Fast Track: New hired hand riding herd over Wells Fargo’s assets

Wells Fargo & Co.’s stagecoach name and column-fronted branches evoke a venerable bank that has kept its credit discipline over the decades.

But that’s not good enough.

Responding to an increasingly competitive climate in which growth is in investment consulting, the San Francisco bank has raised and acquired $80 billion in private-client assets.

It has also hired hundreds of portfolio managers and brokers to manage the assets internally. For instance, it has added $11 billion in assets through its acquisitions of Ragen MacKenzie Group in Seattle and other firms in the West.

Unity needed

But to Dennis Mooradian, president of private-client services for Wells Fargo, there was something lacking: centralized quality control for all portfolio managers. Each manager typically set investment policy autonomously.

In October, he hired Alan R. Adelman away from First Union Corp.’s First Investment Advisers in Charlotte, N.C. Under Mr. Adelman’s leadership, FIA, which he founded in 1997, increased its assets under management to more than $55 billion, from $26 billion.

Those leadership qualities are already apparent to his bosses at Wells Fargo. “He’s the glue that pulls together the portfolio managers,” Mr. Mooradian says.

As executive vice president and chief investment strategist for Wells’ private-client services, Mr. Adelman, 47, supervises 70 portfolio managers and directs investment strategy for 200 others in 26 states.

That support is particularly important, since the financial markets have been in disarray since he came on board.

“In these difficult markets, he’s been a voice of reason,” Mr. Mooradian says. “Portfolio managers lose confidence in everything they’ve learned in the past.”

Mr. Mooradian says he becomes concerned when his portfolio managers avoid facing clients amid souring markets. That is where Mr. Adelman steps in – he feeds managers ideas to pass on to clients, and encourages more interaction.

P. Edwin Glass, president and CEO of Milwaukee’s Northwestern Mutual Trust Co., the investment subsidiary of Northwestern Mutual Life Insurance Co., worked closely with Mr. Adelman at First Union, and he says his colleague was a winner in past endeavors.

“Whatever we gave him to do, he got done, and his projects turned out successfully,” Mr. Glass says.

Bucking the herd

One way Mr. Adelman is making his mark is by bucking the herd.

“We think it’s a good time to be more aggressive,” he says.

Mr. Adelman has instructed his portfolio managers to allocate 70% of their assets to equities. But for the most conservative clients, he says, he keeps allocation to as low as 50% equities.

Mr. Adelman sets investment strategy by crunching numbers – inflation, market valuations, advancers and decliners. He also considers how asset classes affect one another.

Despite delving into the abstract, Mr. Adelman distinguishes himself by spending more time in airports than in ivory towers. During one recent week, he stopped in Scottsdale, Ariz.; Beverly Hills, Calif.; and San Diego.

He tries to make decisions that reflect the tax needs of individual investors. In other words, he uses derivative strategies rather than portfolio diversification to avoid taking big capital gains in overly concentrated portfolios.

Mr. Adelman took part in the equity derivatives program at the Columbia University School of Business.