Morningstar Advisor - October/November 2010 - 20

Advisor Profile

A Model Practice
By Karen Dolan

Amid the downturn, Nick Giacoumakis has established a viable and growing business by sticking with key disciplines.

The temperature in the Boston area was 104 degrees when the power clunked out. In the darkened offices of New England Investment & Research Group, the stuffy air and rising heat couldn’t dim Nick Giacoumakis’ passion for his profession and the firm he founded in the suburb of North Andover. He has good reasons to be fired up. As many financial advisors were facing tumbling asset levels and disappointed clients in 2008 and 2009, Giacoumakis was adding new relationships throughout the downturn, enough to nearly overcome the impact to assets from the steep market decline. His revenues dipped just 3% in the aftermath of the financial crisis. Giacoumakis emerged from that period stronger than ever. His firm manages $500 million for 1,100 clients. In 2009, he made Barron’s 1,000 top advisors list. He remained on the list in 2010 and is gunning for the top 100 list next year, now that he’s crossed the $500 million threshold. He has achieved that success with a savvy business sense and an eye toward building an enterprise that can handle scale without compromising quality.
The Business Model

common error made by financial advisors when building their practices. “Take Harry, for example,” Giacoumakis says, describing a typical scenario. “He builds a book of 300 clients and hasn’t grown his service staff quickly enough. Balls start dropping. Monitoring slips. Harry is overwhelmed and crumbling by the weight of his success because there’s a lack of scalability and repeatability to his practice.” Giacoumakis has taken great pains to not underestimate the resources required to service his client relationships and monitor their accounts. He’s avoided that trap by growing staff in advance of clientele. His firm employs 13 people, including five planners, three in-house researchers, and several client-service representatives. The team has grown steadily along with assets under management since the firm’s founding in 1995. Several members have played key roles for 10 years or longer. There’s family involvement as well. Giacoumakis’ wife, Laura, contributes to the firm’s marketing and communication efforts; his teenage daughter spent this past summer scanning documents to support the firm’s paperless commitment.
The Investment Model

that feeds into eight model portfolios. Clients are ushered into the appropriate portfolio based on their individual needs and risk tolerance, allowing Giacoumakis and his research analysts to focus their time and efforts on staying on top of the markets, managers, and securities that make up the portfolios. The model portfolios allow the team to spread its highest-conviction thinking across all client portfolios and to move money around quickly and in a way appropriate for each risk level. Making decisions on eight portfolios, not 1,100, adds tremendous scalability to the practice. Giacoumakis and his investment team research and debate the holdings in the model portfolios with supplementary research support coming from the firm’s longtime broker/ dealer partner, Commonwealth Financial. The team holds weekly informal investment meetings and more-formal, documented monthly meetings. Debate among staff is welcome. “If everyone agrees, we’re not thinking,” he says.
The Tactical Model

Giacoumakis brings a sensible business mind-set to financial planning. He points to a

Giacoumakis has spent his investment career building and evolving an investment model

While the model portfolios keep a lid on the number of moving parts, Giacoumakis’ approach to asset allocation has more bells and whistles. He does not sit on static allocations and plain-vanilla stock/bond mixes. He’s been a big proponent of alternative

20 Morningstar Advisor October/November 2010



Morningstar Advisor - October/November 2010

Table of Contents for the Digital Edition of Morningstar Advisor - October/November 2010

Morningstar Advisor - October/November 2010
Contents
New on MorningstarAdvisor.com
Contributors
Letter From the Editor
What estate-planning strategies are you and your clients doing before the end of the year?
Next Steps for ETFs
Investment Briefs
Taking It Personal
A Model Practice
Find the Right Fit
Will REITs Put You in the Penthouse?
Prepare for the Worst
Tips for Common Family Situations
Might Makes Right
Built to Last
Four Picks for the Present
Tactical Strategies Miss Their Mark
Time to Hop on the Commodities Bandwagon?
Retailers Balance Caution and Catalysts
In Search of … Recession Survivors
Turmoil-Tested Small-Cap Funds
Mutual Fund Analyst Picks
50 Most Popular ETFs
Undervalued Stocks With Wide Moats
VA Sales Rise in Second Quarter
The Third Rail
Morningstar Advisor - October/November 2010 - Intro
Morningstar Advisor - October/November 2010 - Morningstar Advisor - October/November 2010
Morningstar Advisor - October/November 2010 - Cover2
Morningstar Advisor - October/November 2010 - 1
Morningstar Advisor - October/November 2010 - 2
Morningstar Advisor - October/November 2010 - Contents
Morningstar Advisor - October/November 2010 - 4
Morningstar Advisor - October/November 2010 - 5
Morningstar Advisor - October/November 2010 - New on MorningstarAdvisor.com
Morningstar Advisor - October/November 2010 - 7
Morningstar Advisor - October/November 2010 - Contributors
Morningstar Advisor - October/November 2010 - Letter From the Editor
Morningstar Advisor - October/November 2010 - What estate-planning strategies are you and your clients doing before the end of the year?
Morningstar Advisor - October/November 2010 - 11
Morningstar Advisor - October/November 2010 - Next Steps for ETFs
Morningstar Advisor - October/November 2010 - 13
Morningstar Advisor - October/November 2010 - Investment Briefs
Morningstar Advisor - October/November 2010 - 15
Morningstar Advisor - October/November 2010 - 16
Morningstar Advisor - October/November 2010 - 17
Morningstar Advisor - October/November 2010 - Taking It Personal
Morningstar Advisor - October/November 2010 - 19
Morningstar Advisor - October/November 2010 - A Model Practice
Morningstar Advisor - October/November 2010 - 21
Morningstar Advisor - October/November 2010 - Find the Right Fit
Morningstar Advisor - October/November 2010 - 23
Morningstar Advisor - October/November 2010 - 24
Morningstar Advisor - October/November 2010 - 25
Morningstar Advisor - October/November 2010 - Will REITs Put You in the Penthouse?
Morningstar Advisor - October/November 2010 - 27
Morningstar Advisor - October/November 2010 - 28
Morningstar Advisor - October/November 2010 - 29
Morningstar Advisor - October/November 2010 - 30
Morningstar Advisor - October/November 2010 - 31
Morningstar Advisor - October/November 2010 - Prepare for the Worst
Morningstar Advisor - October/November 2010 - 33
Morningstar Advisor - October/November 2010 - 34
Morningstar Advisor - October/November 2010 - 35
Morningstar Advisor - October/November 2010 - Tips for Common Family Situations
Morningstar Advisor - October/November 2010 - 37
Morningstar Advisor - October/November 2010 - Might Makes Right
Morningstar Advisor - October/November 2010 - 39
Morningstar Advisor - October/November 2010 - 40
Morningstar Advisor - October/November 2010 - 41
Morningstar Advisor - October/November 2010 - 42
Morningstar Advisor - October/November 2010 - 43
Morningstar Advisor - October/November 2010 - 44
Morningstar Advisor - October/November 2010 - 45
Morningstar Advisor - October/November 2010 - Built to Last
Morningstar Advisor - October/November 2010 - 47
Morningstar Advisor - October/November 2010 - 48
Morningstar Advisor - October/November 2010 - 49
Morningstar Advisor - October/November 2010 - Four Picks for the Present
Morningstar Advisor - October/November 2010 - 51
Morningstar Advisor - October/November 2010 - Tactical Strategies Miss Their Mark
Morningstar Advisor - October/November 2010 - 53
Morningstar Advisor - October/November 2010 - 54
Morningstar Advisor - October/November 2010 - 55
Morningstar Advisor - October/November 2010 - 56
Morningstar Advisor - October/November 2010 - 57
Morningstar Advisor - October/November 2010 - Time to Hop on the Commodities Bandwagon?
Morningstar Advisor - October/November 2010 - 59
Morningstar Advisor - October/November 2010 - 60
Morningstar Advisor - October/November 2010 - Retailers Balance Caution and Catalysts
Morningstar Advisor - October/November 2010 - 62
Morningstar Advisor - October/November 2010 - 63
Morningstar Advisor - October/November 2010 - 64
Morningstar Advisor - October/November 2010 - 65
Morningstar Advisor - October/November 2010 - In Search of … Recession Survivors
Morningstar Advisor - October/November 2010 - 67
Morningstar Advisor - October/November 2010 - Turmoil-Tested Small-Cap Funds
Morningstar Advisor - October/November 2010 - 69
Morningstar Advisor - October/November 2010 - Mutual Fund Analyst Picks
Morningstar Advisor - October/November 2010 - 71
Morningstar Advisor - October/November 2010 - 72
Morningstar Advisor - October/November 2010 - 73
Morningstar Advisor - October/November 2010 - 50 Most Popular ETFs
Morningstar Advisor - October/November 2010 - 75
Morningstar Advisor - October/November 2010 - Undervalued Stocks With Wide Moats
Morningstar Advisor - October/November 2010 - 77
Morningstar Advisor - October/November 2010 - VA Sales Rise in Second Quarter
Morningstar Advisor - October/November 2010 - 79
Morningstar Advisor - October/November 2010 - The Third Rail
Morningstar Advisor - October/November 2010 - Cover3
Morningstar Advisor - October/November 2010 - Cover4
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