By Steve Garmhausen

Ira Mark isn't making a market call -- he is just pointing out that historically, long bull runs in the stock market are succeeded by lengthy periods of cooling off. "If the S&P does 6% to 7% over the next 10 years, versus the 15% that it did over the past 10 years, how do you want to be allocated?" says Mark, whose Jericho, N.Y.-based Morgan Stanley practice, dubbed The Preserve Group, manages more than $4 billion of assets.

Speaking with Barron's Advisor, the Livingston, N.J., native reveals how a family tragedy forced him to fast-forward his career. He discusses his concerns about the market and economy, argues that history's lessons point investors toward diversification, and says stocks and bonds are no longer enough for many clients.

Why did you become interested in financial services? My father was in wealth management. He got started with a small regional bond firm in New Jersey. He specialized in tax-free bonds. I always enjoyed listening to him talk to clients on the phone. I just felt like it was something I could do and excel at, so I followed somewhat in his footsteps.

How did you break into the business? I interned at Prudential Bache's Baltimore offices while I was a junior at the University of Maryland, and I ended up doing very well. I then got myself an interview in the summer of 1991 at a regional bond firm in West Orange, N.J. -- Ryan Beck and Co.

I worked there for about a year. Unfortunately, my father became very ill at a young age, and I ended up leaving the regional bond firm and going to Smith Barney, in the summer of 1992, where I ended up taking over my father's practice unexpectedly in 1993 when he was unable to return to work. I had to grow up pretty quickly, for him and for my family.

Processing those emotions while taking over his business sounds really difficult. It definitely was. It was very challenging in the beginning, but it became very rewarding over time. I basically decided that the only way I was going to really succeed was by meeting with each client and asking them to give me an opportunity. I've stuck with that plan over the past 30 years. I've met, in person, probably 99 1/2 % of the people who have invested with me, and I continue to meet with them in person.

I assume you use Zoom calls and modern communication as well. I definitely use Zoom and dial-ins when necessary. But you can't really put a price on face-to-face conversations with someone. You can accomplish a lot more in a 15-minute face to face meeting than you can in a 30- or 40-minute Zoom, in my opinion.

Today you lead a 13-advisor team managing some $4 billion of client assets. What were the keys to building a substantial practice? Hard work, obviously; continuing to educate myself; and trying to create a difference in approach from other wealth advisors. The best way to do that is through portfolio construction and delivering risk-adjusted returns, especially in challenging times like what we're going through right now.

You moved to Morgan Stanley from RBC Wealth Management in 2020. Can you talk about why? At RBC I felt like I was limited to fixed income, and I really wanted to diversify and grow my practice. I felt the best way to do that was to be at a firm that had a better platform for all-around investing, whether it be diversified equities, fixed income, lending, cash management, and last but not least, alternatives.

Can you describe how your investment approach has evolved, especially in the past several years? What I've learned is that clients want to follow what the wealthiest families or family offices are doing. And if you look at that, the biggest family offices have over 50% of their assets in alternatives. Going back just a few years, it used to be that alternatives were geared for the 1%, the wealthiest people out there. Alternatives have evolved so much and have almost become mainstream. You had Blackrock's Larry Fink recently saying the 60/40 model is now 50/32/20. If you look at risk-adjusted returns and you educate yourself on how alternatives work, you'll see that the value add is the stability they can provide within a portfolio -- mitigating risk and adding solid risk-adjusted returns. Our platform at Morgan Stanley is probably second to none.

How would you describe your clients? Most are successful businesspeople. There are families of multigenerational wealth, retirees in Florida, entrepreneurs in California. It's a pretty broad mix of clients. The target of our practice is probably within the $5 million to $25 million range, but we don't really have minimums, and we're running a model that can be suitable for you whether you're at a million dollars or you're at $50 million.

What sort of alternative investments do you favor at the moment? A big part of it is multimanager, multistrategy hedge funds, because of their diversification and low correlation to everyday stock and bond markets. Private credit, which is an alternative for high-yield fixed income, is another area that I like a lot.

Do you invest with the best-known managers? Do you seek lesser-known funds? What's your approach? I feel that clients are most comfortable in any asset class with names that they recognize. So with alternatives, it's going to be names they know and recognize, with good, longstanding track records.

What are your clients most concerned about these days? The No. 1 topic right now with my wealthy clients is how to remain wealthy. In a world where you can talk about inflation at 3% or 3.5%, and hopefully it doesn't get to 4%, what can you do with your portfolio to keep it ahead of inflation? It can't be all bonds. As much as I love munis at a 4.5% tax-free rate, you can't continue to grow your portfolio and remain wealthy at a 3.5% or 4% inflation rate. You have to blend in diversified equities. You look at the historical average of the S&P 500 going back 100 years, and it's 9%, 9.5%, or 10%. And the third leg of what clients need, in my opinion, is a diversified alternative investment portfolio. There are 4,000 public companies, but there are more than 4 million private companies. I talk about names you're going to know and recognize, but there's also a whole other world out there that's not correlated to the traditional 60/40 world that everyone's used to. The 60/40 portfolio has worked over the past 15 years. That doesn't mean it's going to work over the next 15 years. So look at it as three buckets.

What's the level of concern among your clients regarding the recent roller-coaster market and recession fears? There's definitely a lot of nervous energy and concern. I try to put the situation into perspective. If you look back over the past 75 years, there have been 28 corrections. Of the 28, only eight have resulted in a bear market. The average bear market goes down 27% or 28%, and it could last nine or 10 months. But there's a 70% chance that it won't happen. So how do you want to be positioned if it goes one way or if it goes the other way? That leads us back to diversification.

What tactical moves, if any, have you made recently? At the moment, munis are yielding 100% of Treasuries, which is attractive. And the pretty strong possibility of a 40% federal tax bracket being reinstated would make munis more valuable to portfolios.

Sounds like you've been buying munis. Starting to. I don't have to tell you that 4.5% is over 9% if you live in New Jersey, New York, or California.

What else is on your mind right now, about the markets and the economy? The first thing that comes to mind is the possibility of a recession or bear market. Over the past 150 years, when the market has done what it's done over the past 15 or 16 years, it usually underperforms. I'm not looking to make a market call, but I can't stress the importance of diversification enough. If the S&P does 6% to 7% over the next 10 years, versus the 15% that it did over the past 10 years, how do you want to be allocated? The two-year Treasury is telling us that cash rates may start to come down. Clients have benefited from 4% to 5% yields on money markets or Treasuries. Six to 12 months from now it could be a different story.

Let's talk about your business. Can you share some of the key lessons you've learned over the years about running a business successfully? Communication has got to be at the top of the list, along with proper delegation of responsibility and remaining consistent with what we're trying to accomplish.

Did delegation come naturally to you, or was it something you had to learn? I had to learn, to understand that I have good people around me, and that we can play into each other's strengths. It wasn't the easiest thing to do, but I feel like I'm getting better at it. I'm trying to leverage the strengths of the different members of our team.

What do you consider to be your biggest business challenge right now? Remaining ahead of our competitors as the environment gets more competitive, and continuing to retain and grow our relationships as the team grows.

What do you do to relax and recharge outside of work? I like to spend time with my family, and I like to walk and golf. And I love the game of gin rummy.

Thanks, Ira.

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May 09, 2025 13:06 ET (17:06 GMT)

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