Elite Hedge Fund Manager Guides Student Management of Active Fund: Q&A with Robert Scannell, MBA, JD, CFA®

Robert Scannell, MBA, JD, CFA® will be co-teaching the Student Managed Investment Fund course at GGU in which students choose investments for an active fund. Scannell will bring his experience to the class, which includes starting and running the Tradewinds Investment Management, LP, an emerging-market hedge fund that peaked at $400 million and gained 22% per annum over 20 years.

Would you give us a brief overview of your education and career?

I earned an MBA from Penn State, a JD from Purdue, and later became a CFA® charterholder. I spent 10 years at Merrill Lynch in fixed income sales. I also established and ran a hedge fund for 20 years.

What do you bring to the students based on this experience?

Investment management is part art and part science and most business schools just teach the science — it’s really the same everywhere. They give you the tools. The art side of it is about how and when you employ the tools. My hope is to add perspective on the art side, having “been there and done that.”

There is no substitute for real-world experience and that is what the Student Managed Investment Fund course is all about. By managing an active fund they get real experience, and I will bring mine to the discussion.

Robert Scannell

Tell us about running the hedge fund.

Tradewinds was one of the first emerging market funds in the US, and it was wonderful. At the time I started the fund the Berlin Wall had come down, and socialist and communist governments wanted to move to a capitalist model. We traveled around the world and looked for unusual securities and situations. During that time, most emerging market countries exchanged debt they had defaulted on years earlier for new bonds, and if you understood that process it was extremely profitable. These sorts of trades helped us generate returns that were in the top 10% of global alternative asset managers (i.e.: hedge funds) from 1994-2015. Besides making money, we witnessed and participated in an economic renaissance around the world. The fund closed after twenty years because I was simply tired and the opportunities had diminished — alas, that is what happens to new markets.

We investigated investment opportunities at the country- and government-levels, talking to the finance ministers and central banks for macro information. Then we’d go to company-level analysis and that experience will play into the Student Managed Investment Fund class.

 “I teach students to always look for corroborating evidence. As Ronald Reagan said during nuclear negotiations with Russia, you want to “trust but verify.”

What did you learn over the course of your travels and how does that translate to students?

The biggest thing is that you learn over 30 years that the markets are a merry-go-round and that cycles repeat. You look for characteristic points in the cycle at which you want to do certain things. Where are we in the cycle of economic growth in the U.S.? The answer is that we are something like 8 years into a 5-year cycle. That is a joke of course, but the point is that the current economic expansion is one of the longest on record, and we are closer to the end than the beginning. This may color the investment decisions we make in the Student Managed Investment Fund course. We’ll probably want to err on the side of caution.

I also learned that people are the same all over. They are economically motivated in the same way, and they have the same flaws in a business context: it is not uncommon to run into lies, fraud, and exaggeration. You learn to be cynical and cautious about what people tell you.

You also learn that sometimes you have to throw out the investment research playbook. A good example is that at one point we had a big investment in Gazprom, the biggest company in Russia and one of the biggest energy companies in the world. Besides the fact that it was cheap, the biggest reason we owned was that we knew that everyone in the Duma owned it as well! And lo and behold it ended up moving much higher.

What is it like to have a fund, day-to-day, when you are in the domestic office?

A client from San Francisco once came into my office for a meeting. He called the next day and was troubled: “I didn’t hear anything going on in your office.” He had a mental image, probably from Hollywood, of computer screens and screaming traders. By contrast, our office was like a monastery. We just read research and tried to get smart. It is not what most people think. At least in our case, being a fund manager was more like being an analyst at the CIA.

Based on your real-world experience, how do you teach students to detect exaggeration when they are sitting at their office desks?

Well, one way is by accumulating experience and learning from your mistakes. Like we said earlier, there is no substitute for experience.

But more broadly, I teach students to always look for corroborating evidence. As Ronald Reagan said during nuclear negotiations with Russia, you want to “trust but verify.”

I also urge investors to get out there and see for yourself. If you are researching a company, walk the factory floor and speak to everyone you can. Speak to the company officers, the Directors, the customers and especially to competitors. I am a big believer in getting up close and personal. It is much harder to bluffed in person than it is on the phone.

What is your understanding of Russia’s macroeconomic and political vector since the 90s? Are we moving like the U.S. from robber barons or oligarchs to managed capitalism?

One vision is that Russia is simply a mutant capitalist country and a mutant democracy; they are sort of a failed experiment in evolution from communism to democracy. Another theory is that it’s a slow and ugly process, but they are gradually evolving. Sometimes it’s hard to tell. It’s interesting that they look at a lot of what goes on here in the U.S. and call it legalized, sanitized corruption. For example, the pharmaceutical industry spends billions on lobbyists and on political candidates and the result is our insane healthcare system. Is that a healthy capitalist economy in action or is it a form of institutionalized corruption?

“The biggest thing is that you learn over 30 years that the markets are a merry go round and that cycles repeat. You look for characteristic points in the cycle at which you want to do certain things.”

Do they eventually go from robber barons to a more respectable model? I hope so. Historically, there is a scrum for money and the winners eventually want to memorialize themselves, so they build foundations and museums and universities. An interesting case in point is Leland Stanford, who was reviled as a Robber Barron at the time he founded Stanford University. Hopefully, over time we’ll see a similar pattern in Russia, where oligarch money is recycled in positive ways for society.

Being that you and Dave Kaczorowski, who will co-teach the class, have so much real-world experience and are CFA® charterholders, how do you teach students to make their own decisions and reach their own investment decisions? Is it training wheels?

In the context of this class, we are not going to hand them a pile of money. We are going to be involved in every decision but want to give them as much responsibility as they can handle. We want to give them the tools, teach them, and then let go of training wheels. That is a perfect analogy.

We asked Robert Scannell the top three things he will bring to students…

  1. See the big picture and not get lost in minutiae.
  2. Take a real-world perspective: Many students at GGU are in the workforce, and they want to change their career. There are major changes happening in finance that will affect their future and we want to speak to some of those issues. For example, there is a powerful trend away from active portfolio management toward passive management (in the form of index funds). Also, the U.S. federal deficit and entitlement spending are both exploding, and this will eventually have huge implications for financial markets. These are tangential issues for the class but we’d like to try to weave them into the discussion.
  3. Infuse them with my enthusiasm for the investment game. It is like being a child on a treasure hunt every day.

More About Robert Scannell

Robert Scannell is the founder of Tradewinds Investment Management, LP, which from 1994 through 2015 managed numerous funds investing in emerging markets, distressed assets and healthcare. Tradewinds’ flagship fund ranked in the top 10% of funds globally over its 20-year history. Prior to founding Tradewinds, he spent 9 years in institutional fixed-income sales with Merrill Lynch Capital Markets. He holds a BA and MBA from Penn State University, a JD from Concord Law School at Purdue University and is a Chartered Financial Analyst. He also holds an MSc in Pharmaceutical Bioengineering from the University of Washington and has completed programs in drug discovery, drug development and clinical trial management at UC Berkeley, UCSF, and the University of Chicago, respectively.

CFA® (Chartered Financial Analyst) is a registered trademark owned by CFA Institute.

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How to Set Your Fee as a Freelancer in the Gig Economy

By Marion McGovern
Founder of M Squared Consulting

Blog editorial note: In a recent blog post here, the director of GGU’s Small Business Program Programs pointed out that all of us will be “entrepreneurs,” working for ourselves. at one point in our lives. Price setting is part of any business venture, but freelancers such as Web developers, creative professionals, or digital marketers are not necessarily MBAs. In the new Gig Economy, these “entrepreneurs” have to know how to set fees – or whether or not to charge an hourly or project rate – as much as how to draw attention with blogs or profiles on LinkedIn or UpWork. Marion McGovern, the author of Thriving in the Gig Economy and a recognized expert on the subject, provides some answers on how much to charge for professional services.

Recently, there was a great article in Medium advocating that all freelancers adopt rush fees. The idea is that urgent projects require special attention that may shuffle the priorities of their existing workload. So, between the extra hours and other client considerations, a premium is due. I heartily agree, not only with the premise but also with the idea that one set price is seldom the answer when pricing a project. There are many considerations that come into play, not the least of which is its urgency. In my recent book, Thriving in the Gig Economy, I point out some other important considerations:

Risk and return are directly correlated. The more risky a project is, whether due to the scope or aggressive goals, the more it should pay. It may seem to some that you are taking advantage of your client; but, the truth of the matter is, a project that could be doomed for failure will not be good for your reputation either. Turnaround situations are a case in point. The potential for failure is high so the rewards should be as well. Conversely, if a project is very low risk, because you have done something similar a thousand times, then a lower fee may be warranted.

Capital formation is a long-term investment. If an engagement is going to build your intellectual capital by broadening your skill base, you should be willing to do it for less than you might otherwise. Because in the long run, you become more marketable and potentially can command higher fees because of the upskilling. For example, launching a project for a different type of branded good, via a new channel, or in a new geography or country could open you up for a whole new array of opportunities. Consider it an investment in your practice and price it accordingly.

Car-sharing firms and rental cars charge differently. Denis Russel, the co-author of my first book, A New Brand of Expertise, had a great pricing analogy for consultants that compared the difference between cabs and rental cars. Today, ride-sharing companies may be the better example.  The idea is that people use Lyft rides and rental cars for different purposes. Uber charges much more per mile than a rental car, since it is a short stint with convenience and urgency at a premium. Similarly, a client who wants a small urgent project yesterday, versus one who is open to a 6-month study should have very different pricing algorithms.

The 1% rule for setting consulting fees helps. Here is another handy rule of thumb; a person’s daily fee should be 1% of his/her equivalent annualized salary. A marketing consultant, who feels $200k would be the going rate for her expertise, should then charge $2000 per day for her services or $250 per hour. A more junior person, who could command $80k per year, should charge $800 per day or $100 per hour. That said, though, keep in mind it is the work, not your pedigree that should determine the price.

Anchor clients deserve a deal. Before the retail world was so disintermediated by online selling, the estate business would refer to the primary retailer in a mall as the anchor tenant. Not only was that key store bringing in the shoppers, they were also paying a significant portion of the rent. An anchor client is one that pays your rent, so to speak, by giving you recurring business. Having that project year in and year out from that one client is a wonderful thing. Some consultants may want to increase the fees after a few years. Unless your costs have risen dramatically as well, resist that impulse. Being able to plan your year with a known piece of work on the books is a luxury for some, and one that should be managed carefully.

Too often freelancers may default to a standard hourly option, but there are many others. Some may or may not be possible if you are working through digital talent platforms.

Government contracting is not for the faint of heart. The state and federal governments are two of the largest consumers of consulting services. The General Services Administration spends about $50 billion annually, much of it earmarked for small businesses. However, doing business with the government as an independent contractor is not easy. No surprises there… To be eligible to win government contracts, you will first need to obtain through Dunn & Bradstreet a D-U-N-S number, a unique nine-digit number. In many cases, you may need a security clearance. You will also need to register with the System for Award Management (SAM). If this seems a bit complicated, that is because it is.

In addition to these considerations, there are also many ways to structure fees. Too often freelancers may default to a standard hourly option, but there are many others. Some may or may not be possible if you are working through digital talent platforms.

Check out my book for more details on pricing so you can better appreciate the beauty of the art.

Marion McGovern’s will be speaking about her book at GGU on Monday, August 13 from 12-2 pm (Rm. 5210). Online registration is required for this special “book review” event. Follow GGU on Twitter or Facebook for registration information when it becomes available.

More About Marion McGovern

Marion McGovern, author and entrepreneur, is a recognized expert on the Gig Economy.  She founded M Squared Consulting nearly 30 years ago, which was one of the First Gig Economy companies before the term was even coined.  She also started an independent contractor compliance company, Collabrus. Now, she is an active Board member and mentor to CEOs. Her new book, Thriving in the Gig Economy was published in July 2017.  Since then, she has appeared on numerous radio shows, including Techonomic, Wall Street Business Network, and School for Start Ups, as well as podcasts including Nerdstalker, Money Matters and Business radio.  She recently presented to the International Women’s Forum and was a keynote speaker at the Staffing Industry Analysts, Collaboration in the Gig Economy conference in September 2017.

Learning Sell-Side Finance: Students Manage an Active Investment Fund at Golden Gate University


If you want to move from the sell-side to the buy-side in Finance or get bankable experience you can use to get a first job in the field, the Student Managed Investment Fund course can be a pillar of your career development. This fall, students in the MBA or MSF programs who take the class will get hands-on experience in portfolio management and security analysis with an active fund with a substantial endowment. The course is taught by Dave Kaczorowski, CFA® who worked in investment research for seven years and Robert Scannell, CFA® who founded and ran Tradewinds Investment Management, a $400 million hedge fund. The course was developed by Professor Kaczorowski and Professor Andrea Anthony, PhD, Finance and Economics Department Chair, and funded through the generosity of the Golden Gate University Board of Directors.

Wall Street in the Classroom

“When it comes to learning how to invest, there is no substitute for managing real money,” says Professor Kaczorowski, who also serves as Academic Program Manager at GGU. “The emotional attachment of having dollars at stake is crucial and better prepares students for the real world. From informal observation, students that are working with an active fund can be more tentative at first, but over time get accustomed to the risk of losing real money.  That is the situation that buy-side investors face every day.”

In the Student Managed Investment Fund course, students will start by choosing a sector of the U.S. economy to cover, and deliver a report on the macro trends in that sector.  Then, during the term, they will limit their recommendations to the sectors they cover.  This not only teaches the students to analyze specific stocks, but also the respect for the industry around them.  “Without this restriction, I expect most students would be attracted to high profile tech companies,” says Kaczorowski, “but in the real world we don’t always get to choose our coverage spaces.”

“When it comes to learning how to invest, there is no substitute for managing real money.”
Professor Dave Kaczorowski, CFA

Presentation Skills Needed in Finance

Whether you’re a hedge fund analyst reporting to a portfolio manager, or a capital markets analyst talking to a client, the ability to convince others of your view is crucial to the investment profession. In the upcoming class, students will have to stand in front of their peers and present their recommendations, and face the scrutiny of their experienced instructors in real time.

“What works for presenters in these situations is knowing your stuff, and stating very clearly and concisely your position. Presenters who give long rambling answers, or don’t have an answer to every question, likely won’t convince others of their views. You can rehearse ahead of time, but in the real world, you will have no way of knowing the questions the clients will ask.  You just need to know as much about the topic as you can.”

If you want to learn more about the course or the MS in Finance program, you are welcome to email Dave Kaczorowski directly.

CFA® (Chartered Financial Analyst) is a registered trademark owned by CFA Institute.

Request information about GGU’s MS in Finance or MBA program >>

A Concise History of the Financial Planning Profession

by Dave Yeske, DBA, CFP®

Author’s note: I would like to acknowledge the invaluable feedback and guidance I received from Marv Tuttle and Brent Neiser, whose long history and leadership within the financial planning profession has given each of them a unique firsthand perspective.

Being a member of a profession means having a shared understanding of who we serve and how we serve them, as well as the standards to which we hold ourselves when practicing our craft. It should also include a shared understanding of our history; where we came from and how we evolved to look the way we do. Those first elements are well covered by academic programs and continuing professional education, but a shared sense of history fades unless periodically refreshed. It feels like the time for a refresh has arrived, and so I’m taking this opportunity to offer a concise history of the financial planning profession as I understand it.

One further note before proceeding: in the following pages I focus primarily on the institutions that gave rise to, or arose from, the emerging financial planning profession, rather than a history of the theory and practice of financial planning itself. That will perhaps be the focus of a future contribution.

Institutional Framework

If we’re talking about financial planning as a concept and a body of knowledge, you could do worse than choose an origin date of 1862, which saw the passage of the Morrill Act and the rise of land-grant universities, something I’ll say more about later. However, if we’re talking about the professional practice of financial planning as we generally know it today, there’s near universal agreement that our birth year was 1969. On December 12 of that year, Loren Dunton convened a meeting of 13 financial service industry leaders at a hotel near Chicago’s O’Hare airport to discuss the creation of a new profession. Out of that meeting came the Society for Financial Counseling, an umbrella organization for a membership association that would eventually be called the International Association for Financial Planning (IAFP), and an educational arm that would eventually be named the College for Financial Planning. In 1971, the College created a five-course curriculum leading to the CFP® designation, graduating its first class in 1973. That first graduating class, in turn, formed the Institute of Certified Financial Planners (ICFP) as something of an alumni association. With the creation of these three entities — IAFP, ICFP, and the College — the institutional foundation had been laid for most of the major developments that followed.

From the standpoint of membership associations, we can round out our picture of the early landscape by noting the formation a decade later of the National Association of Personal Financial Advisors (NAPFA) in 1983. NAPFA’s mission and purpose was, from the beginning, to support and promote the delivery of fee-only financial planning advice. While always the smallest among financial planning groups by membership, NAPFA has nonetheless managed to wield an outsized influence in the public realm.

To better support and grow the young profession’s body of knowledge, in late 1978 the ICFP founded a new journal, the Journal of the Institute of Certified Financial Planners, publishing the first issue in 1979. The Journal grew and evolved, eventually becoming the Journal of Financial Planning that you now hold in your hands. From the beginning, the Journal’s goal was to present a mix of peer-reviewed articles and topical columns that were aimed at the needs and interests of a practitioner audience. The Journal archives contain a rich history of academic and practitioner contributions that chart the evolution of our body of knowledge over the intervening years. The entirety of that nearly 40-year history of financial planning theory and practice is available in the archives found on the Journal’s website (FPAJournal.org) and should be any practitioner’s first stop when researching questions related to advising clients or running a practice.

The IAFP and ICFP pursued divergent paths during the late 1970s and through the 1980s, with the ICFP focusing solely on the interests of CFP® professionals and the promotion of the CFP® marks with the public, the media, regulators, and legislators; and the IAFP focusing more broadly on all of the players in the financial services industry who might have an interest in financial planning or financial planners. The IAFP also focused more on the process of financial planning and was “designation neutral” with respect to the qualifications a practicing financial planner should hold. While many CFP® professionals belonged to both organizations, an attitude of competition emerged that would persist until the eventual merger of the two organizations in the year 2000, something I’ll discuss in more detail later.

Meanwhile, the other major institutional player that had arisen from that fateful meeting in Chicago, the College for Financial Planning, continued to grow the number of CFP® professionals, surpassing 10,000 by the mid-1980s. In 1980, the College sued Adelphi University for granting CFP® marks to graduates of its financial planning certificate program. Although the College held a service mark and trademark on the CFP® and Certified Financial Planner marks, respectively, the outcome of the trial was considered far from certain. Facing the possibility of a loss that would throw the integrity of the marks into question, the College’s then-president, Bill Anthes, decided to negotiate an out-of-court settlement that had wide-reaching implications for the marks and the profession.

“In the late 1990s, CFP Board worked to promote the CFP® standard worldwide by sublicensing the right to use the marks to standard-setting bodies in other countries. This process eventually led to the creation of the Financial Planning Standards Board (FPSB) in 2004 and the transfer of the rights to the Certified Financial Planner and CFP® marks outside the U.S. to this new standard-setter. FPSB now has 26 member organizations around the world that certify more than 161,000 individuals as CFP® professionals.”

Anthes proposed the creation of an independent standard-setting body that would take control of the marks, giving rise to the International Board of Standards and Practices for Certified Financial Planners (IBCFP), later renamed Certified Financial Planner Board of Standards or, more commonly, CFP Board. In July 1985, as a consequence of negotiations between the College, the IBCFP, and the ICFP, the new standard-setter came into existence and assumed control of the marks. The ICFP was a signatory to these creation documents as a consequence of the rights it had previously been granted to use CFP® and Certified Financial Planner in the association’s name. Dan Parks, J.D., CFP®, then-president of ICFP, negotiated on behalf of the Institute while attending the group’s 1985 retreat on the University of California, Santa Cruz campus. Parks was assisted by ICFP’s then-chair, P. Kemp Fain Jr. (It’s worth noting that the highest honor bestowed by FPA, the P. Kemp Fain Jr. Award, is named for this pioneering leader who later served as chair of the IBCFP’s board of governors). Fain is notable for his white paper, “One Profession, One Designation,” in which he made a powerful case for building the financial planning profession around a single mark of competence and ethics — the CFP® mark.

In addition to transferring ownership of the CFP® and Certified Financial Planner marks, the College invested $2.5 million to fund the creation and initial operations of the IBCFP. This visionary move by Anthes laid the foundation for the global CFP® standard we know today. For this and many other contributions to the profession, Bill Anthes was honored with the P. Kemp Fain Jr. Award in 2002.

The creation of the IBCFP had a galvanizing effect on the College, resulting in the creation of a new umbrella entity, the National Endowment for Financial Education (NEFE) that held the College, a newly accredited master’s program, and a series of “institutes” devoted to financial research. In 1997, NEFE sold the College for Financial Planning to the Apollo Group and became a non-profit foundation dedicated to educating consumers about personal finance, especially those whose needs are not being met by others. NEFE is still active today and notable, among many other initiatives, for its high school financial planning program, which can be co-taught by classroom teachers and practicing financial planners.

Meanwhile, starting in the late 1990s, CFP Board worked to promote the CFP® standard worldwide by sublicensing the right to use the marks to standard-setting bodies in other countries. This process eventually led to the creation of the Financial Planning Standards Board (FPSB) in 2004 and the transfer of the rights to the Certified Financial Planner and CFP® marks outside the U.S. to this new standard-setter. FPSB now has 26 member organizations around the world that certify more than 161,000 individuals as CFP® professionals.

Financial Planning Education

As mentioned previously, one can trace financial planning education to 1862 and the passage of the Land-Grant College Act of 1862, or Morrill Act. Land-grant universities were intended to foster advances in agriculture and industrial arts in order to bolster the economic vitality of the nation. One of the departments that developed in the late 19th century was home economics, first aimed at providing instruction in the economic management of the farm household, but later expanded to include the economic management of any private household. From the earliest days, the field encompassed a wide range of social and technical topics, including nutrition and food science, personal finance, family household management, and consumer behavior. Home economics is now more generally known as “family and consumer science,” or less frequently, “human ecology.” Many university financial planning programs today that are registered with CFP Board arose from this source, shifting their focus in the 1980s toward educating professional advisers rather than “home economists.”

The first undergraduate financial planning degree program aimed at educating professional advisers, a bachelor’s degree in financial and estate planning, was created by Robert Bohn at Brigham Young University. This was followed in 1980 by graduate programs at Golden Gate University (Master’s Degree in Financial Planning) and San Diego State University (master’s degree in financial services). Throughout the 1980s, more programs arose in business schools and family and consumer sciences departments, and by 1987, the IBCFP could report that 20 universities across 14 states had registered their programs with the IBCFP.

On the membership side, Bob Bohn, by then at Golden Gate University, San Diego State’s Tom Warschauer, and Baylor University’s Tom Potts in 1984 founded the Academy of Financial Services (AFS) as a membership association serving the needs of academics teaching in financial planning programs. It’s worth noting that Tom Warschauer, the Journal’s first academic editor, is one-half of the namesake for the Journal’s annual Montgomery-Warschauer award for original research in financial planning, while Tom Potts served both as chair of CFP Board and national president of FPA. AFS later launched a professional journal, Financial Services Review, as a destination for academic research on financial planning and financial planning education. Through an ongoing partnership between FPA and AFS, digital editions of Financial Services Review are available free to FPA members.

Pro Bono Financial Planning, the Hallmark of a True Profession

Before going any further, one more important institutional player within the financial planning profession must be mentioned. In 1995, the IAFP reactivated a long-dormant non-profit entity and christened it the Foundation for Financial Planning. While the Foundation began with a broad mission related to financial planning and personal finance, its mandate has evolved and it is now focused exclusively on supporting the delivery of pro bono financial planning services to those in need.

As a consequence of commitments by both large financial services firms and individual practitioners, the Foundation’s endowment has today grown to $20 million. To date, the Foundation has made grants totaling nearly $6 million supporting pro bono initiatives ranging from help for the families of veterans to Financial Planning Days, where the public can receive free financial planning advice. And although the Foundation is independent of FPA, an innovative partnership has resulted in the Foundation managing the pro bono activities of FPA’s 91 chapters, nearly all of which have ongoing initiatives to mobilize member energy toward helping those in need. A commitment to giving back through pro bono service is surely the hallmark of any true profession, and the Foundation is an essential player in mobilizing, managing, and financing the pro bono efforts of those caring practitioners who give their time and energy toward this noble cause.

Merger, Focus, and Cooperation

In 1997, the IAFP board of directors made what would prove to be a momentous decision when they officially dropped “designation neutrality” and adopted the official position that those who hold themselves out as financial planners should be CFP® professionals. That fall, Peggy Ruhlin, then-president of IAFP, met with the ICFP board of directors, described the IAFP’s new position, and suggested the two organizations explore the possibility of a merger, something that had been unsuccessfully attempted a decade earlier. A working group was formed and, in an echo of those fateful meetings in 1969 that originally gave rise to the two organizations, a series of meetings began at Chicago’s O’Hare Hilton. As a result, the two organizations decided that a merger to “unify the voice, focus, and resources of the financial planning community, bringing together those who champion the financial planning process” made sense. A subsequent vote by the ICFP membership endorsed this decision, and on January 1, 2000, ICFP and IAFP became FPA.

This was a critical, if never inevitable, development for the profession — one that combined two organizations possessing unique strengths and perspectives. The IAFP had always been focused on the financial planning process and its power to transform lives for the better. But that power is only fully realized when financial planning is practiced by competent, ethical advisers. This is where the ICFP’s long and exclusive focus on supporting and promoting the CFP® standard and the professionals who embrace it came into play. With that dual focus, FPA emerged with the primary aim of being “the community that fosters the value of financial planning, and advances the practice and profession of financial planning,” with the further objective to “advance awareness of the characteristics of professional financial planners and support the standards of the CFP® certification in order to serve the public.”

“The Foundation for Financial Planning’s endowment has today grown to $20 million. To date, the Foundation has made grants totaling nearly $6 million supporting pro bono initiatives ranging from help for the families of veterans to Financial Planning Days, where the public can receive free financial planning advice.”

FPA at that time housed a broker-dealer division, originally part of the IAFP, which was comprised of firms that supported independent registered representatives, many of whom were (and still are) members of FPA. In early 2003, members of the broker-dealer division, finding themselves overwhelmed by emerging changes in the regulatory landscape, asked FPA to take up advocacy efforts on their behalf in Washington, D.C. Until this time, FPA’s advocacy initiatives had been directed exclusively toward issues related to the financial planning profession in general and CFP® professionals in particular. Taking up the request at its board retreat, the board affirmed that FPA existed to be “the community that fosters the value of financial planning and advances the financial planning profession,” which implied an exclusive focus on the financial planning profession and the needs of CFP® professionals. To divide FPA’s focus, it was felt, would undermine the message and the mission. The board, however, also felt that it would be inconsistent with its commitment to the core values of integrity and relationships to keep the broker-dealer division within FPA if it could not meet the urgent needs of its B-D members, nor would it be congruent with those values to merely dissolve the division and set its members adrift. And so, FPA facilitated the formation of the Financial Services Institute (FSI), devoting financial resources to its creation and initial operations.

A few years later, on December 9, 2008, the three major players in the field of financial planning, FPA, CFP Board, and NAPFA, came together to form the Financial Planning Coalition. The Coalition’s mission is to individually and collectively support policy initiatives to ensure that financial planners are held to a fiduciary standard and regulated to the standard of competence and ethics represented by the CFP® marks. As of this writing, the Coalition’s most recent focus has been directed toward supporting the Department of Labor’s final fiduciary rule and encouraging the SEC to promulgate a fiduciary standard for broker-dealers.

Among emerging initiatives, meanwhile, CFP Board’s newly created Center for Financial Planning aims to be an umbrella organization for programs related to the career pipeline and diversity, and as a home for academics teaching in financial planning programs. The Center also plans to launch an academic journal devoted to research in financial planning.

Which brings us to the present.

Help Write the Next Chapter

Financial planning pioneer Ben Coombs once observed that our profession, if you thought of it as a painting, still had a lot of white space left, even after nearly half a century of development, leaving ample room for future generations to make their mark. In that spirit, it is my hope that those of you reading this short history will help to write the profession’s next chapter. How? By leaning in and engaging with your professional community.

Attend a chapter meeting, go to a conference, speak at a conference, form a study group. Better still, volunteer with your FPA local chapter or join a national workgroup, whether sponsored by FPA, NAPFA, AFS, or CFP Board. Research a question of interest and submit your paper to the Journal or to Financial Services Review. Teach a class, take a class, be a guest lecturer, mentor a student. And if you’re already doing any or all of the above, keep it up and encourage others to join you.

All of these and similar commitments are what mold and advance this amazing profession of financial planning. I look forward to seeing your name, dear reader, in some future iteration of this concise history.

This article appeared in the Journal of Financial Planning, a publication of the Financial Planning Associationin September of 2016.

About Dave Yeske

Dave Yeske, DBA, CFP®, is managing director at Yeske Buie, past chair of FPA, and practitioner editor of the Journal of Financial Planning. He earned a bachelor’s degree in applied economics and a master’s degree in economics at the University of San Francisco, and a DBA at Golden Gate University, where he holds an appointment as Director of GGU’s Financial Planning programs and Distinguished Adjunct Professor.

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Adding Behavioral Coaching to a Financial Planning Career

By Derek Elrod, Certified Financial Planner™ (CFP), MBA, MS
Derek Elrod has been the President of RB Capital Management, LLC and now Partner at Bridgewealth Advisory Group, LLC.

It seems like the longer someone has been an advisor and the busier their days become, the more likely they will get into a routine of jumping straight into recommendations while only scratching the surface on client goals. I said scratching the surface on purpose. Having been in the business for 14 years, I can say that most of us are not diving deep to find out what truly motivates that client. The Master’s in Financial Planning and Taxation program at Golden Gate University has given me the skills to gain a greater knowledge of my clients. It is surprising what you can learn when you step back and listen more. Financial planning is not just about giving broad investment and financial planning recommendations, but also about finding out what really interests your clients, what their deep-rooted goals are in life, and what gives them motivation and happiness.

My fellow students and I, who ranged in experience from one year to over twenty-five, learned a number of techniques in the Coaching Skills for Financial Planners class taught by Saundra Davis. It was a very big class for me, but I can give one simple example. If you say to a client “tell me more” instead of “why,” the tone is much more positive and you are more likely to get a revealing answer from the client versus a defensive response.

Once you find out your clients’ life motivations, they will have a much higher probability of meeting their savings goals, spending goals, and stick to their long-term plans.

Putting Behavioral Finance Knowledge to the Test

Cases in Financial Planning taught by Dr. Dave Yeske, CFP™ and Professor Elissa Buie, CFP™ was one course in the MS in Financial Planning degree I completed in 2018. Whether or not you are a CFP™ practitioner, this is an absolutely fantastic course and project. We watched planners interviewing fake clients – a couple – about all facets of their lives including estate planning, retirement planning, insurance planning, college planning, and investment management. I liked that the “fake clients” were not an easy case.

“If you want to set yourself apart from the crowd, look into the CFP® program, graduate degree programs in Financial Planning such as the one offered by GGU, and try to learn from knowledgeable and ethical employers like Dr. Dave Yeske, CFP™, the Chair of GGU’s Financial Planning programs.”

Quite a few Behavioral Finance issues came up! The professors purposely made the clients difficult in terms of agreeing on their goals, dreams, planned retirement dates, and spending habits. It made for a great case and forced us to come up with creative solutions for both the husband and wife to be happy while meeting their main priorities. It made us really think before giving recommendations that would try to meet the goals of both individuals.

The education was hands-on which was part of why I chose GGU. We developed and presented a comprehensive financial plan in Professors Buie and Yeske’s and it was a great experience. I recently started my own RIA (Registered Investment Advisor) firm and really look forward at implementing what I learned into my own practice.

I wish I could send a new employee just to take this one course! They even taught us how to properly take notes in a client data gathering meeting.

I cannot say enough about Dr. Yeske. He is a pioneer in our industry and continues to shape the direction it is going. We need more like him! His knowledge, experience, and philosophies are a fantastic resource to his clients, to GGU, and to the financial planning industry.

Financial Planning Education & Building a Career

I got into financial planning as a complete coincidence. I was working on our family farm after graduating with a business degree and got a call from a firm that wanted to tap into my agriculture network. I accepted the position with no intention of staying in the industry, but I soon realized how great the profession was and how much I was enjoying it.

Most undergraduate business majors don’t even have financial planning careers on their radar. That is unfortunate. I would tell them that financial planning is a fantastic career choice that allows one to utilize all of their business and personal talents on a daily basis. A lot of people, including myself, do an MBA after completion of their undergraduate degrees. I would highly recommend someone interested in financial planning look at graduate degrees specializing in the field to prepare them for the industry and the CFP™ designation.

“I cannot say enough about Dr. Yeske. He is a pioneer in our industry and continues to shape the direction it is going. We need more like him!”

Unfortunately, clients are not knocking down our doors to give us their money to invest and ask for financial planning advice, so starting out building clients on your own is very difficult. Often the best option is to work for an existing firm and mentor that will help you learn, hone your skills, and not force you to start your book of business from scratch. If you are looking at building your own client base, then you have to network. My niche market is in the agricultural industry where not only does my family have deep roots, but also where I continue to network, market, and belong to organizations in those communities and circles.

One complaint I have about our industry is that it is way too easy to call yourself a financial advisor. An individual may just have an insurance license or a securities license such as the 6, 7, 65, 66, etc. I passed the Series 7 at 21 years old with about a week of studying and the Series 66 a few weeks later without studying. Making it that easy to become an “advisor” does not help give our industry the prestige and respect it deserves. That is why I am a huge supporter of the Certified Financial Planner (CFP™) program, the CFP® exam, and what the CFP® marks stand for. I wish that it was required to be a CFP™ certificant to call yourself a financial advisor or a financial planner. Maybe one day!

If you want to set yourself apart from the crowd, look into the CFP® program, graduate degree programs in Financial Planning such as the ones offered by GGU, and try to learn from knowledgeable and ethical employers like Dave Yeske, the Chair of the Financial Planning programs at GGU.

We asked Derek why he chose GGU

In 2016, eight years after an MBA, and ten years after the CFP™ designation I came back to study at GGU as a working professional. Most CFP™ professionals like me do not have in-depth knowledge about taxation, and this program helped fill in some of those gaps. I had no local universities that offered anything similar to this program, but because of GGU I was able to do the degree online living in Fresno even though the campus is in downtown San Francisco. The online courses forced us to have weekly discussions with both the professors and our peers. The program could be accomplished in a shorter period, but it took me 2 ½ years due to my personal and current workloads outside of school.

[Pictured above, header: Derek Elrod and Analise, his wife, on the family almond farm in central California.]
About Derek Elrod

Derek Elrod is a Certified Financial PlannerTM (CFP) who has been President of RB Capital Management, LLC and now Partner at Bridgewealth Advisory Group, LLC. He is President of the Financial Planning Association of Central California and appears on KMPH Fox 26 as host of the “Dollars & Sense” segment. Elrod holds a BS from Santa Clara University, MBA from California State University Fresno, and a Master’s in Financial Planning and Taxation from Golden Gate University.

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Project Management Graduate Students Win GGU & American Society for Quality® Scholarships For Research Papers

Yoko and Anna Project Management Degree San Franciscoedited

(left to right): Anna Noel, John Sourial, ASQ® San Francisco Secretary, and Ms. Hui-ling (Yoko) Ling

Each year, a few GGU student award-winners have the opportunity to present their research on quality and process improvement to industry professionals belonging to ASQ (The American Society for Quality) and earn tuition scholarships in the process. This opportunity is thanks to the sponsorship of GGU Quality Management Professor Shinmei  Kiyohara.

Anna Noel (MS, Project Management candidate) described how a Six Sigma approach to Quality Management was successfully applied to improve nursing-staff performance in a Dallas, TX area hospital. The Define, Measure, Analyze, Improve, and Control (DMAIC) approach was also used and successfully addressed upper management’s goals for the 600-bed facility. As a result, a key medical procedure was reduced from 43 to 30 minutes, an adjustment to the shift-change procedure resulted in adequate staffing — and nurses enjoyed that they did not have to walk as far during their shifts.

Hui-ling (Yoko) Ling’s (MS, Project Management candidate) winning paper, “Improving Production with DMAIC Case Analysis,” describes a company with long-standing delivery-time issues. In her presentation, Ling outlined a case study about the company’s long throughput time (TPT) and the Six Sigma DMAIC methodology used to improve the TPT process.

“I’m proud of these students’ accomplishments.” Says Marie Spark, MBA, PMP®, Project Management Program Director & Lecturer.” To me, Golden Gate University is all about providing our students with hands-on experience and the chance to share knowledge with industry professionals. “

Applying Six Sigma & DMAIC to Healthcare Procedures
A list of papers and reports from Anna Noel, a scholarship winner.

“PMP” is a registered mark of Project Management
Institute, Inc.

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Bringing Global Experience to the CFA® Program Exam Prep: Q&A with Vincent Deluard, CFA®

Vincent Deluard, Chartered Financial Analyst® (CFA) is the Global Macro Strategist at INTL FCStone Financial Inc. and teaches several CFA® Program exam prep classes: Ethics & Professional Standards (Level I & Level III) and Private Wealth Management (Level III).

How would you sum up your career, in brief?

I write weekly reports discussing global macroeconomic topics, such as monetary policy, exchange rates, and capital market forecasts. I also do frequent roadshows and conferences to advise pension funds and other institutional investors on various investment strategies. Last, I present my research findings in the financial media and various industry publications.

You appear on TV and have contributed to Forbes, the Financial Times, and the Wall Street Journal. Your concept of “DUMB beta” seems to have gained a lot of traction lately. Can you explain what it means, and how it relates to the CFA® Program curriculum?

Sure. “Smart Beta” is currently a big buzz word in the ETF industry. The CFA® Program curriculum shows that it is an oxymoron: investors either pursue active returns with research (the “smart” part), or they simply try to capture the broad market premium (the “beta” part). As a joke, I illustrated the emptiness of the promise of “Smart Beta” providers by creating a “basket of deplorables,” buying only the stocks that are ignored by the “smart beta” indices. So far, my “DUMB” basket has outperformed an equal-weighted portfolio of the major “Smart Beta” ETFs.

I think the lesson for CFA® candidates is that the CFA® Program provides the analytical and quantitative tools to see through marketing claims. In our industry, many are more interested in generating commissions and fees than in generating long-term returns for investors. The rigor of CFA® Program curriculum helps in achieving the latter.

Why do you teach CFA® Program exam prep classes?

I was a student in this program ten years ago. I do not think I would have passed if it had not been for the outstanding quality of the classes, the energy of the professors, and the support of my study groups. I moved to work on Wall Street for a few years after I passed Level III, but I reached out to CFA Society San Francisco immediately after I moved back to San Francisco: I wanted to give back to a program that had given me so much. I have now taught CFA® Program exam prep classes [register here] for four years, and I have enjoyed every minute of it.

…the CFA® Program provides the analytical and quantitative tools to see through marketing claims. 

It sounds like study groups helped you. What worked for you in passing all the exams?

Groups are very important. The CFA® Program exams are very difficult, with a lot of material to assimilate. It can be overwhelming at times, so it is important to have a good support network. Study groups help with motivation. As a bonus, many of my old study group peers are good friends today!

Also, I cannot stress enough the importance of doing as many practice tests, as early as possible. The format of the exams can be quite unsettling at first, especially for non-native speakers such as me. You need not only to know the material, but also to understand what the CFA Institute expects on exam day.

Will you be teaching in the fall after exam prep classes have started to be taught at Golden Gate University?

Yes, I will teach Ethics & Professional Standards (Level I and Level III) and Private Wealth Management (Level III). It is excellent that Golden Gate University is involved. The teaching candidates get from accomplished people from around the Bay Area, from various universities and companies, is more than just test-focused. Giving students a broader view will help them be better investors, and that is what the CFA® exam should be about.

How do you bring your international experience to the CFA® Program curriculum?

I travel in Latin America and Europe every other month to present my global macro outlook. Incorporating the global picture is a lot more important today than it was in the 70s and 80s. I try to incorporate this global perspective in the classes I teach: students need to understand the perspective of a Singapore-based investor, or the specific challenges of working in an emerging economy, because their careers may well take them there.

I believe the CFA Institute has gone a long way down this road. Its initial focus was how to value domestically-listed securities, in the spirit of Graham and Dodd. These tools are still crucial today: they are the building blocks of securities analysis. But you need to complement them with a global perspective, factoring macro forces such as exchange rates, monetary policy, and international capital flows.

The fact that there are now more CFA® candidates in Asia than in North America illustrates how the CFA® program has changed. Also, a Canadian client once told me that the city with the highest number of candidates per capita is Toronto, not New York.

“Incorporating the global picture is a lot more important today than it was in the 70s and 80s. I try to incorporate this global perspective in the classes I teach: students need to understand the perspective of a Singapore-based investor, or the specific challenges of working in an emerging economy, because their careers may well take them there.”

Please tell us about the ethics classes you teach.

Ethics and professional standards have become more and important across the entire financial industry. After the great financial crisis of 2008, the industry has become much more regulated, and that is a good thing.

Finance cannot thrive if everyone just thinks about short-term profits: when we consider an action, we must ask ourselves first whether it is right. The investment profession has a huge challenge ahead of itself: for right and wrong reasons, the industry suffers from a trust deficit – only politicians are less trusted in public surveys!

With its tireless promotion of ethical decision-making, codes & standards, and industry guidelines, the CFA Institute is on the front line of this battle. There could not be a better time to get the CFA® designation.

CFA® Program exam prep weeknight classes start on Tuesday, September 18th and Saturday classes begin on September 22nd at Golden Gate University [map] . You can register now on the CFA Society San Francisco website.

CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.

Prusela Phillips Appointed Director of Alumni Relations and Annual Giving at Golden Gate University

We are pleased to welcome Golden Gate University’s Director of Alumni Relations and Annual Giving, Prusela Phillips, to our community! She will be cultivating relationships between the University and our alumni, and implementing the goals outlined in the GGU Strategic Plan which includes launching the Ambassadors Council, the Alumni Referral Grants, and recruitment for the new mentorship program for our undergraduates.

Prusela earned a B.S. from the University of California, Merced while holding a three-year internship at its Office of Alumni Relations. As her alma mater was and still is a growing campus, her position offered an opportunity to build an alumni relations program from the ground up.

Prusela Phillips

Most recently, as the alumni relations manager for the San Mateo County Community College District, she was successful in building a strong alumni network, and engaging alumni donors to establish named scholarships and endowments across its three colleges.

Prusela will work closely with the members of the GGU Alumni Association and its leaders to mobilize the alumni network to advance the university’s mission and goals – by empowering alumni to use their networks to increase student enrollment, connect the university with potential adjunct faculty, and influence the career development of our students.

To be sure you’re receiving the most recent alumni news, be sure to update your contact information on the Alumni Directory at alumni.ggu.edu.

Contact Prusela directly by email  or by phone at 415-442-7832.

Special Event: Collaboration with Chinese Tax Educators & Researchers

Professors from the Bruce F. Braden School of Taxation and School of Accounting recently hosted professors/practitioners and researchers from Southwestern University of Finance and Economics (SWUFE) in China. The visitors also included Prof. Yang Yang (above, far right), a Visiting Scholar from Guizhou University of Finance and Economics. Prof. Yang is conducting research on U.S. Taxation here at Golden Gate University and helped organize the meeting with SWUFE. The event explored how teacher exchange programs might facilitate sharing of knowledge and best practices in teaching the complexity of U.S. Tax Laws to Chinese students.

Dean Fred Sroka introduced the guests to the U.S. Tax system and how it is different from the system used in China. He also discussed how U.S. Tax Laws are taught at the Braden School.

Fred Sroka, Dean of the Bruce F. Braden School of Taxation and School of Accounting

Qinrui Du, Postgraduate Education Officer at SWUFE, gave a presentation on the many tax and accounting programs at SWUFE. Adjunct Professor of Taxation Michael Dong also joined the meeting, along with Xiaoxi Ma, LLM Tax student at GGU School of Law, who assisted with translating from English to Mandarin.

Qinrui Du, Postgraduate Education Officer (SWUFE)

A discussion followed about ways the Braden School can foster a collaborative relationship with the Chinese educators moving forward. Visitors from SWUFE invited our faculty to teach or present at SWUFE during the summer of 2019.

Dean Sroka commented: “The recent changes to U.S. tax laws give us a unique opportunity to study the impact on cross-border business and investment. We hope our faculty and students will benefit from the opportunity to work with their peers from SWUFE.”

Visiting Delegation from SWUFE
Jiaming He, Deputy Dean, School of Public Finance and Taxation
Yinpin Yin, Professor
Maoqing Fei, Associate Professor
Huiying Zhang, Associate Professor
Min Lv, Associate Professor
Qinrui Du, Postgraduate Education Officer


From a Cold-Calling Exercise to a Job: An Exercise in Persistence and Courage

By Jing Xin
Candidate, MS Integrated Marketing Communications, ’18

& Public Relations Coordinator, Cross Marketing PR

I really suck at this. Or, at least that was what I thought after a Sales Management class exercise where we had to cold-call businesses and start asking questions. Our professor for the class, Don Surath, wanted us to get the name of the answerer’s boss – and find out if they liked their job. At the end of the 20 minutes, some people get a lot of information, and I felt jealous. I literally did the worst of anyone in the class.

When I heard that another assignment was to get an “ultimate decision maker” to consent to an interview, I thought: I am going to withdraw from this class. However, it became the highlight of my experience at GGU. With persistence and a little courage, I went from the worst to one of the best in the class. I was eventually able to achieve something that was completely outside my comfort zone but requires sales techniques that are essential for any business professional. And I got my first marketing job.

We learn hands-on at GGU.

We are all afraid of talking to people. So, in another exercise, Don had us walk around downtown and ask businesses to see if they had a Yellow Pages phone directory. As I went from Verizon Wireless to Mikado Sushi, feeling like I was being watched by people as if was somewhat mentally troubled, I realized how this course was exposing my vulnerabilities: the difficulty of starting a conversation, fear of judgment and rejection, and the inability to control situations. But by pushing and trying, and applying the real-world techniques Don gave us, I had a route to getting to be one of the best cold callers.

Claudia Ross, CEO, Cross Marketing Public Relations

I was new to marketing and was working in a bio research lab when I got to the Sales Management Class. At the time, I was having discussions with my advisor (and Marketing Chair) Blodwen Tarter, and she suggested that I reach out to companies for informational interviews. At about the same time, Don handed us the Ultimate Decision Makers assignment. I tried to connect this task with what I needed most to prepare myself for a career in marketing. Then I came up with an idea: Why not conduct a series of informational interviews so that I can help myself and my classmates at GGU get to know some marketing and PR agencies in San Francisco?

I met peers in class who worked in ad agencies or sales who shared how they talk to people. These are great moments…

I started to cold call these companies and ask for their CEOs, precisely following Professor Surath’s instructions and saying, simply, “I wonder if you could help me,” and waiting for them to say yes. Eventually, I had one receptionist interested in what I intended to do. From her, I got the cellphone number of Claudia Ross, the CEO of Cross Marketing PR.

She picked up her cell the second time, but to meet Claudia in person was not easy. Her schedule was changing every minute, and, we had to cancel and postpone the interview twice. Then I proposed the “check-with-Claudia-every-morning” approach. Luckily, Claudia agreed. The day of the interview was rough as well. Something unavoidable (really, it turned out) had come up. I offered to “stick around” the reception area for a few hours, and finally was able to meet Claudia.

Each of the steps that led me to the interview was very difficult, among hardest was the fear of uncertainty. With instructions from Professor Surath and his book Conquering Cold Calling Fear, the process of following up for the interview has made me realize how important it is to be confident and persistent.

…by pushing and trying, and applying the real-world techniques Don gave us, I had a route to getting to be one of the best cold callers.

I applied for a position at Cross Marketing PR soon after my Decision Maker interview with Claudia, and she immediately hired me. Now I now handle a wide range of tasks at the agency – from media relations to social media and content management. Compared to my former career in scientific research, which was rather solitary, my new job in marketing and public relations requires the interaction and understanding of people that I enjoy very much.

The Ultimate Decision Maker experience has also shown me that as long as we are willing to reach out to the most successful business people; connecting with them and learning directly from them is easier than you might think.

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