TOP FINANCIAL ADVISERS
Michael Johnston’s business is a reflection of Orange County’s economy.
The financial adviser for Citigroup Inc.’s Smith Barney has clients who’ve amassed fortunes in the past decade in technology, medical devices and real estate.
The wealth of some have come from stakes in companies such as Broadcom Corp. and Yahoo Inc. Johnston’s biggest client is worth about $20 billion, he said.
The wealth of his 70 clients tends to fall in the $15 million to $50 million range, according to Johnston.
$2.1B Under Management
In all, Johnston has $2.1 billion under management.
He tops a ranking of the leading financial advisers here prepared for the Business Journal by Boca Raton, Fla.-based Winner’s Circle LLC, which ranks advisers based on its own formula that takes into account the amount of money managed, revenue generated for the firm and length of time in business, among other factors.
Johnston met half of his clients while working on underwriting deals for Citigroup, which bought Smith Barney’s former parent company Travelers Group in 1998.
Flush from hefty payouts and stock holdings, Johnston’s clients already have enough to retire on, he said. What they want is to preserve and grow their wealth, according to Johnston.
For Johnston, beating inflation over the long haul is the main concern, he said.
Strategy
He has a diverse strategy that touches on some 20 types of investments, including stocks, bonds, private equity, hedge funds and commodities.
He’ll put more money in a particular investment to capitalize on momentum, Johnston said.
But each client is treated differently.
Someone wealthy from real estate has to spread his or her investments differently than someone who got rich on stock options. The idea is to stay diverse, Johnston said.
A number of Johnston’s clients have engineering backgrounds. That’s a good fit with his own background.
Studied Engineering
Johnston, who studied engineering at Auburn University in his native Alabama, said the way he processes financial data is very similar to the thinking of an engineer.
Earlier in his career, Johnston worked for a regional telephone company, consulting with businesses on phone and data services.
His fascination with investing started when he was a kid growing up in Anniston, Ala., east of Birmingham.
Every time his family’s car stopped at a particular stop sign in town, Johnston said he would stare at a stock ticker screen on display at a local brokerage.
That curiosity ultimately brought him to where he is now, he said.
Johnston went on to Harvard Business School and earned a master’s in business.
Earlier in his career, he worked at San Francisco-based boutique investment bank Montgomery Securities, now part of Bank of America Corp.
He joined Smith Barney in 2002, originally in San Francisco.
Johnston is married with two children.
1. Michael Johnston
– Company: Smith Barney
– Location: Irvine
– Years in business: 12
– Education: finance bachelor’s from Auburn University; business master’s from Harvard University
