Edward Jones Performance Exception
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Hi Ice,
I got 19 million under management. Most is transactional because I followed the Jones A share model most of my career. I do love my clients - like most of us. My book is pretty picked over. Out of my accounts maybe only 3% are inactive. We’ve looked for the obvious places to boost the numbers. I was up to 24 million last year before the wheels came off the economy.
I have a good friend who is with LPL and before I jump into the wholesaling GIG I will talk to him first.
I’ve already made the determination that if I do leave Jones I do so in a manner that is the least painful for my clients. I’m not going to blindside them.
It’s interesting because up till about 6 months ago I was honestly convinced that the Jones model was the best one to follow. Now, thanks to this market I am questioning “Buy and Hold”. Does a client really have to stay fully invested and take the full body blow of a serious bear market?? I know we can’t time it but…
They always say you don’t want to miss 10 of the markets best days or you cut your return in half??
What happens if you miss a few of the markets worst days?? It works in reverse as well.
My buddy at LPL has been talking to me about some of his options strategies which, though no cure all, have been taking the edge off this bear for some clients.
My won deal is that I’m in a new marriage. I have a strong urge to be the “provider”. You know the deal.
Thanks for your thoughtful reply.
Sword
Tough situation, Sword. Lot of us are sailing into that same sea. I would talk to your friend and listen to what Ice says, because it ain't going to calm down for a while.
ICE is right… I don’t understand why some people just don’t get this… Jones people are forgivable because they never get to interact with other brokers…
You have $20MM in AUM...Move to LPL take a 70-80% payout(let's assume low 70%). Xfer your book in-kind(lets assume you get 60% of your book(again go low) so $12MM.. So just in trails you have $30K(12M@25bps) so $21K minus fees(assume $3k) so $18K. Now lets change just a few things... So you have been with jones 5 years( so you have some Putnam, Van Kampen, Goldman Crap, etc.) talk to those clients about transitioning to fee based(use no load funds or etfs to decrease their cost or find a 3rd party manager to do it) convert your book to fee based, lets assume year 1 you can convert 50%.. Now you have $60K in feebased(assume $6MM at 1% for low end).. plus another 6MM@25bps so....$75K total so that is $52.5K minus expenses= $47.5K.. and that is with no additional assets, no xfer of annuities, no money dues, no bonds due, no referrals, no prospecting... Make the move..Sounds like good advice.
It’s time to have the serious conversation with my friend and put numbers on paper. About half of my assets are in funds. Maybe 55%. I do more stock, UIT, and bond business than most brokers in my category. I have a growing annuity slice as well.
I’m curious about one thing. I don’t know if anyone knows ?
Normally in UPTICK magazine they print the number of brokers meeting and not meeting expectations. Last issue they mysteriously didn’t print that information. Does anyone have any idea how many other brokers are in the same boat??
I heard Segments 2 and 3 are getting rocked. Looking at my own region I could count about 4 guys in my time range that had similar numbers. I even saw a few 7 and 8 year guys whose numbers looked pretty weak.
Annuitization was part of my long term plan. I would have moved with more urgency of course if I had foreseen the events of the past 12 months.
Sword,
I was also in the Jones class of 2004, can-sell-date of March '04. AUM $18 mill, trailing 12 approx. $180K. Started looking at LPL about 3 months ago, made a home office visit in the first couple weeks of December, jumped from the giant green ship 2 weeks ago. It has been the busiest 2 weeks of my life, in the office at 7 am and not home until after 9 pm. I have averaged about 7-8 appointments per day and so far only 1 client has flat out told me "no, I'm here because of Edward Jones". I already have signed ACAT paperwork for 20 of my top 35 clients, and I just haven't been able to meet with the other 15 yet, but it's only a matter of time. I took no info with me from Jones and all I did was send a "Tombstone" letter from LPL to my clients and they have been calling me to schedule appointments. It is going better than I thought it would be going at this point. I am talking about my potential strategy to manage money with the fee-based accounts at LPL, which by the way, start with a minimum investment of $25K, and all of my clients are interested, if it could help them down the road. I am also my own OSJ and I started my own independent office.
You can send me a PM and I would be glad to talk with you to share the strategy I have been using to help my clients see how transferring their assets, after they have inquired, from EJ to LPL will benefit both them and me. It's a win-win for both of us. I think it would be a mistake to walk away from the relationships you have built with your clients, unless you can't handle the pressure of the business any more. That's my 2 cents. Let me know if you need any help. LapideHe mentioned he had a friend who worked at LPL, I was assuming if his friend took 20% of his production(assuming he shares an office with the guy) then $5K should cover the rest…
I left Jones almost a year ago and was talking to someone in my old region. He said that 90% of the brokers in the old region are red. Goals is still 40% of expectations, if you stick a new broker in an office he won't go red for at least a year or so. Throw a new broker in an office and eventually that office will be profitable even if you have to chew through 10-12 brokers to do it.... Not a company I want to be associated with.Sounds like good advice.
It’s time to have the serious conversation with my friend and put numbers on paper. About half of my assets are in funds. Maybe 55%. I do more stock, UIT, and bond business than most brokers in my category. I have a growing annuity slice as well.
I’m curious about one thing. I don’t know if anyone knows ?
Normally in UPTICK magazine they print the number of brokers meeting and not meeting expectations. Last issue they mysteriously didn’t print that information. Does anyone have any idea how many other brokers are in the same boat??
I heard Segments 2 and 3 are getting rocked. Looking at my own region I could count about 4 guys in my time range that had similar numbers. I even saw a few 7 and 8 year guys whose numbers looked pretty weak.
Annuitization was part of my long term plan. I would have moved with more urgency of course if I had foreseen the events of the past 12 months.
[quote=Lapide]
Sword,
I was also in the Jones class of 2004, can-sell-date of March '04. AUM $18 mill, trailing 12 approx. $180K. Started looking at LPL about 3 months ago, made a home office visit in the first couple weeks of December, jumped from the giant green ship 2 weeks ago. It has been the busiest 2 weeks of my life, in the office at 7 am and not home until after 9 pm. I have averaged about 7-8 appointments per day and so far only 1 client has flat out told me "no, I'm here because of Edward Jones". I already have signed ACAT paperwork for 20 of my top 35 clients, and I just haven't been able to meet with the other 15 yet, but it's only a matter of time. I took no info with me from Jones and all I did was send a "Tombstone" letter from LPL to my clients and they have been calling me to schedule appointments. It is going better than I thought it would be going at this point. I am talking about my potential strategy to manage money with the fee-based accounts at LPL, which by the way, start with a minimum investment of $25K, and all of my clients are interested, if it could help them down the road. I am also my own OSJ and I started my own independent office.
You can send me a PM and I would be glad to talk with you to share the strategy I have been using to help my clients see how transferring their assets, after they have inquired, from EJ to LPL will benefit both them and me. It's a win-win for both of us. I think it would be a mistake to walk away from the relationships you have built with your clients, unless you can't handle the pressure of the business any more. That's my 2 cents. Let me know if you need any help. Lapide[/quote]Hire some couriers to get the last 15 acats signed. Have the courier stand at the door while the clients signs, so he can bring it right back to you.
I just looked how our month ended in our region. Many are below the red line. The growth teams already are expecting 18-25% to leave the culture. But we all know they have all those recruits to back fill the offices. The also have the “new” transfer broker recruiting program. Jones has all the bases covered. It is their plan, new trumps someone with experience.
Oh, well it is still the best way to get the 7, get experience, and move on!!!Hank,
Hiring a courier would be a great idea, but I've never heard of anyone (person or entity). in my neck of the woods who performs that kind of service. I have about 4 hours tomorrow when I don't have appointments in which I can make outbound calls. I am confident I will set up most of the appointments tomorrow. Thanks for the advice. Lapide[quote=Lapide]Hank,
Hiring a courier would be a great idea, but I've never heard of anyone (person or entity). in my neck of the woods who performs that kind of service.Lapide[/quote]
I can't believe you said that.
A qualified contact is defined as someone with whom you’ve had the opportunity to speak about financial matters or someone with whom you’ve presented an investment idea. The prospect should demonstrate, at the least, an interest in hearing from you again in the future.
I always loved the definition of a contact. So many people would have the door slammed in their face, write down the address and name from the mailbox, do a reverse lookup and consider it a contact. Then they wonder when they go back to eval grad and have an f-bomb dropped on them phoning these people. One guy had 600 prospects in the system and 300 phone numbers. One as a joke was Santa Claus. He never made it back to PDP.
So, Edward Jones is still hiring like crazy (just look on monster.com). They are willing to grow by hiring new people but are letting go the more established segment 2 and 3 who are struggling.
I am still trying to find the logic. I could understand if they were not hiring new people. So you get rid of someone covering most of the office and BOA cost and replace that person with a newbie (not saying anything bad , just looking at the logic). I realize sooner or later, you need to get rid of the non-performers but Saint louis is having tunnel vision and not looking at the whole picture.I agree with you, they are rather crazy about hiring. I heard from two newbies that they where told where to door knock or do a legacy with the seg 2 or seg 3 that was on the “not going to make it list” This is the MOST unprofessional practice I have ever heard of, but since HR is non-exhistant at jones they get away with all kinds of things. It is awful, how the big guys sit around and discuss who they are are replacing with the newbies in front of everyone. I look back and remember them talking about the “offices” that could be opening for me when I was new. Looking back it was just another empty promise.
The region acts like "giving" you an office is such a wonderful thing......they should be thankful we take over offices where 4 others have failed!!! I really wish they would spend some of the resources to figure out how to help the exhisting fa. BUT they never will change..this is the way old Ted would have wanted it done........get the loser out of there..replace them with a new fa that knows all the HOT American Funds, and one stock BAC!!! (how many shares can you buy now with 5k?) gotta love jones