4 min read August 2023 — Todd Brockwell, president of 1900 Wealth Management, a subsidiary of Jefferson Bank, talked to Invest: about how their alternative investment platform benefits their high-net-worth clients. He also underlined how being a local wealth management company gives 1900 Wealth an edge over competitors when it comes to customer experience and how the company’s focus on treasuries mitigates risk amidst stock and bond market uncertainties.
What are the most important overall contributions of 1900 Wealth to the San Antonio community?
By offering customized wealth management services, we are able to retain investments within San Antonio, preventing outflow to larger competing markets such as San Francisco, Dallas, or New York City, where many high net worth individuals allocate their funds. Our exceptional and personalized client experience, and the relationships our customers have with our advisors and team, are what allow us to keep those funds here at a local community bank and in our own investment platform.
What are the most important opportunities for the wealth management market in San Antonio?
Unlike many of the larger wealth management firms in San Antonio, which are not locally owned and have their headquarters elsewhere, 1900 Wealth is headquartered here allowing us to make all decisions locally. This gives us the ability to promptly make client-focused decisions that benefit our customers.
What is 1900 Wealth’s strategy when it comes to navigating an economic environment with high inflation, labor challenges and high interest rates?
In 2022, all asset classes had negative impacts, and inflation took a toll on the value of the dollar. We are now seeing favorable returns in the asset classes of the traditional marketable securities that we like. This encouraging trend brings a sense of optimism to both the wealth management community and the residents of San Antonio and South Texas.
One of the cornerstones of 1900 Wealth is the long-term perspective we use when building portfolios. When financial advisers engage in market timing, there is a high chance that they will not get it right and the experience will not be tax-efficient for clients. 1900 Wealth does not try to guess what markets will do when they whip around after tough years like 2022 or 2020. Instead, we focus on strategically positioning portfolios without having to bounce around while paying attention to tax efficiency. In other words, we refrain from making short-term market entries or exits based on speculative guesses, rather we prioritize our commitment to achieving long-term results.
How will 1900 Wealth’s new office in Austin help the company expand in the financial services market?
Over the past five years, we have diligently established strong relationships with several families in Austin and central Texas, enabling us to build a strong portfolio. There is a lot of new generational wealth being created in Austin that needs direction, which is why we are excited about the growth opportunities in this market. Put simply, we want to service our clients better by being in close proximity and do what is best for them in the long term. Our top priority right now is to get the new Austin operation set up and running smoothly. We recently signed a lease in the downtown area, and we are actively looking for new talented individuals to join our team.
How has the concept of financial freedom evolved among the high-net-worth clients of 1900 Wealth?
All high-net-worth families have interesting stories about how they created their wealth, but each person has their own meaning for financial freedom. The definition of financial freedom is not the same for a person who belongs to fourth- or fifth-generation wealth than for someone who built a business from scratch and sold it. For some people financial freedom is all about having enough money to retire, on the other hand, we also have clients whose idea of financial freedom is giving all of it to charity upon their death. At the end of the day, our goal is to ensure our clients obtain their individual sense of freedom and fulfillment-whatever that might be.
How would you describe investor confidence right now?
There is a lot of talk in the media about recession, leading to apprehension among individuals who are not comfortable with the investment market. Despite economists being more optimistic than in recent years and talks of a soft landing, the lingering effects of the COVID pandemic and a complicated political environment both locally and globally, there is not much confidence in the stock and bond markets.
At 1900 Wealth, we added sizable new assets into Treasury securities backed by the federal government because of the fear in the stock and bond markets. There is still confidence in the federal government given the amount of dollars that have gone to U.S. Treasuries, but people are leery because of the 40% drop in the stock market that we saw in 2020 and the 15 to 20% drop in the equity markets that we saw in 2022. Nevertheless, some people might see the current situation as a buying opportunity and significant flows are going into the stock market in 2023.
What are some of the legislative matters that 1900 Wealth monitors that could potentially impact your business operations or clients?
1900 Wealth is registered with the SEC, and fortunately, we have not seen any significant regulatory changes that impact us. Apart from potential local private investment opportunities on our alternative investment platform, the local government has also not impaired us. Nevertheless, one thing that we keep a close eye on is interest rate movements. These rate fluctuations influence our decision-making when it comes to building portfolios and can also impact consumer confidence and investor confidence.
What products or services of 1900 Wealth’s product portfolio are more in demand?
We’ve seen high demand in the U.S. Treasury securities over the past 12 to 18 months. Traditional markets, such as stocks and bonds produced negative returns in 2022 prompting a large amount of interest in our alternative platform which consists of real estate, private equity, venture capital and direct lending. We have seen a lot of growth there defined as committed dollars.
What is the most important challenge that 1900 Wealth is facing?
I would like to see San Antonio in a position that draws more young professionals to our city. We want to attract more qualified talent to the platform of 1900 Wealth. The most important thing that the next generation of financial planners and portfolio managers must keep in mind is that they must always do what is in their client’s best interest. You work hard to build your clients’ or investors’ confidence and trust, and you can never compromise it.
How does 1900 Wealth differentiate itself from its competitors in the financial planning and wealth management market in San Antonio?
There are many investment advisers and brokers in San Antonio, so at 1900 Wealth, we aim to differentiate ourselves from the rest by setting up the best client experience possible and offering an alternative investment platform that includes local investments. We also partner with several firms in San Antonio to do direct investments with them. While these investments are not in the large national or global bank platforms, we believe that our investments in the local economy will be successful. We have also assembled a team of several advisors who have family office backgrounds, which gives us an edge over our competitors. As I mentioned previously, we are locally owned, and we take pride in being neighbors to our clients. Fostering personal and high-touch client relationships is what sets us apart from the rest.
For more information, visit:
