Jones managed accounts

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Mar 4, 2008 5:26 pm

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....

Mar 4, 2008 5:27 pm

Projected launch is this year around Summer Regionals. 

Mar 4, 2008 5:38 pm

Is everyone in agreement it will be fund only? 

Mar 4, 2008 7:34 pm

Wouldn't that defeat the purpose of SMA's...

Mar 4, 2008 9:27 pm

 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 yesterday
Mar 4, 2008 9:37 pm

Really...where'd you go?  Regional?  Wirehouse?  Indy? Out of business?

Mar 4, 2008 10:11 pm

Congratz, newnew!

Mar 4, 2008 10:50 pm

indy-sharing an office (Schwab Instit)

Mar 4, 2008 11:04 pm

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.

Mar 5, 2008 10:21 am

Nobody said they were doing SMA's correct?  I assume it will be more of a fund wrap account than anything else.

Mar 5, 2008 10:43 am

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. 
Mar 5, 2008 11:13 am

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 J
Mar 5, 2008 12:08 pm
exhausted:

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.

 
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.
Mar 5, 2008 1:10 pm

Well that pretty much destroys the major benefits of SMA's then doesn't it....

Mar 5, 2008 3:00 pm
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.


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?

Mar 5, 2008 4:08 pm
Morphius:
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.


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?

 
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.
Mar 5, 2008 4:09 pm
new_indy:

Well that pretty much destroys the major benefits of SMA's then doesn't it....

 
SMA's are different.  We have a separate SMA platform for individual stocks/bonds.
Mar 5, 2008 7:20 pm

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.
Mar 6, 2008 10:08 am
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.
Mar 6, 2008 10:54 am

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.