder why?
They don’t want you to know, could stop the preferred funds kickback machine which makes up , oh, 40% of their revenue?
I was at a due dilligence meeting a few weeks ago and was having dinner with a group of guys, when a young FA who had been out of the PASS program for a year or so informed us that the fastest way to get to Seg. 4 was the same way he got to Seg. 3...splitting the ticket between three mutual fund companies. He then went into explaining exactly how much this strategy increased his payout. He said he justifies this with compliance by explaining to them that he believes in the firm's philosophy of not putting all of his clients' eggs in one basket. I looked at him incredulously and replied that following his logic, he should be recommending that his clients invest only a portion of their money with Edward Jones and he should then refer them to two other firms to invest the remainder of the money. He just looked at me with a blank stare. Creep.Still, one broker summed it up nicely over lunch at the Tempe campus, " I’m not interested in the market, I’m interested in trails. "
If they’re not a cult what is a cult?
[quote=Bluetang]
Lots of Putnam locally, and of course American Funds. Don’t wanna get too specific because one of these days I will be wrong and when I am want as little egg on my face as possible.
Splitting the ticket three ways is normal at Jones?
I've seen two families used on a regular basis, but never three, up until this incident.I was a very recent seg 2 grad but LPL took me on because of my numbers.
At the 3 day seg 2 grad session in Tempe I mentioned I might be leaving to someone (?) over lunch.
At the closing ceremony a seg 4 stood up to address the 150 or so people and got so emotional (over what I’ve yet to understand ) that he started babbling and crying.
-Thought I was going to throw up.
I was completely upfront with the area general partner telling him the truth.
" I’m not jones material. "
He still probably doesn’t know what a CDO is.
When the jones tag team phoned for the " mandatory you quit or we fire you " conference call they were aware of that conversation over lunch in Tempe. Once again - stepford brokers.
[quote=Borker Boy]
Splitting the ticket three ways is normal at Jones?
I've seen two families used on a regular basis, but never three, up until this incident. [/quote] Why use two families and miss one breakpoint when you can use three and miss two or more breakpoints.[quote=Borker Boy]
He said he justifies this with compliance by explaining to them that he believes in the firm's philosophy of not putting all of his clients' eggs in one basket. I looked at him incredulously and replied that following his logic, he should be recommending that his clients invest only a portion of their money with Edward Jones and he should then refer them to two other firms to invest the remainder of the money. He just looked at me with a blank stare. Creep.[/quote]Borker, you are rapidly reaching the point at where your ethics and the culture you are witnessing become mutually exclusive. I applaud your honesty and courage to say what you think, but if this is the kind of garbage that is sanctioned and encouraged in your region, I doubt you’ll last long with your current firm.
[quote=GoneIndy02]I would not recommend anyone go to jones. Jones is VERY cultic. I cannot emphasize this enough. It’s difficult to explain this jonesism. You just have to trust us on this. Cults have common traits, i.e., everyone else is wrong and only we do it right.
Isolation-when jones found out that Lord Abbott invited our region to a mixer with other reps from other B/Ds, we all got FRANTIC phone calls from St Louis telling us that we were not allowed to fraternize with other firms and if we attend we would be "dealt with". What were they afraid of? Would we compare business models and find that jones might not be the right fit? At the time I too was convinced that jones was holier and purer than everyone else. Didn't take long though to see that this trait of "isolation" is one of the many signs you are in an insecure company.[/quote] I was told something very similar on my due diligence at American Funds last summer...no Jones reps there either. My wholesaler told me that AmFunds hosts Jones-only events since Jones management does not want their reps fraternizing with us evil independent and wirehouse brokers . Interestingly enough, there were plenty of wirehouse and regional firms represented there...the only notable exception I recall was EDJ. If you think it's for your protection, think again. My guess is, management is no fan of these forums either...[quote=Borker Boy]
Splitting the ticket three ways is normal at Jones?
I've seen two families used on a regular basis, but never three, up until this incident. [/quote] I should clarify, bigger accounts are split more than smaller accounts. Point is they are split. When you put a large cap value fund from multiple fund families in the same portfolio, kinda makes the entire diversification argument dry up. Two possiblilities exist. 1. Splitting tickets for payout 2. Lack of understanding of asset allocation and what diversification actually is. Again, this is from personal experience in my area with a number of EDJ brokers. I believe that every firm has good and bad advisors. I will leave it to others as to determine if this is the result of incompetance or unethical behaviour.That’s funny. I remember how hard of a time they gave me when I would use x-ray to show people what they actually owned and exactly how non-diversified they really were. Multiple funds don’t always mean you are diversified, but they never bother to tell the young Jones guys that.
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