This week, our firm was privileged to be named one of the top 50 fastest growing RIAs in the country by Financial Advisor magazine. It is quite an honor, and we appreciate it greatly.
According to FA Mag, we are the sixth fastest growing firm in the country, as of the end of calendar year 2015.
I could not be more proud of what we have accomplished in less than three years: We launched with a modest asset base, and have grown steadily since then. And we did it the right way, by creating intelligent, low cost, index-based, global asset allocations models; by establishing ourselves as thought leaders on all manner of issues that impact investors, and by embracing the fiduciary standard.
These came naturally, as they are things that we believe deeply in; reflecting these core values in our firm as we grew was simply a natural outgrowth of a long held philosophy that colors everything we do.
A lot of serendipity has affected the way the firm was created and grew. I met Josh at a conference in San Diego, we hit it off immediately. Josh met Mike on the LIRR; Kris grew up in the next town from where I was living (we had never met), but he found us online. There was a tremendous amount of good fortune to this very disparate group coming together as a single team, and creating some lightning in a bottle.
As the old man in the office, I have had the privilege of watching a brilliant collection of young, savvy individuals coalesce into a finely honed machine. The partnership of the firm has evolved into a top notch group of innovative financial experts, each of whom has vaulted to the top of our profession. It is an amazing team, one that continues to grow, to develop their professional skills, and to work continuously on behalf of our clients.
Josh Brown is the CEO of the firm. Since we met, I have watched him mature into an outstanding author, a brilliant thought leader, and the person who executes our vision for the firm. He is overflowing with great ideas, yet stays focused on what we need to do right now to serve our clients best interests today. He is also the funniest, smartest person you can follow on Financial Twitter.
Kris Venne directs all of the financial planning for the firm. Under his direction, we have tightly integrated this aspect of wealth management into every step of our process. He is integral to training FAs on the process we use to onboard prospective clients. Kris drove the focus of making sure financial planning and the prospect’s best interests are key parts of our process even before they become clients of the firm. Kris began as a junior FA, and grown into the role of Director of Financial Planning. His vision colors every single interaction with clients, from when they first reach out to us to when they begin to draw down their portfolio in retirement, and everything in between.
Michael Batnick has blossomed in one of the savviest CFAs in the world of asset management. His regular postings on markets, investing history, or explaining why so many myths investors hold dear are just meaningless noise is simply must reading for investors and industry professionals alike. He has wisdom and sound judgment far beyond his years, making it easy to forget he is still young with decades of his career ahead of him.
That group, plus me — I serve as Chairman and Chief Investment Officer — is our executive team. (There are another dozen folks on our team that I can mention who have been crucial to our success, but that would make this 5000 words long; I will save that discussion for another post).
We have robust internal debates as to the best way to accomplish our clients’ goals. Ultimately, we reach an agreement on all the big points: We keep coming back to important behavioral issues, and why controlling investors’ worst impulses is crucial. We see our jobs as educating clients, prospects and the public as to well established academically proven facts of investing:
1. If you want to avoid the downdrafts you will in all likelihood avoid the upside; Without things like risk, fear, volatility and angst, returns would be meaningless.
2. No one has shown an ability to consistently get out before pullbacks, both minor (10-20%) or major (20+%) and then get back in. (And thats not counting up the costs & taxes of such an exercise);
3. Volatility is a feature, not a bug, of markets. Its inherent and unavoidable. Those saying the opposite are trying to sell you an expensive and (most likely) nonperforming product;
4. Risk and reward are two sides of the same coin. Easy, emotionally comfortable, and lacking in volatility asset classes (e.g., T-Bills) — have no real drawdowns; they also lack any real gains. Clients make money in equities because it is difficult and uncomfortable.
5. The future is unknown and inherently unknowable. Plan accordingly.
We get paid to inform clients of all this, to manage their expectations and to make sure their behavior reflects what the data has overwhelmingly demonstrated is true.
We are coming up on our 3 year anniversary, and I could not possibly be more proud of what this firm has evolved into.
If you are an investor, and are not sure if your manager or broker does these things, you should talk to us. You should be speaking with a qualified financial advisor to figure out what is the best way to handle your own financial situation.