Originally created 07/14/97

Area offers choice of brokers



Investors in Augusta who want stock brokerage companies don't have to travel far.

Augusta investors have more than 100 brokers and eight traditional firms from which to choose, most offering similar services and products.

Many brokers say the individual relationship with a broker matters more than the firm represented. Most firms with branch offices in Augusta sell stocks, bonds, mutual funds, annuities and certificates of deposit.

And most of the firms report offering some level of financial planning to help clients sort through their financial choices.

M.A. Mullis, first vice president and branch manager of the Augusta office of The Robinson-Humphrey Co., said trust and compatible personalities matter more in a good relationship than a match of race or sex.

Clients don't always prefer dealing with someone like themselves. Women don't necessarily want to work with a woman broker, and members of ethnic minorities don't always seek out brokers of the same race, she said.

Robinson-Humphrey sponsors seminars to attract clients and brokers beyond the traditional white men. Mrs. Mullis said often, male stockbrokers will have more women clients than a woman broker.

"The crux of the matter is the individual with the money needs to do his homework, like interviewing doctors before making one your physician," said Mike Reese, vice president and resident manager of Merrill Lynch.

Augusta's oldest and largest firm, Merrill Lynch, is also the country's largest firm. One of the "nameplate" partners - before recent mergers squeezed his name off the letterhead - had a cotton brokerage in Augusta that served as the foundation for the company's local stock sales office, Mr. Reese said.

Merrill Lynch began selling stock to the public in the 1940s. A third of the branch's 31 brokers here have more than 10 years experience, Mr. Reese said.

As the country's largest Wall Street brokerage, Merrill Lynch is considered by many brokers as a typical "wire house," generating most of its business from stock orders. But Mr. Reese said nearly half the Augusta business comes from issuing loans, insurance and financial planning, which he says is vital for all clients.

"Everything that we do comes from the plan," he said.

Nearly every firm performs planning of some level of complexity and cost. Most Augusta branches though, send the data to their firms' home offices for analysis by computer or accountants and lawyers.

"We recommend investments based on the plan's results instead of doing the stock of the day, the trade du jour," said Dudley Baird Sr., branch manager at Wheat First Butcher Singer.

Plans also help brokers understand each client's tolerance for investment risk, according to Mr. Baird.

"This is a risk-oriented business, no matter who you do business with," he said. His goal, he said, is to prepare clients for the minor risks while avoiding what he calls financial train wrecks.

While planning is a growing trend, some branch offices - such as Prudential Securities, A.G. Edwards, and Interstate/Johnson Lane - do the bulk of their business in securities and mutual funds, according to their managers.

Rick Preston, branch manager and first vice president at Interstate/Johnson Lane, said the Augusta office he runs processes securities trades for a number of institutions, a traditional function of wire houses. Handling institutional orders provides brokers information, he said.

"In some ways it's very good for retail clients. Because you are in touch with the institutions, you know what's going on," he said.

Many firms with offices in Augusta regularly underwrite initial public offerings - the ultimate institutional trade. A.G. Edwards is one of the top five underwriters, according to Bill Gibbs, branch manager.

Working for a top underwriter gives brokers like Mr. Gibbs access to stocks of new, growing companies at theirinitial offering price. Still, he steers away from such volatile stocks in favor of the more stable blue chips of the Dow, he said.

Clients of Augusta's newest branch, J.C. Bradford, also benefit from a parent that often participates in underwriting syndicates, providing clients with municipal bonds before institutional investors buy them all. According to Scott Sewell, investment vice president, "They have a real strong inventory of tax-free bonds in the South."

Edward D. Jones & Co. brokers, though, usually sell mutual funds and annuities rather than individual securities, according to Mike Keck, investment representative.

"I'm not a stock jockey. Very few of us at Jones are considered a stock jockey," he said.

Jones brokers are different in two other respects, too. All six Augusta-area brokers have separate offices, and they conduct most of their business at the client's home or office.

"We make house calls," Mr. Keck said. "I've had many clients tell me they like our personal approach."

In one traditional brokerage office, brokers often share ideas or consult each other's various areas of concentration, according to Jon Simowitz, vice president and branch manager for Prudential Securities.

"What makes us different here is we are almost a team," he said.

The five veteran brokers Mr. Simowitz manages have some of the highest sales volume in the Augusta-Athens region, he said.

Augusta also ranks as The RobisonHumphrey Co.'s highest concentration of assets outside of Atlanta, Mrs. Mullis said.

As evidence of Augusta's potential, brokers site the number of firms setting up offices here in recent years. Besides Bradford's office that opened this spring, the Wheat First branch opened in 1995, and the Edwards office opened in late 1993.