Why we expanded our wealth management firm to Portland this year


One of the cool things about my shop is that we’ve got a national footprint in terms of name-brand recognition among investors. Not many RIAs can say that. But this recognition is pretty uneven across regions.

My partner Barry has a tremendous following in the Washington D.C. metro area thanks to his regular weekend column in the Washington Post’s business section. We get swamped when we go down there (no pun intended) and we’ve got an amazing base of clients in the area. That being said, Barry probably couldn’t get someone to help him change a flat tire just one state over in West Virginia.

The uneven nature of our readership applies to all of our well-known commentators – whether it’s Ben Carlson, Michael Batnick or myself.

One of the things we’ve learned from tracking the traffic across our various sites is that we tend to have the most readers (and, by extension, clients) in areas of the country where TAMI sectors flourish – Technology, Advertising, Media and Information Technology. This explains our disproportionately large following in places like San Francisco and Silicon Valley. TAMI cities tend to have the sort of high net worth heads of household who are avid readers and intellectually curious enough to be checking social media for finance and investing information.

And then there’s the Pacific Northwest, our fastest-growing client region. Barry and Kris, our firm’s director of financial planning, took a jaunt up to Seattle and Redmond last year and they were blown away by how many requests for meetings and visits came in. We can’t wait to get back there to visit with clients old and new.

Which brings me to Portland, the new frontier for our wealth management practice. It’s a market that is filled with smart, creative and interesting people – exactly the type of folks we like to associate with and whom we think we can help. It has the added benefit of being located in a state that is absolutely on fire. The Oregonian economy flat-out rocks right now.

Matthew Winkler writes at Bloomberg View:

The biggest recent news from Oregon has nothing to do with the armed occupation of a federal wildlife refuge near the high-desert town of Burns. It’s about the state’s economic health, the most improved in the U.S. last year.

The 27th-largest state, with almost 4 million people, had the best-performing economy in the nation measured by employment, home prices, personal income, tax revenues, mortgage delinquency and the publicly traded equity of its companies, according to data compiled by Bloomberg.

Oregon is one of the ten fastest-growing states by population in America (up 1.5% last year) and has a vibrant employment market that continues to draw in talent. The lower-cost of living than, say, San Francisco or New York is another great selling point for young people in the TAMI fields. The state had a 4.35% rise in personal income in the first 9 months of 2015 (3rd best in America) and created more jobs last year than 44 other states, according to Bloomberg.

This is fertile ground for financial planning and asset management and we want to be in a position to help our readership there. But knowing where you want to be is the easy part. The hard part is finding the right talent. Luckily for us, we found our man on the scene, Joey Fishman.

For a New York-based firm like ours, having the right people in local markets is the only way we’re going to succeed. Joey gives us boots on the ground in Portland, along with key personal relationships and a working knowledge of what’s happening in the region. He’s also a talented asset manager and advisor in his own right, which enables him to effectively communicate our process and portfolio strategy – one of the hardest aspects of our business, by far.

One of the things that the financial media gets wrong about the robo-advisor craze (fad?) is the nomenclature itself. The robo-advisors are not giving advice at all, as advice is inherently personal. What they’re doing is actually robo-allocation, which is a good thing in and of itself and we see a lot of use for this in the market. We’re pro robo-allocators.

But allocation is not quite the same as advice. Advice is delivered effectively when there’s a relationship in place and the advisor gets to know the advisee. And by “gets to know”, I mean becomes aware of all the psychological ticks and foibles that make the person tick. This is why it’s so important to us to have people in the places where our clients are – personal relationships are key to managing the emotional ups and downs of investing.

As I explained in A Portfolio is Not a Plan:

The difference between a portfolio that costs 1.5 percent and zero percent is negligible in the grand scheme of things if you have no idea how to act, implement, and react to varying conditions. If you can’t control yourself in the presence of news, data, opinion, regulatory changes and volatility – and know what’s important and what isn’t – then it really doesn’t matter how many basis points you’re paying for your portfolio, does it?

The data suggests that people are on their absolute worst behavior at the absolute worst moments. This cycle is inexorable. It is why markets function to begin with – people have to lose and the masses have to lose massively at major turning points. And they do. The dollar-weighted returns of even the best performing funds prove this every year. The free-ness of a portfolio thus becomes irrelevant, a triviality in the shadow of our colossal inability to act professionally.

So yes, portfolios are now free. But advice is invaluable. And having the right person on the ground providing it is why we think we’re going to make a positive impact in the Pacific Northwest this year and beyond.

Barry, Kris and I are headed out to Portland during the third week in March. We’ve just begun to set appointments so it’s still early. If you’d like to meet us, and Joey Fishman, during our week there, you can get in touch with Erika (at) ritholtzwealth.com via email or call (212) 455 9122.

We love meeting our readers as well as prospective clients when we visit a city. The Portland trip should be incredible. Hope to see you there next month!


One other thing I should mention – Kris and I are mega-fans of the IFC show Portlandia. We’re hoping for at least one moment of sublime weirdness during the trip – don’t let us down!

Learn more about Ritholtz Wealth Management here.

Full Disclosure: Nothing on this site should ever be considered to be advice, research or an invitation to buy or sell any securities, please see my Terms & Conditions page for a full disclaimer.