What is the best way to position

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Nov 1, 2005 3:24 pm

...fixed income sales?


I am an old insurance guy that has landed in a bank brokerage operation.  Needless to say there are a lot of retired folks with money in CDs, money markets, and savings accounts.  They generally dislike annuities although I can get enough folks to listen.  I feel that fixed income would be a good alternative for the right clients but I have never really sold any bonds.


What is the best way to position this sale?


What are the hot buttons?


What are the features and benefits.

Nov 1, 2005 4:41 pm

When I was at a bank I had a good deal of success with structured notes,

laddered bonds and bond portfolios that issued a coupon check every

month.



Later, I would present a portfolio of zero coupon T Bonds with an equity

mutual fund, which I call "bullet proof".



Good Luck!

Nov 1, 2005 4:58 pm

Thanks for the input skee.


Were these HNW folks?


I am usually seeing $50,000-$200,000 sitting on the sidelines.  I had always assumed that a laddered bond portfolio needed more than this amount to be beneficial.


Nov 1, 2005 7:53 pm

No way. You can buy 5 tranches of $40K total $200K.



Bank clients like money coming due every year...I guess it gives them a rise

in the pants.



Always start with the annuity and work down in production.



Nov 1, 2005 8:30 pm

"I am an old insurance guy that has landed in a bank brokerage operation.  Needless to say there are a lot of retired folks with money in CDs, money markets, and savings accounts.  They generally dislike annuities although I can get enough folks to listen.  I feel that fixed income would be a good alternative"


"Always start with the annuity and work down in production. "



PERFECT.......And they say the stereotype of the bank FA is outdated? Yup, just try to slam then into that annuity first, then if they object consider something else......

Nov 2, 2005 1:08 am

Try a bond fund?  See if Franklin has a muni fund for your state and talk about taxes.  Thornburg income fund is decent too.  I'm just talking about the marketing material.  Show them that the NAV fluctuates some but not much, and the returns are better than CDs.

Nov 2, 2005 7:19 am

Blarmston:



I felt the same as you about stereotype bank brokers. But when I did

$20,000 month and they were doing $70,000 a month, I changed my

opinion.



Take care.

Nov 2, 2005 11:35 am

Skee,


Yeah, I could quadruple my monthly production if I slammed everyone into the highest producing product out there. I have friends back east at B of A, HSBC, Chase, and a buddy at Bank One in Phoenix that ALL tell me that the annuity is the FIRST product they think about when a new victim comes walking into their branch.

Nov 2, 2005 11:38 am

[quote=Dewey Cheatham]


What is the best way to position this sale?


Income generation for retirees/ non correllating asset for non retirees


What are the hot buttons?


yield talks, everything else walks


What are the features and benefits.


Monthly/quarterly/semi annual income- to meet income/portfolio needs


Moody/S&P ratings- allows customization of risk with use of an unbiased third party credit rating agency. Belt and suspenders to bet the pass line flexibility on a case by case basis.


laddering/ maturity selection- enables a portfolio to be custom tailored to each client's unique future income needs


Tax Free- maximizes client's in pocket income.

Nov 2, 2005 2:10 pm

For a small percentage of fixed income I have been using closed end floating rate funds. You must be careful though I only use ones that are trading at a deep discount 10% or more! And watch the the leverage on the issue also! 


I never purchase these these at the IPO. If you work for a  wire house they will  try to push them right at the start but remember they could care less about you or the client it is all about moving money for them!     


I also have used open end floaters for the past couple of years.

Nov 2, 2005 4:55 pm

Blarmston:



Do your family the favor and slam a few a month and double your

production. Of course we don't have the benefit of knowing who each other

is or our resumes, so I'll remain civil on this thread.



The bank model favors the high production ticket if you have a steady

stream of fresh money. I, on the other hand, do not and must balance my

opportunities in order to optimize my income.



It sounds to me like there's a little envy in your position.

Nov 3, 2005 5:27 pm

Blarmston:


I see similar actions in my bank program.  When I came aboard here almost two years ago my manager told me 80% of the business was in fixed annuities.


That number must be less today.


I am the "anti-bank broker" perhaps as in my tenure here I have sold a grand total of two fixed annuities and zero VA's.   The two FA's were unsolicited btw as I tried to talk them out of it.


Most of my practice is mutual fund wrap accounts using a variety of asset allocation models.    As my practice matures I plan to introduce some other products and Long Term care insurance sounds like a good fit for many of my clientele.


scrim

Nov 3, 2005 8:50 pm
skeedaddy:

Blarmston:



Do your family the favor and slam a few a month and double your

production. Of course we don't have the benefit of knowing who each other

is or our resumes, so I'll remain civil on this thread.



The bank model favors the high production ticket if you have a steady

stream of fresh money. I, on the other hand, do not and must balance my

opportunities in order to optimize my income.



It sounds to me like there's a little envy in your position.





Skeedumba$$,



I assure you there is no envy in my post.  You think $70K per
month is something to boast?  For many out here $70K is a small
portion of production that is generated every month for showing
up.  I was in a bank watching morons like you who have conviced
themselves along with most of management that they are smart. 
Your not, your just greedy.  You and yours are the reason so many
honest advisors have to jump through hoops to do the right thing. 




Take your posts and send them off to the NASD, and see what they
say....do it.  I hate poeple like you for your view, but
appreciate you because you are like the flu- we would not know how good
being healthy is if we did not have to experience bad sickess
occasionally.




Nov 3, 2005 9:51 pm

Skee-


I believe Rightway just made you look silly....

Nov 3, 2005 11:50 pm

I'm lost...is Rightway your alter ego? How can I address Blarmston and get a

response from Rightway (in the 1st person)? You must be doing very well, I

mean you and "Blarmston" have the time to post over 700 times on this

forum.



Anyway be that as it may, $800K-$1 million in production puts me or

anyone in the top 2% of this field. It sounds like you'd rather limit your

income to a fraction of 1% per year, that's fine.



By the way, after 12 years in the biz, I have never been the subject of any

customer complaints.   

Nov 4, 2005 12:24 am
Greenbacks:

For a small percentage of fixed income I have been using closed end floating rate funds. You must be careful though I only use ones that are trading at a deep discount 10% or more! And watch the the leverage on the issue also! 


I never purchase these these at the IPO. If you work for a  wire house they will  try to push them right at the start but remember they could care less about you or the client it is all about moving money for them!     


I also have used open end floaters for the past couple of years.




PHD?

Nov 4, 2005 9:10 am
skeedaddy:


Anyway be that as it may, $800K-$1 million in production puts me or

anyone in the top 2% of this field. It sounds like you'd rather limit your

income to a fraction of 1% per year, that's fine.



By the way, after 12 years in the biz, I have never been the subject of any

customer complaints.   





Some people are doing $1m plus without "starting with an annuity and
moving down" to "take care of me and my family" or to "get paid". 
You are in a bank, you will get complaints soon, just wait. 



I post alot alot because I like to.  This is a nice locaion to get
some different views, idea's, and information, thas all.  When you
post, you are not posting to one person, if you want to do that, send a
private mesege.  Its a FORUM. 



Lastly- I find it hard to believe that only 2% of reps are doing over
$800K.  I have nothing to back that up, but if that is the case,
it is a little sad.  Enough, enough, go feed your family, I am
going for a hike.

Nov 4, 2005 10:13 am

I was curious so I did some research and in my program it appears that about 2% are doing over 800k.


Average rep is doing approx 300k.


(I'm at 200k doing mostly managed money without any trails yet so I'm pretty satisfied where I stand)


top quintile is doing 400k this year.


My thoughts are that productions numbers are down a bit since fixed annuities have been a tougher sell in '05.


TGIF


scrim

Nov 4, 2005 11:42 am

Start slamming everone who walks into your branch with some variable annuities then......

Nov 4, 2005 12:43 pm
skeedaddy:

Blarmston:

Do your family the favor and slam a few a month and double your
production. 


Or, you could take the long term view and do your family a favor by way of doing your clients a favor and doing the right thing by them. 


Then, when your client's happy, your book grows (happy clients bring referrals), your income grows, your family's happy, and  they they don't have to consider how you'll make ends meet after the regulators end your career and force you to work at a Kwicky Mart because you thought you'd get ahead by "slam[ming] and few a month".