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Mar 22, 2006 8:43 pm

[quote=discountbroker]

[quote=mikebutler222]

[quote=discountbroker]   I just
don’t fully believe that most full service brokers have their client’s
interest ahead of theirs. 
[/quote]

That's pretty rich coming from a guy on the "make investment decisions on your coffee break" side of the biz where the money is made by encouraging the ill-informed to be the worst sort of investor, the one's most likely to lose their shirts, the "active trader"....

[/quote]
Clients are expected to understand what they are doing where I work, we give them the tools to make their own decisons (This is not a Waterhouse Ad).  I don't really care what they buy or sell, so long as they keep hitting that trade button and adding to that margin debit everyday (I am joking)......

but really.....
there are some shady guys on your side........
there is shady people on my side of the biz as well.....



[/quote]

Yes but are you REALLY joking?

Discount brokers hand out perks to ACTIVE traders just like the casinos give out comps in Las Vegas......hmmmmmmmm
Mar 22, 2006 10:49 pm

yeah, you know its pathetic when they give out IPOD’s for openeing an account… That really goes over with the affluent…

Mar 23, 2006 1:20 am

The only quotas I have ever had were at a bank.  Any rep making a
decent living at ML is not under the pressure of any quotas, other than
the ones ones they set for themselves.  The new reps do have big
quotas to meet to get them going quickly…and those that make are
thankful for them when they graduate.  I run the POA program
(rookie brokers) at our ML office, and every last one of them have
individually managed equity accounts.  Our process does not take
up much time, all of our POA’s get trained on 1 of the strategies right
off the bat. 



I am on a team and we are able to segment responsibilities, which is
why we can run 5 strategies.  I see no reason why a new sole
practitioner cannot run 1 strategy as our POA’s do.  With that
said, the first strategy they do only changes positions monthly, so it
is not real active.



To be really good at growing fast we have to find some way to be
different.  It can only be done a few ways, and this is one of
them.   There are others, but I say find a model that is easy
to implement and manage, find a platform to  run it on, and go for
it!



We have 1 strategy that was up 34% over the last 12 months
(feb-feb).  This unusual performance has given us several
substantial additions and referrals; plus we charge 1.5% and started
with about 20 million in it.  That is 6.8m increase at
1.5%…$102,000 in additional revenue.  Trust me, I spent less
time on this that going out prospecting for an additional 6.8m in
assets.   

Mar 23, 2006 1:40 am

[quote=babbling looney]

Then you need to be an independent advisor, where you decide
how much income or how litttle income you want to make. If you
work for someone else (Jones, SB, ML or other wirehouse) you are
under a production quota and must reach your goals or you are out the
door.  Actually independent BDs also have production quotas or
else they will either drop you or you have to pay an accomodation fee
(for being a pain in the butt to them without making them money  .
Usually the requirments are are much less than that required
at a wirehouse.  I usually meet mine in the first month or
two of the year.

That is why I became an independent advisor.  If I want to waste time typing to you on this board and not make a required number of cold calls... It is my business. My production goals are my own.....well mine and the utility and mortgage company's.  Obviously, we all need to make a living.

Also I understand (I think) that the minimum production can be shared by several brokers.  For example: if the office goal is to have 500k of production to be a stand alone office then maybe  it will take 2 or 3 people to make the minimum.

[/quote]

We can charge between 50 bp and 3% and run discretionary or non-discretionary portfolios.  Our discretionary portfolios can be run just like a fund (I decide to sell ABC and buy XYZ I process 1 trade and all 50 accounts in the strategy are done).  Everything is on a fee basis so there is no incentive to over-trade.  The quotas are only for rookies, and they are based on fee based assets, not production.  The end quota is basically 15 mil within 2 years....which should be doable for good rep. 

I will admit though, I am intrigued with owning my own firm.
Mar 23, 2006 10:23 pm

[quote=rightway] We have 1 strategy that was up 34% over the last 12 months

(feb-feb). This unusual performance has given us several

substantial additions and referrals; plus we charge 1.5% and started

with about 20 million in it. That is 6.8m increase at

1.5%…$102,000 in additional revenue. Trust me, I spent less

time on this that going out prospecting for an additional 6.8m in

assets.

[/quote]



Congrats on the #'s



That $102,000 additional revenue is ML revenue not yours. As we see from your payout grid (if accurate) your getting 50% of that max.



Being indy, you’ll get an additional $15,000 to $20,000 more than your half of the $102,000. Or on the whole $26.8 mil you’d get around $75,000 more per year. (Assume all 5 strategies have the same amount that equals $400,000 per year.)



What does ML do for you to deserve that kind of coin annually?

Mar 24, 2006 1:30 am

[quote=Moneytree] [quote=rightway] We have 1 strategy that was up 34% over the last 12 months

(feb-feb).  This unusual performance has given us several

substantial additions and referrals; plus we charge 1.5% and started

with about 20 million in it.  That is 6.8m increase at

1.5%…$102,000 in additional revenue.  Trust me, I spent less

time on this that going out prospecting for an additional 6.8m in

assets.   

[/quote]



Congrats on the #'s



That $102,000 additional revenue is ML revenue not yours. As we see
from your payout grid (if accurate) your getting 50% of that max.



Being indy, you’ll get an additional $15,000 to $20,000 more than
your half of the $102,000. Or on the whole $26.8 mil you’d get around
$75,000 more per year. (Assume all 5 strategies have the same amount
that equals $400,000 per year.)



What does ML do for you to deserve that kind of coin annually?[/quote]



I think of that often.  ML provides the institutional platform,
the perormance reporting, and about 75% of my research that got us
those returns.  Like it or not, the Brand has gotten us into RFP’s
that are very large, and we only seem to compete with SB, Goldman,
Northern Trust, etc…  I have never once seen an smaller
independent money manager in there. 



Besides that, I happen to just plain ike working at Merrill
Lynch.  Its a good firm, with good people, that have been very
good to me. 



I have worked hard to build a nice team, we have a niche, we all make
plenty of money, we make all of our own hours and vacations, and
mangement is very good to us, so going indy at this point is not even
an entertaining option…it just does not fit our business model. 
Thanks for the non-sarcastic query and compliement- it is apprecieated.

Mar 24, 2006 2:10 am

It sounds like Rightway is on the right track. That is, offering something

that the client can’t get by simply walking across the street. That’s my

approach now that I’m building my 3rd book. No thanks to Mr. Wall

Street.



BankFC, on the other hand, still can’t decide whether to get his CFP or his

CFA. He’s trying very hard to get the respect he thinks he deserves. I

have friends at several bank brokerages; Wachovia, Citibank and HSBC.

They produce more than double what I produce, but they still have an

inferiority complex. Or better said, a feeling of inadequacy. I think its a

pretty decent gig if you can’t make it on your own, right?









Mar 24, 2006 3:57 pm

I love it...

DAYS LATER skeet is still fuming over internet posts.  Skeet, I had forgotten all about you little guy.  Thanks for reminding me.

Good luck on that 3rd BOOK of yours...  

Mar 25, 2006 2:06 pm

No inferiority complex here I take money all day from Merril, LPL, AMEX, etc I don't discriminate.  The longer I sit where I sit the more people sign up to see me.  My phone rings.  I don't remember what a cold call is, I can't even respond to all the people who want to talk to me.

I would say if someone has an inferiority complex it is more of a personality issue than where they work.  I am confident if I decided I wanted to work at Merril for example they would hire me and my clients would follow me, however, I am quite happy where I am.  If it ain't broke don't fix it.