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the evolution of financial intelligence
Custom Living By Design
the Bespoke issue
28
wo rt h .c o m
volu m e 23
|
edition 01
Chicago, IL
Leading Wealth Advisor
Altair Advisers LLC
Richard K. Black, Managing Director
What qualities and credentials make
for a good investment adviser?
By Richard K. Black
A recognized brand, a preferred
address with breathtaking lobby
views, sentimental television ads,
sponsorship of national golf and
tennis championships: Such nice
things denote a certain cachet, but
what should you really look for when
choosing an investment adviser?
Unfortunately, the job of getting
past all the marketing to determine
how an adviser makes investment decisions and serves clients lies with the
investor. That said, however, the most
important qualifications are straightforward: Your investment counsel
should be independent and objective,
with a strong team of experienced
and credentialed advisers.
As a starting point, look for a firm
that will put your interest first and
serve you as a fiduciary. All registered investment advisers (RIAs) are
regulated by the SEC under the
Advisers Act of 1940 and are required
to act as fiduciaries for their clients.
Typically, brokers are held to a much
lower “suitability” standard of care for
clients, as they are compensated
through the sale of investment products, not by giving advice. Telling the
difference can be confusing, as both
types may call themselves “wealth
advisers,” but these differences are
critical. You wouldn’t work with an
attorney or accountant who wasn’t
acting as a fiduciary, and you should
insist on that same standard from
your investment counsel.
This requires a little digging on your
part. Although fiduciaries must put
your interests first, they can also have
conflicts of interest, so long as these are
disclosed. There is an old Russian proverb made famous by Ronald Reagan
during arms control discussions with
Mikhail Gorbachev: Doveryai no proveryai, or “trust but verify.” In this case,
the best way to verify is to visit the
SEC’s website, adviserinfo.sec.gov, to
view a firm’s Form ADV. RIAs must disclose conflicts on the ADV Part 2A or
on their “brochure.” The required format aims to make disclosures clear and
easy to understand. A careful review of
that information is the single most important part of your due diligence process. Pay particular attention to
fee-sharing arrangements from other
activities or affiliations.
The next step in due diligence is to
determine the investment skills and
qualifications of the investment team.
Pay attention to key members of the investment committee. Certain credentials
can be good indicators of an individual’s
financial and investment knowledge.
The CFA (Chartered Financial Analyst)
and CAIA (Chartered Alternative Investment Analyst) designations are
obtained after rigorous multiyear
exams. In addition, client service professionals should have the CFP (Certified
Financial Planner) certification, obtained after completing exams covering
investments, income and estate taxes,
retirement planning and insurance.
Beyond these credentials, an investment adviser should also have a broad
range of experiences and backgrounds,
often in law, accounting, banking and
finance. Such crosstraining enables
the adviser to fully understand the
larger accounting, tax and legal implications of a client’s particular circumstances and can add real value.
Finally, conduct a personal interview. Ask yourself if the people you
are considering understand your goals
and objectives. The best advisers are
also interviewing you. They know their
process and want to ensure that your
needs align well with their capabilities
and strengths.
Sadly, many clients overlook these
simple due diligence steps in their
selection process and enter into a relationship with a misunderstanding of
their adviser’s incentive structure and
obligation. In the end, tickets to the
Masters are nice, but what is that really
costing you?
First and foremost to consider are
the adviser’s independence and technical skills. Freedom from competing
priorities puts an exclusive focus on
you, the client, and avoids the conflicts
of interest that are pervasive in the
investment industry.
live
“First and foremost to consider
are the adviser’s independence
and technical skills.”
How to reach Richard K. Black
grow
Please call me at 312.429.3000 to
set up an initial appointment.
make
—Richard K. Black
Altair Adv ise rs LLC
Left to right: front row-Richard K. Black, Steven B. Weinstein, Bryan R. Malis; back row-Rebekah L. Kohmescher, Donald J. Sorota, Jason M. Laurie, Michael J. Murray
About Altair Advisers LLC
illustration by kevin sprouls
Altair Advisers provides independent investment counsel to wealthy individuals, families and foundations. In
the commission-dominated world of financial services, Altair stands apart as a firm committed to providing
objective advice that is free from conflicts of interest. The firm serves as “chief investment officer” for clients,
ensuring all investment decisions reflect each client’s full financial circumstances. Altair and its principals
are consistently recognized as top independent wealth managers by Barron’s, Worth*, Financial Advisor and
Wealth Manager magazine, among others.
Assets Under Management
$3.5 billion+ (as of 9/30/13)
Compensation Method
Asset-based and fixed fees
Minimum Annual Fee
$30,000
Primary Custodian for Investor Assets State Street
Minimum Net Worth Requirement
$5 million (in investable assets)
Professional Services Provided
Planning and investment advisory services
Largest Client Net Worth
$1 billion+
Association Memberships
Chartered Alternative Investment Analyst Association, Chicago Estate
Planning Council, CFA Institute, CFA Society of Chicago and FPA
Financial Services Experience
13 to 35 years (managing directors)
Website Email
www.altairadvisers.com
info@altairadvisers.com
*2004–2008 (the top advisor designation in Worth ceased in 2009).
Altair Advisers LLC
303 West Madison Street, Suite 600, Chicago, IL 60606
312.429.3000
worth.com
f e b r ua ry- m a r c h 2 0 1 4
085
Steven B. Weinstein, CFA®, CFP®, JD
President & Chief Investment Officer
Richard K. Black, CFP®, JD
Managing Director
Rebekah L. Kohmescher, CFP®, CPA
Managing Director
Jason M. Laurie, CFA®, CFP®
Managing Director
Bryan R. Malis, CFA®, CFP®
Managing Director
Michael J. Murray, CFA®, CFP®, CAIA®
Managing Director
Donald J. Sorota, CFP®, CPA
Managing Director
Anna Nichols
Director of Communications
Altair Advisers LLC
303 West Madison Street, Suite 600
Chicago, IL 60606
Tel. 312.429.3000
info@altairadvisers.com
www.altairadvisers.com
REPRINTED FROM
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the evolution of financial intelligence
Altair Advisers LLC Insurance Group is featured in Worth® 2014 Leading Wealth Advisors™, a special section in every edition of Worth® magazine. All persons and firms appearing in this
section have completed questionnaires, have been vetted by an advisory group following submission by Worth®, and thereafter paid the standard fees to Worth® to be featured in this section.
The information contained herein is for informational purposes, and although the list of advisors presented in this section is drawn from sources believed to be reliable and independently
reviewed, the accuracy or completeness of this information is not guaranteed. No person or firm listed in this section should be construed as an endorsement by Worth®, and Worth® will not be
responsible for the performance, acts or omissions of any such advisor. It should not be assumed that the past performance of any advisors featured in this special section will equal or be an
indicator of future performance. Worth®, a Sandow Media publication, is a financial publisher and does not recommend or endorse investment, legal or tax advisors, investment strategies or
particular investments. Those seeking specific investment advice should consider a qualified and licensed investment professional. Worth® is a registered trademark of Sandow Media LLC.
See “About Us” for additional program details at http://www.worth.com/index.php/about-worth.