Download the 2011 OC’s TOP WEALTH MANAGERS list (pdf)
The county’s top wealth managers held on to most of their clients through the downturn and are picking up new business as the economy recovers.
Laila Pence, of Newport Beach’s Pence Wealth Management, said business has grown 40% in the past year.
Trudy Haussmann, founder of Haussmann Financial Inc. in Newport Beach, saw her customer base grow to an all-time high of more than 2,800 in 2010.
Sid Miramontes credits his team at UBS Financial Services Co. in Brea for bringing in a record amount of business last year.
The six entries on this week’s Business Journal list manage about $4 billion in assets for retirees, business owners, rank-and-file employees and others.
The list is made up of local managers cited earlier this year by Barron’s magazine as top advisers in California. Barron’s ranks top performers in each state, using a proprietary formula that looks at assets under management, years of experience, investment strategies, customer service, sophistication of service offerings and other factors.
Rankings cited in this report refer to the California list by Barron’s.
A year-over-year comparison of the local group of top managers is not available because five wealth of the 11 wealth advisers on last year’s list did not make the latest Barron’s rankings.
The ones that did make it onto Barron’s list held their ground and even managed to grow with a number of strategies.
No. 35 Bob Klein, a wealth adviser at J.P. Morgan Securities Inc. in Newport Beach, moved his clients into long positions as interest rates bottomed, capturing big gains as the stock market rebounded in the past 18 months.
“That really set me apart and helped my clients,” said Klein, who manages about $500 million in assets for mostly business owners and entrepreneurs.
His average account size is $1.5 million and a typical client has a net worth of $5 million, according to Barron’s, which is part of Dow Jones & Co.
Bank of America Merrill Lynch private wealth adviser Tom Blanchfield, No. 78 on the Barrron’s list, built his practice catering to business owners who sold their company and have their net worth tied up in common stock through the sale.
Most of his 100 family clients are in California and about a third reside in Orange County.
Blanchfield’s six person team, co-led by partner Alex Stimpson, skews portfolios towards conservative benchmarks.
“We tend to live in that space,” said Blanchfield, a 25-year veteran who manages about $1.36 billion with Stimpson.
Their average account size is $25 million, with a typical client’s net worth at $35 million.
Bank of America Merrill Lynch dominated Barron’s national rankings but UBS Financial Services leads the list of local managers with two.
UBS Pair
That includes Miramontes and Marc Foster, who works from offices in Newport Beach and is No. 93 on Barron’s list.
Foster, a 32-year industry veteran, said his team didn’t lose many clients in the latest stock market crash.
“We made some good calls in the crisis in 2009 and that helped create some good referrals,” he said.
Nationally, wealth managers saw a 97% retention rate in 2010, according to Barron’s.
Foster, who counts some 200 households as clients, caters to the wealthy. His largest accounts top $100 million and he has advised some family clients through four generations.
Foster tends to put his clients in traditional investment portfolios. He manages about $660 million in assets with an average account size of $3 million.
Foster owns his own moulding business in Costa Mesa. He said his perspective as a business owner has helped him read the economy from the ground floor.
“You get a real pulse of what’s going on when you own a business,” Foster said.
He recently added his son as broker and another younger professional to provide some long-term structure and continuity to his five-member team, he said.
Miramontes, who ranked No. 94 on Barron’s statewide list, said a renewed focused on customer service throughout UBS helped his team retain clients and increase market share last year.
Keeping in Touch
Seminars, lunches and informational sessions for clients have been the norm in the past few years.
“We haven’t lost a client in the last three years in what I consider a pretty tough market,” said Miramontes, who manages about $286 million in assets. “We did more business last year than we ever did before.”
He also follows up on the occasional meetings, checking in with clients every 45 to 60 days in a bid to ensure they understand his investment strategies.
“I think that’s what helped us through the last difficult stage,” he said.
About 98% of his clients are drawing monthly income from their portfolios, he said.
Strong returns and referrals have helped Pence Wealth Management increase business nearly 40% in the past year as assets under management have hit nearly $700 million.
That’s up 10% from December.
“Our business has grown dramatically,” said Pence, who was ranked No. 61 on the statewide list and 23rd among all U.S. women advisers by Barron’s in 2010. “One of the keys to that growth is our investment philosophy.”
She handles wealth advising and the management side of the business while her husband, Dryden Pence, is the chief investment strategist.
Cash-Flow Is King
The firm counts on a cash-flow strategy that uses a mix of exchange-traded funds, dividend-paying stocks and individual bonds to create income yielding portfolios.
About 65% of her clients are retirees, a “niche where people need us the most,” said Pence, who has 31 years in the industry.
The average account size at Pence Wealth is $2 million and a typical client has a net worth of $5 million, according to Barron’s.
Transition Time
Corporate downsizing and an aging population has helped Haussmann land more clients and rank No. 63 on the statewide list.
She targets retirees and those transitioning into retirement.
“They might not have realized they were in a position to retire,” said Haussmann, who was ranked No. 61 of all U.S. women advisers by Barron’s. “There’s a lot more of them now than there was in the past.”
She said the shock, dismay and panic of losing a job or leaving employment can turn into a positive change.
“We step in and counsel them.” Haussmann said. “We put together portfolios that will allow them to have comfortable retirement incomes.”
She manages about $840 million in assets with an average account size of $500,000. The firm has four other advisers and doesn’t set minimums for account sizes.
