Daniel S. Schwartz

New Jersey-based wealth manager Daniel S. Schwartz has built a nearly $1 billion practice, The Alfa Group, part of Morgan Stanley's Global Wealth Management Group, by emphasizing a flexible, comprehensive approach to wealth management and focusing on a broad cross-section of entrepreneurial and family-oriented clients. The group is ranked No. 1 by assets under management in Morgan Stanley's Custom Portfolio program in the state of New Jersey, and fifth in the country.

The Alfa Group, which operates as part of Morgan Stanley's wealth management division, seeks above-market returns by anticipating possible scenarios and understanding risks and the interconnectivity of the world economy. The three most important parts of the Alfa approach to wealth management have to do with believing that the return of the investment itself is more important than the return on the investment; believing that emotional intelligence is needed to control the urges that get other people into trouble with investing; and believing that, while markets may be illogical, portfolio decisions need to be logical at all times to maximize the probability of success.

The Alfa Group uses a customizable asset-class approach, and Schwartz and his team believe that there are certain events they can adjust for that may improve return. But Schwartz also understands that an overemphasis on performance can be counterproductive. As wealth managers, the group incorporates a values-focused approach with a performance-oriented methodology. The idea of aligning resources and wealth to support client values is a fundamental precept of true wealth management.

Schwartz's flexible and imaginative approach has much to do with his background. His father was an automobile trader, and Schwartz himself became fascinated by finance along with cars (the Alfa Group is named after the high-performance Alfa Romeo). After majoring in economics, he joined the then-well¬known firm of Kidder Peabody as a financial advisor. It was at Kidder where he first came up with the inspiration for The Alfa Group, with a drive to become exceptional. "Right from the start I enjoyed it," he says. "But I was obsessed with doing better—better than Wall Street, better than my peers and better than the market, especially."

Now overseeing assets under management of nearly $1 billion, Schwartz looks back on a career that certainly has been "a cut above." One big reason: "We've always made sure that our moves from a business standpoint were made on behalf of the client first."

Schwartz left Kidder and joined Smith Barney. After 16 years there, he signed on with Morgan Stanley's wealth management division, and his team soon followed. "We believe that Morgan Stanley has a virtually unparalleled reach of cutting-edge financial products that give us the tools to do the best possible job for our clients domestically and internationally. The resources that we have available give us tools that other wealth managers simply do not have."

Schwartz has seen a great deal of Wall Street history—navigating five bear markets along the way. Starting at Kidder before the crash of 1987, Schwartz experienced the sales-focused orientation of that era's brokerage profession, and he later participated in the evolution and growth of wealth management. "I was much more comfortable with wealth management than with a sales focus," he recalls. "With wealth management, I thought we were starting to render a significant service to individual clients."

He sees wealth management, with its emphasis on positioning resources to fulfill "everything that is important" to clients and their families, as a further and perhaps final evolution in the financial advisory process. The Alfa Group provides a unique approach to client services, offering a full panoply of services from estate and retirement planning to charitable giving. Schwartz points out that Morgan Stanley's broad resources allow him to fulfill client needs internally for the most part. "When you are dealing with high-end wealth, there are many directions that you can adopt, and you can choose to emphasize many different parts of a portfolio," he says. "To do it right, you have to listen very carefully and then continually correct your implementation as the environment changes. Having so many resources available at Morgan Stanley helps with that."

-----------------------------------------------------------
Morgan Stanley and its Financial Advisors do not provide tax or legal advice, are not "fiduciaries" (under ERISA, the Internal Revenue Code or otherwise) with respect to the services or activities described herein, and this material was not intended or written to be used for the purpose of avoiding tax penalties that may be imposed on the taxpayer. Individuals are urged to consult their tax or legal advisor before establishing a retirement plan or to understand the tax, ERISA and related consequences of any investments made under such plan.

"Financial planning is one of many products and services offered by Morgan Stanley. Please consult your Financial Advisors for more information about any of our products and services."

Return to the advisor success story archive.

Return to this month's advisor success stories.