Morningstar Advisor - Fall 2007 - (Page 25)

Bill Campbell, Principal, Slayton Lewis possible, while letting them know exactly how the individual stake affects the overall portfolio. Another ETF advantage is less obvious, but still of value. Campbell believes that clients perceive mutual funds and exchange-traded funds differently. In his opinion, once clients have more than $1 million in investable assets, they’re likely to view standard open-end mutual funds less favorably, thinking that the fund format isn’t sophisticated enough for their needs. Hedge funds appeal to these types of clients, but $1 million or more investment minimums are problematic for clients with less than $10 million, Campbell says. ETFs, however, fit the bill, allowing Campbell to customize portfolios precisely without the huge minimums required by hedge funds. So far, his clients have embraced the ETF strategy, particularly when Campbell compares the costs with actively managed open-end funds. How he caught our eye: The two-office, oneintegrated-staff approach to managing his business. Career path: Slightly non-linear. After a stint as an actor and stand-up comic (he entertained the studio audience for the “Donnie and Marie Show”), Campbell entered the investment industry as a registered rep for a small brokerage firm in 1980. He started a fee-only planning firm, one of the first in the country, in 1985 and formed Slayton Lewis in December 2000. Campbell received a bachelor’s degree in economics from Westminster College in Salt Lake City and an MBA from the University of Chicago. He’s a Certified Financial Planner and has served as an adjunct faculty member for Westminster’s Gore School of Business, where he also sits on the Financial Services Advisory Board. Personal: 51, single, divorced. Some favorite ETFs: Vanguard Europe Pacific VEA, Vanguard Emerging Markets Stock VWO Hooking the Big Ones Slayton Lewis manages more than $100 million for 55 clients, and Campbell believes that 80 is the upper limit for maintaining the level of service he wants to provide. Yet that restraint doesn’t rule out future growth for his firm. Campbell considers his business structure as a “pod approach” and says that he and his current team represent the first pod. He could expand by purchasing or partnering with another principal who would serve a second pod of clients with a similar support structure. But one pod or more, Campbell is happy with his decision to angle in two large ponds, and the move to Chicago has already paid off in terms of new (and wealthier) clients. Approximately 20% of his current assets under advisement have come from the Chicago area. And, as Campbell reveals, Chicago contains “bigger fish.” K David Harrell is a former Morningstar fund analyst and has held various editorial and product development roles at Morningstar. balances. By using ETFs and—when appropriate—individual bond holdings, Campbell says he’s able to keep the total cost to clients, his fees plus total investment management costs, to just 135 basis points a year. ETFs are also useful when trying to diversify around a huge stake in an individual stock that a client might own. As is the case with most planners, his preference would be to deal strictly with cash or malleable portfolio positions, but some clients come through the door with large stakes in individual stock issues. And for reasons ranging from sentimentality to tax liabilities, they’re not always willing to sell these positions. As best as he can, Campbell attempts to balance them out. For example, for a client who owns a large stake in an individual bank, that holding might represent all of the overall portfolio’s financials exposure. It’s not the ideal solution, and Campbell will always show the client what he would do if that position weren’t untouchable. But he accommodates these clients as much as MorningstarAdvisor.com 25 http://MorningstarAdvisor.com

Table of Contents Feed for the Digital Edition of Morningstar Advisor - Fall 2007

Morningstar Advisor Fall 2007 Features Departments Letter from the Editor Inbox 10 Years After: Developing Markets Make Progress Research Briefs Investors Should Adjust Their Home Bias Few Mutual Funds Exhibit Serial Correlation Valuating ETFs, the Equity Analyst's Way It’s All About Location See the World (Differently) The Return of the Global Flexible Investor Map of International Value Sound as a Loonie? Fair Exchange In Their Own Worlds A Good Read Putting Their Heads Together Buying Protection Scoping Out Easy-to-Use Funds Finding Good Stewards Consumer Firms Go Global Mutual Fund Analyst Picks Undervalued Stocks Most Popular Variable Annuities New at Morningstar The Whole Wide World

Morningstar Advisor - Fall 2007

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