“For at least the last five years, my investments have lost money or been stagnant—even before the economic downturn,” says McMullen of his thrift savings plan, Roth IRA, and the mutual funds in his brokerage account.

He was so discouraged during the Great Recession of 2008–09 that for several months he stopped contributing to his brokerage account. “I watched it go as low as $14,000 at one point, when it had been worth $28,000,” he says. “I wanted to pull out all my money to protect it from a complete loss.”

But McMullen, who spent several years in the Armed Forces, is not one for backing away from challenges. He knows discipline gets results, and socks away $400 a month into his Roth IRA and about 10% of his salary of approximately $75,000 into the retirement plan at work.

He’s counting on these investments to fund his dream of being able to retire by age 55. His other goals include having the financial wherewithal to travel abroad once a year, and save for the college education of his 1-year-old son.

McMullen, a lieutenant in the United States Navy, serves as a naval science instructor for the University of South Carolina’s Naval ROTC unit. Although he offers guidance to students, McMullen admits that he also needs direction, “so that I can improve the performance of my investments and get the kind of growth I’m looking for.”

For the most part, his finances are on track. He has $37,000 in a money market account (which also represents his emergency funds), $5,300 in checking, additional savings of $3,000, and $92,000 invested in equities. He’s not drowning in debt—his only obligations are $2,300 for furniture, his car loan of $23,000, and $111,000 for his two mortgages.

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McMullen concedes, however, that his expenditures could be better organized: “I don’t track daily, small expenses very well. I put most everything on my American Express, so I can see where I spent my money. But with so many purchases, when I get my statement it’s overwhelming. I haven’t updated my budget in awhile.” Some of his larger bills are set up on automatic bill pay to eliminate guesswork.

Motivated by his son, McMullen is looking to fine-tune his approach to saving and investing. “I want to be able to start saving for his education, not just college, but maybe during his formative years. I want to be able to handle whatever life throws at me financially.”

The Advice
Black Enterprise and Robert Rowell, financial adviser and vice president of investments for Wells Fargo Advisors L.L.C. in Charlotte, North Carolina, devised a plan to help McMullen get the most out of his  investments and reach his financial goals.

• Diversify portfolio: McMullen’s track record calls for a closer look at his holdings. “He has all his Roth IRA contributions in large-cap stocks. He has all his eggs in one asset class and is missing out on other asset classes, such as [midcap], small-cap stocks, real estate securities, emerging markets, commodities, high-yield bonds, international stocks, investment grade bonds, etc. Rowell recommends putting 65% in equities or stocks; 32% in bonds or fixed income; 2% in commodities; and 1% in cash alternatives. “From one year to the next, one class can have a higher rate of return, and you don’t want to miss the growth opportunities,” explains Rowell. He also recommends that McMullen max out his thrift saving plan contributions and make sure he has a broad brush of assets, including bonds and international investments.

• Reinvest dividends: McMullen was so disappointed with the lack of growth in his brokerage account that he started receiving dividends. Rowell advises that he reinvest them. “When they are paid in a down market, you are more likely to invest at cheaper prices,” says Rowell

• Build savings for son’s education: Rowell suggests two options: a 529 plan or the Uniform Gift to Minors Act. With a 529 savings plan, your investment grows tax-deferred and withdrawals are tax-free, as long as the money is used for college-related expenses. The UGMA allows money or other assets to be given as a gift to a minor child while you maintain control of it. The money doesn’t have to be used only for college, Rowell says.

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“Jeremy seemed to like this because the money could be used for many purposes. He should explore the trade-offs of both,” says Rowell, who recommends McMullen talk with a tax professional to help him make a choice. Rowell suggests using the $2,000 contest winnings to seed the college fund and then saving $100 a month systematically. If he starts with $2,000 and adds $100 a month, assuming a 6% average rate of return annually, he would have nearly $40,000 in 17 years.

• Protect and prepare for the future: While McMullen has a $400,000 life insurance policy through the Navy, he’s vulnerable. “He should consider an additional, outside policy. He recommends that McMullen consider an $800,000, 30-year policy, which would cost $80 a month. “He’s young, healthy; a term policy would be inexpensive and help take care of his son’s needs,” says Rowell. “He has a 1-year-old son and no will. If something happens to Jeremy, the state will determine what happens to his son. He needs to speak with an attorney and get his will and trust done.”

Rowell also suggests McMullen consider buying a long-term care policy now obtain disability insurance through his employer.

• Tighten budget: There are several online tools offered by Wells Fargo or websites such as Mint.com that will help keep him on track to meet his financial goals. Rowell recommends McMullen find a good financial adviser and meet at least once a year for an annual checkup to determine adjustments to his finances.

–By Karen Thomas

Since hindsight is 20/20, we can look back at predictions to check how reliable they have been. In his 1998 book Roaring 2000s, best-selling financial author Harry S. Dent Jr. wrote: “We should see a Dow of at least 21,500 and as high as 35,000, as the baby boomers and recent wave of immigrants move into their peak spending years around 2009.” Years ago the inimitable financial television host Jim Cramer wrote: “Housing bubble? What housing bubble? The signs are in place for a further run-up in real estate.”

Then a half-decade later—with the housing bubble rapidly deflating—Federal Reserve Chairman Ben Bernanke announced: “I don’t anticipate any serious problems . . . among the large internationally active banks that make up a very substantial part of our banking system.” Ouch! The point is not to pick on Dent, Cramer, and Bernanke, but rather to note that even smart, well-informed people doing their best can be off the mark since the future is far less predictable than we would like. To steer clear of potentially problematic advice, I have a few rules of thumb.

When looking for information about the road ahead, try to uncover the “how,” not the “what.” In other words, rather than latch on to a specific market call, figure out what data supports the thesis. For instance, how will U.S. stocks fare going forward? I don’t have one number. Rather, I think a two-pronged approach will help uncover the likely direction: What is the long-term return of the asset class, and what do recent returns suggest? Over the past 85 years, stocks have gained, on average, 10% annually. While stocks have gained 9% annually for the past quarter century, the last decade has produced poor performance: stocks have averaged only 3%. Many simply assume that the pain will continue, but reversion to the mean—which holds that after periods of extremity markets tend to go back toward trend—says the opposite. The market is more likely to see double-digit returns over the next decade or so rather than single-digit growth or especially a negative return.

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Another mental tool that can be very helpful is considering the potentially negative repercussions of being wrong.  For instance, houses cost less than they have in recent history—likely close to a bottom—and borrowing burdens are lower than they have  been for decades.  So, I would argue it is a good time to buy a house if you can afford a 20% payment, and expect to stay in  the home for five years or more.  Even if prices do keep falling, there is no damage so long as you stay in the house and keep current on mortgage payments.

Finally, the long term trumps the short term, especially when financial assets are volatile. If you have read a magazine or watched television in the last couple of years, you know gold prices have shot to the moon. Specifically, over the last three years, gold has increased at a remarkable 29% per year. Many are suggesting you should hop on the bullion express. But wait: Over the past 25 years, the annual return for gold is just 6%, well below the 9% return on stocks for the same timeframe. And the price of gold can just sit there for very long periods without moving upward (which, coincidentally, is what gold itself does—it just sits there). Indeed, from March 1987 to May 2005 the return on gold was 0%.

These are just examples; they’re not meant to serve as the three key recommendations for the year. Rather they are meant to show how low-key, rational, well-informed thinking can help guide you on your path to financial independence. Ultimately the time-tested truisms of finance should serve as starting points no matter what year it is: spend less than you make; maximize your tax-advantaged investments over the long term; stay away from fads; and lean moderately against conventional wisdom rather than following the crowd. If you’re able to do these simple things, chances are you’ll create wealth more dependably than those who just listen to number-tossing experts at the beginning of the year.

Meanwhile a number of factors have pushed REITs upward: Through Nov. 30, 2011, the S&P Retail REIT Index was up 8.7%, compared to 0.8% for the S&P 500. What is most important is yield, especially when bond payouts remain low. By law, REITs have to pay out 90% of their profits to investors. McMillan reports REITs yielded 3.6% at the end of November 2011, compared to 2.1% for the S&P 500.

Consumer finance companies have seen signs of improvement, too. S&P looks for personal consumption to rise 2.3% in 2011 and 2.2% in 2012. What’s more, says McMillan, finance companies have taken steps to protect themselves by increasing loss provisions. The expectation is that charge-offs will drop as well in 2011 and 2012, even with persistent unemployment. Put it all together, and it makes sense that an S&P index of consumer finance companies rose 11.9% from Jan. 1 to Nov. 30 in 2011.

1 SIMON PROPERTY GROUP INC. (SPG) is one of the largest shopping center operators in the U.S. The company owns large malls and outlet centers in or near major markets such as New York, Miami, Atlanta, Houston, and Los Angeles. We think the company will see revenues increase 7.4% in 2011, and another 4.3% in 2012. Mall construction rates have fallen and that keeps supply in check relative to demand from retailers, which in turn pushes rents higher. Simon owns high-quality properties and the REIT’s geographic diversification shields it from weakness in any one regional market. The stock yields 2.8% and we expect Simon’s dividend to be raised. We hold a 12-month price target of $142 for Simon shares.
PRICE AT REC.: $122.97  •  P/E: 41.13

2 CBL & ASSOCIATES Properties Inc.  (CBL) is a REIT that mostly owns malls and shopping centers in the Southeast and Midwest. The company has done well targeting middle-market areas such as St. Louis. We see 2011 revenues climbing 2.4% as occupancy rates remain healthy, as they’ve remained above 90% in 2011. CBL has also seen robust rent increases—8.2% during the past third quarter. The same catalysts behind Simon’s solid results are at work here. CBL’s yield is a sizeable 5.6%. Our 12-month target for the stock is $22 a share.
PRICE AT REC.: $14.73  •  P/E: 61.38

3 AMERICAN EXPRESS CO.(AXP) should report revenue gains this past year and 2012 as well. We anticipate a 9% rise in 2011 and 12% this year. AmEx’s U.S. and overseas card divisions are driving increases and we were encouraged by the company’s international business in the 2011 third quarter—even amid concerns over Europe’s sovereign debt problems. Write-offs in the U.S. card division have fallen to 2.9% in the 2011 third quarter from 5.7% a year before, a sign that credit issues are abating. We currently hold a $58 price target on AmEx shares.
PRICE AT REC.: $48.78  •  P/E: 12.23

Morningstar analyst Daniel Holland says there may be a long-term investment opportunity in the confusion created by such contradictory information. For one, despite the signs of an economic slowdown in Europe and the U.S., many industrials are still reporting strong order growth. A second positive sign: stock buybacks and merger activity in the sector, which have both been on the upswing. “There are definitely indications that when it comes to the best run industrials, current worries are more headlines than fundamental concerns,” says Holland.

It’s clear that the best managed companies in the group took away some important lessons from the 2008 recession. Many have pared down debt and streamlined operations. Industrials also have a trump card to the effects of the European economic troubles by having some of their business in emerging markets where infrastructure spending is helping to boost revenues. “China and Brazil are particularly compelling stories right now,” says Holland. Finally, stock market volatility has brought down some share prices of the best stocks in the group to bargain levels.

“We look for companies with a wide moat, or in other words, barriers, to keep competitors from encroaching on their markets,” says Holland. “That can include expertise, service, or technology. The bottom line is that in a cyclical industry like this, moats make it possible to maintain operating margins and, in turn, profits.” Holland talked to black enterprise about three of his industrial picks.

—James A. Anderson

1 GENERAL ELECTRIC CO. (GE) It’s a company that ranks as one of our best ideas right now. The stock trades at about 11 times our current-year earnings estimate, which is quite cheap compared with other industrial companies and the historical price-to-earnings ratio that GE has carried in the past. The company is placing more focus on equipment for power generation, which positions it well for emerging market growth. Management currently aims for the GE energy business to grow earnings by more than 10% a year. GE Capital, the company’s finance arm, has bounced back from concerns that clouded its outlook during the 2008 economic crisis. We think GE can reach a fair value of $25 a share.
PRICE AT REC.: $16.48  •  P/E: 12.58

2 PARKER HANNIFIN CORP. (PH) is a maker of engineering and manufacturing equipment—motion and control components as they are called. They include automation and flight control systems, hydraulics, filtration systems, and engines, which are used by companies from McDonald’s to Caterpillar. Parker Hannifin is managed well and has a reputation for engineering expertise. Since the 2008 financial crisis, it has focused on controlling costs and expanding operating margins above 10%. The company also trimmed its debt from roughly 30% of capital on average to a current 20%. It has put 60 years’ worth of effort into setting up a global distribution network. We think fair value for the stock is $97.
PRICE AT REC.: $83.74  •  P/E: 12.39

3 UNITED TECHNOLOGIES CORP. (UTX) United Technologies Corp. has a focus in aerospace and construction. You probably know some of its higher-profile products: Otis elevators, Carrier air conditioners, Sikorsky helicopters, or Pratt & Whitney engines. Like other peers, United Technologies has emphasized cost cutting. Management expects to extract $350 million to $400 million of annual cost reductions. We think the company can attain compound annual earnings growth of 10.9% over the next five years and reach a fair value of $94. One tailwind is its 20% exposure to emerging market growth; another is its recent acquisition of Goodrich Corp., a leading supplier of services and systems to the aerospace and defense industry.
PRICE AT REC.: $78.87  •  P/E: 14.80

Q: “Should I start a 401(k) or 403(b) investment plan at 63 years of age?”

A: Yes! Actually, I think it can be a good idea to start a 401(k) plan at any point during your working years. You may know that a 401(k) or 403(b) is an employer sponsored retirement savings plan. But you may not know the full range of benefits associated with these plans.

For starters, you get three primary advantages with saving for your Golden Years using a 401(k). The first advantage is that you can set aside retirement funds on a pre‑tax basis; this lowers your annual tax bill. The second benefit is you get the potential for get capital appreciation when you invest your 401(k) funds in investments such as individual stocks or mutual funds. Finally, a third benefit of a 401(k) is that you may receive matching funds from your employer – which helps turbocharge your savings.

A 401(k) also gives you a more disciplined approach to investing for retirement, because you’ll be consistently contributing to your retirement assets – every pay period – regardless of what the market is doing. Such consistency also helps takes emotion out of the investing equation – making you less likely to be driven by fear or greed when the stock market swoons or surges.

Even if you wind up retiring in a few short years—say, at the age of 65 or 70, it’s still worth it for you to put aside more money into that nest egg and help to build your savings cushion.

That way, when you do leave the work place, you are not simply dependent upon your own savings that you might have had, which may be limited. You also won’t be solely dependent upon government funds such as Social Security.

Currently, the average Social Security recipient is only receiving roughly $1,000 per month. That’s not a lot of money to live off of.

If you’re 63, you’re probably at a higher level of earnings power, so you have the option to go ahead and put aside more money.

And here’s a bonus for you: The IRS recently announced that starting in 2012, the maximum amount you can sock away in a 401(k) plan is being raised to $17,000 for those under 50 and to $22,500 for those 50 and older. That’s a $500 increase over 2011 levels. (That $22,500 figure includes the “catch up” contributions that individuals 50 and older are permitted to contribute to a 401(k), as a way to help Americans who may have started saving for retirement later in life).

So let’s assume you did sock away at least $17,000 a year for five years. Well, that’s $85,000. If you saved $22,500 a year for five years, you’d amass $112,500, not assuming any increases (or losses) to your savings.

Hopefully, though, the funds you put aside for your retirement will grow and collect interest. Also, as I mentioned, you may even get some form of an employer match as well. It might not be dollar for dollar, but even if it’s $0.50 cents on the dollar or $0.25 cents for every dollar that you put in, that’s an additional kicker that you can look forward to.

All of this means you have many great reasons, even past age 60, to save in a 401(k) or 403(b) plan—and I would encourage you to do just that.

“Ask The Money Coach” is a syndicated column written by personal finance expert Lynnette Khalfani-Cox, co-founder of the free financial advice blog, AskTheMoneyCoach.com. Follow Lynnette on Twitter at @themoneycoach.

(Image: ThinkStock)

Investors will continue to face off-the-charts volatility. Many reeled from yesterday’s market activity as global markets plunged in response to the alarming European debt crisis.  The performance of all three major indices was their worst in the past few months. The S&P 500 index suffered one of its biggest drop since August, sliding 3.7 % to 1,229. The Dow Jones Industrial Average dipped 389 points—its worst one-day loss since Sept. 22—to 11,781.  And the tech-driven Nasdaq composite index fell 3.9% to 2,622. The decline erased gains etched out after a two-day winning streak.

The culprit: news that the crisis spread to Italy, Europe’s third largest economy. For the first time since joining the 17-nation Euro currency zone, the interest rate that Italy must pay to borrow money rose more than 7% for 10-year bonds, putting into question the country’s viability as it goes through a major transition in political leadership and proposed austerity measures.

Worries over Greek debt have increased volatility in the financial markets for the past year and that country’s bailout has been a long, arduous process. At $2.6 trillion, Italy’s debt is much larger than than that of Greece and two other troubled European countries that had to be rescued—Portugal and Ireland. The challenge: Unlike those smaller economies, Italy is viewed as too big for the same type of international bailout but too big to default. Analysts and government leaders agree that international intervention is imperative.

But on Thursday morning, the markets staged a comeback. The yields on Italian 10-year bonds dropped to 6.93% helped by secondary-market purchases by the European Central Bank—an action that steadied European markets. And U.S. stocks regained momentum after Standard & Poor’s maintained France’s AAA credit rating. By mid-day, the Dow was up 118 points, the S&P 500 rose 6.58 points, with energy stocks as top performers and tech lagging among its 10 major sectors, while the Nasdaq Composite fell 2.71 points.

Expect more market turbulence as the European scenario—and other major economic and financial events play out.

Europe represents more than 25% of the world economy. The financial crisis continuing to spread to other parts of the continent would be disastrous since its our largest trading partner and, in turn, such activity would affect business and employment on our shores.

Analysts from Moody’s Investors Service, one of the leading ratings agencies, recently announced it was concerned that the U.S. economy could be hurt if this catastrophe. The situation, they assert, would be similar to the aftermath of the 2008 bankruptcy of Lehman Brothers in which banks suddenly became less willing to lend to each other, creating a credit crunch for companies and individuals.

Don’t expect an American bailout as we grapple with our own sluggish economy. For example, President Obama has not commented on recent developments since he appeared at the G20 Summit in Cannes, France last week, urging European leaders to take “bolder action” to avert contagion. And when asked about Europe’s woes during the GOP debate last night, Republican presidential candidates were emphatically against any direct aid to stem the crisis. Mitt Romney‘s comment mirrored the sentiment of others: “Europe is able to take care of their own problems. We do not need to step in to bail out banks in Europe or here in the U.S. that may have Italian debt.”

In such a tumultuous environment, what should you do as an investor? I suggest you continue to follow the advice we offered in the Money section of our October issue. the strategies include:

• Adopt a long-term focus. By doing so, you can actually afford to not pay too much attention to market turbulence. Our experts tell investors not to panic and avoid making knee-jerk decisions you will regret when the market settles down.
• Stick with market leaders. Look for quality stocks with proven earnings track records and strong cash positions.  Some money managers maintain that multinational companies with revenue streams from different geographic locations will still offer downside protection.
• Look for value. Now is a great time to buy solid companies at bargain prices to gain some rather attractive returns—especially in battered industries like financial services.
• Purchase dividend-paying stocks. There are a number of companies that still manage to significantly grow earnings, generate free cash flow and offer strong dividend yields right now.

These are but a few approaches to bolstering your investments. Remember: Monitor, don’t ignore, the financial markets and make adjustments to your portfolio. Avoid your own investment crisis but not letting volatility force you to make a hasty exit from the market.

However, there has been some upside for African Americans on Wall Street these past five years. Those who remained with the global giants of the industry have demonstrated their expertise by leading them back to profitability. For some of the boutique firms that comprise the BE 100s financial services companies, their lack of exposure to toxic mortgage-backed securities that contributed to the financial crisis enabled them to bolster their operations by hiring talent from Wall Street giants and entering lines of business cast off by their larger counterparts.

Case in point: James Reynolds, CEO of Loop Capital Markets L.L.C. (No. 1 in taxable securities with $29.03 billion in lead issues and No. 2 in tax-exempt securities with $2.83 billion in lead issues on the BE Investment Banks list) hired nearly 25 people who had been downsized from bond departments at several large financial institutions, such as Bank of America and Goldman Sachs, that exited those lines of business. This same staff helped Loop Capital service a broader pool of bond buyers; their expertise was critical to the firm’s landing a significant piece of business—a structured underwriting of nearly $1 billion in general obligation refunding bonds for New York City.

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Another such entrepreneur, Christopher Williams, CEO of Williams Capital Group L.P. (No. 4 in taxable securities with $1.6 billion in lead issues on the BE Investment Banks list), turned acquisitive. The firm acquired the institutional assets of Nutmeg Securities L.L.C., a Westport, Connecticut-based broker dealer, as well as part of Utendahl Capital Partners, a former BE 100s firm.

Now these players continue to find new, inventive ways to win and profit in a challenging environment marked by a European debt crisis, the downgrading of the U.S. credit rating, a sluggish economy, and unpredictable markets. Due to the sweeping changes within this often volatile industry that remains a critical part of the U.S. economy, Black Enterprise decided to take another look at the African Americans at the forefront, highlighting those who continue to make deals that will shape the course of the world.

The editors of Black Enterprise spent the past several months developing this roster of “The 75 Most Powerful Blacks on Wall Street.” In conducting the research, our team pored over reams of industry data; consulted with leading trade organizations including the National Association of Securities Professionals, the National Association of Investment Cos., and the Executive Leadership Council; and interviewed scores of leading executives and entrepreneurs in the financial services sector. The men and women on our list met the following criteria:

• Those chosen are investment bankers, traders, asset managers, venture capitalists, private equity financiers, or top executives at financial services firms and have management responsibilities over these areas.

• They have achieved the status of chief executive, president, partner, chief investment officer, managing director, or other top-ranking positions at their firms, and have significant management duties.

• They demonstrate significant influence within their company and throughout the financial services industry.

• Entrepreneurs who own their own firms must operate investment banks that have managed more than $10 billion in total issues; asset management firms with at least $2 billion under management; private equity firms with at least $90 million in capital under management; or perform at a leading firm that engages in unique or complex transactions.

• Candidates must work for a U.S.-based company and have at least 10 years of experience in the financial services industry.

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Bernard Beal
CEO
M.R. Beal & Co.

Considered as the nation’s oldest, continuously operating minority-owned investment bank, M.R. Beal & Co. (No. 5 in taxable securities with $1.6 billion in lead issues and No. 3 in tax-exempt securities with $2.2 billion in lead issues on the BE Investment Banks list) was engaged in $40.2 billion of public financing in 2008, followed by $45.4 billion in bond issuances in 2009. In 2010, Beal led the company to senior-managed and co-lead deals totaling some $62 billion.

Ronald E. Blaylock
Founder & Managing Partner
GenNx360
Capital Partners

Blaylock serves on the transaction and analytical team for GenNx360 (No. 4 on the BE Private Equity Firms list with $600 million in capital under management) which invests in middle-market industrial and business-to-business companies. GenNx360’s Fund I portfolio has $600 million in committed capital from leading institutional investors. The firm’s portfolio companies represent more than $1 billion in revenues. Prior to launching GenNx360, Blaylock was CEO of Blaylock & Co., an investment banking firm he founded in 1993.

Cedric L. Bobo
Principal
The Carlyle Group

Bobo focuses on U.S. buyout opportunities in the industrial and transportation sectors. In his position at Carlyle, Bobo co-led Carlyle’s acquisition of AlpInvest Partners, a $43 billion private equity fund-of-funds manager based in the Netherlands. This strategic purchase ushered Carlyle into a new line of business. Also, in 2010, Bobo co-led the formation of a joint venture that will work to acquire more than $5 billion in shipping assets using up to $900 million in equity over the next five years.

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D. Steve Boland
Managing Director, Head of GWIM Mortgage Solutions
Bank of America Merrill Lynch

Boland is responsible for loan origination, underwriting, fulfillment, and service through partnerships with GWIM lines of business and provides strategic direction and leadership for the company’s standard mortgage business, representing some $40 billion in outstanding balances and $10 billion in annual loan originations. Boland increased fundings in the first quarter of 2011 by more than $1.88 million compared to the first quarter of 2010.

Francisco L. Borges
Chairman & Managing Partner
Landmark Partners

Landmark is a global leader in private equity and real estate limited partnership acquisitions in the secondary market, and Borges, a former Connecticut state treasurer, has been with the company for 12 years. Prior to joining Landmark, Borges was managing director of Financial Guaranty Insurance Co. He currently sits on several boards, including Assured Guaranty and Davis Selected Funds.

Napoleon Brandford III
Co-founder, Chairman & Partner
Siebert Brandford Shank & Co. L.L.C.

Brandford manages strategic planning of the company he co-founded in 1996 (No. 2 in taxable securities with $8.1 billion in lead issues and No. 1 in tax-exempt securities with $6.8 billion in lead issues on the BE Investment Banks list) and is involved in the day-to-day decisions of deal making. He is responsible for the firm’s overall strategic and marketing efforts and has led large-scale financing projects exceeding $5.9 billion over the past 10 years.

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Eddie C. Brown
Founder & President
Brown Capital
Management L.L.C.

As the head of Brown Capital Management L.L.C. (No. 10 on the BE Asset Managers list with $3.2 billion in assets under management), Brown oversees a portfolio that has grown 18% over the last five years. Espousing the GARP (growth at a reasonable price) philosophy, Brown, one of be’s “40 Most Powerful African Americans in Business,” has more than  40 years of investment experience.

Tina Byles Williams
CEO, Chief Investment Officer & Product
Manager, Global Equities
FIS Group

A 27-year veteran in the financial services industry, Byles Williams founded FIS Group in 1996. She is the portfolio manager for the firm’s global equities products and chairs the firm’s investment committee, overseeing all investment strategy, manager search, and disposition decisions. Prior to FIS, Byles Williams was a principal and senior consultant at WHP Inc., at the time the only full-service minority pension investment consulting firm.

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Edith W. Cooper
Partner, Managing Director & Global Head of Human Capital Management
Goldman Sachs
Age: 50

“The fact that Black Enterprise periodically highlights the number of senior professionals on Wall Street is really a sign that we do continue to make progress,” asserts Wall Street veteran Edith Cooper. Though she acknowledges that more still needs to be done, she says, “I think about the 25-plus years that I’ve been in the industry and I think, ‘Gosh, have we really made progress?’ And, quite frankly, I think, ‘Yes, we have.’”

As partner, managing director, and global head of human capital management at Goldman Sachs, Cooper is charged with the responsibility of  recruiting, developing, and retaining Goldman Sachs’ more than 33,000-member workforce. She also counsels those looking to follow in her path. “The term for that now is mentoring, coaching, guiding. I have so benefitted from mentoring over the course of my career, so I’ve always been very involved in mentoring others.”

A member of Goldman’s Management Committee, Cooper is involved in every major strategic and management issue for the $39.2 billion firm. She joined the company in 1996 to build and lead its energy sales group. In 2000, she became co-head of the commodity business in Europe and Asia, based in London, and in 2002 assumed responsibility for the firm’s futures business. “I’ve had the opportunity to contribute to Goldman Sachs through contributing to our clients’ success and to the development of my colleagues, and by giving back to the communities we operate in,” she reflects. “Am I done yet? Absolutely not.

There is so much more opportunity at the firm and in our industry, and so I think there is more to do.”

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T. Troy Dixon
Managing Director
Deutsche Bank Securities
Deutsche Bank

As head of Deutsche Bank’s Structured Products Trading Group, Dixon manages a multibillion-dollar balance sheet. His responsibilities include trading and risk management of adjustable rate mortgages, agency collateralized mortgage obligations, derivatives, reverse mortgages, and other mortgage-backed securities. Within Deutsche Bank he is a member of the Corporate Investment Bank Americas and Global Rates Executive Committees.

Amy Ellis-Simon
Head of Americas Corporate Access and Specialty Sales
Bank of America Merrill Lynch

From college intern to an analyst on the convertibles desk to managing director, Ellis-Simon has climbed up the ranks at Merrill Lynch in the past 17 years to become one of the most powerful professionals in her field. The first black woman to become a managing director in the firm’s investment banking division, she is also the co-founder of the Global Banking & Markets Women’s Leadership Council.

Alphonse “Buddy” Fletcher Jr.
Chairman & CEO
Fletcher Asset Management

Wall Street veteran Fletcher has completed more than 50 transactions funding dozens of promising companies through FAM, which has more than $500 million in assets under management. During the recent economic crisis, FAM structured and funded transactions for United Community Banks Inc., a community bank with more than $7 billion in assets, and Edelman Financial Group, a wealth management firm with roughly $18 billion in assets.

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Eugene Flood Jr.
Executive Vice President, Diversified Financial Services
TIAA-CREF
With more than 30 years of experience in asset management and finance, Flood became head of this newly formed division in May. His role includes oversight of the organization’s endowment, planned giving, and life insurance businesses. He was most recently president, CEO, and director at fixed-income manager Smith Breeden Associates.

Vicki L. Fuller
Managing Director
AllianceBernstein
Institutional Investments

Fuller is responsible for market and business development, product advocacy, and client service for state and local government clients totaling nearly $100 billion. She previously served as co-head of the Global High Yield Group at Alliance Capital and as a portfolio manager for high-yield, emerging markets and global high-yield portfolios for institutional and individual investors.

Stuart George
SVP, Head of Equity Trading
Delaware
Investments

George is responsible for managing all aspects of the firm’s equity trading desk and is a member of the company’s commission and soft-dollar committees. In addition to his duties as head trader, he also trades small and mid-growth stocks for the asset management firm that has more than $155 billion in assets under management. Prior to joining Delaware Investments in 1997, George was a senior equity trader at the State Teachers Retirement System of Ohio.

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Todd A. Gomez
SVP, Northeast Region Executive, Community Development Banking
Bank of America Merrill Lynch

Gomez is currently the interim national executive for the Community Development Banking division, responsible for providing a wide range of debt and equity financing solutions to developers of affordable housing across the country. Last year, the Community Development Banking division provided more than $1.6 billion in debt financing and more than $600 million in equity investments.

Gregg A. Gonsalves
Managing Director & Partner
Goldman Sachs & Co.

Gonsalves has inked more than 45 deals valued at more than $85 billion in total during his rise up Goldman Sachs’ mergers and acquisitions ladder. He is the partner responsible for Goldman’s Real Estate M&A Business, working with a variety of companies. Gonsalves advised Goldman Sachs affiliate Whitehall Street Real Estate Funds in its $1.2 billion acquisition of the Stratosphere Casino Hotel & Tower and 17 acres on the Las Vegas strip owned by American Casino & Entertainment Properties L.L.C.

David J. Grain
Founder & Managing Partner
Grain Management L.L.C.

Grain’s private equity firm, No. 12 on the be private equity firms list with $135 million in capital under management, invests in the telecommunications sector, primarily federal and state government wireless systems. Prior to forming Grain Management, he led an independent wireless communications tower company that is now Global Signal from bankruptcy to netting a $126 million IPO. In July, President Obama appointed Grain a member of the National Infrastructure Advisory Council.

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Stanley E. Grayson
Vice Chairman & COO
M.R. Beal & Co.

Grayson is responsible for the day-to-day operations at M.R. Beal & Co. (No. 5 in taxable securities with $1.6 billion in lead issues and No. 3 in tax-exempt securities with $2.2 billion in lead issues on the BE Investment Banks list). Prior to joining M. R. Beal, Grayson was the managing director and manager of the Public Finance Department of Prudential Securities Inc. and a member of the firm’s Operating Council.

Isaac H. Green
CEO
Piedmont Investment Advisors L.L.C.

Green launched Piedmont Investment Advisors L.L.C. (No. 8 on the BE Asset Managers list with $3.4 billion in assets under management) in 2000 with just three people and built the firm into an industry powerhouse. In 2009, Piedmont was among the firms selected by the U.S. Treasury Department to collectively manage a securities portfolio worth roughly $218 billion through the TARP (Troubled Asset Relief Program) Capital Purchase Program.

Calvin Grigsby
Founder
Grigsby & Associates Inc.

Grigsby founded one of the oldest black-owned, full-service investment banking firms in the country which is No. 5 in tax-exempt securities with $82.5 million in lead issues on the BE Investment Banks list. His firm has assisted local governments in raising more than $400 billion in tax-exempt capital and helped arrange $10 billion in public and private corporate offerings. In April, Grigsby became the sole manager of a $10 million government obligation bond in Illinois.

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Arthur H. Harper
Founder & Managing Partner
GenNx360 Capital Partners

Harper co-founded GenNx360 Capital Partners (No. 4 on the BE Private Equity Firms list with $600 million in capital under management) in 2006 and is responsible for the strategic direction of the firm, which focuses on industrial business-to-business companies in industries such as industrial water treatment, specialty chemicals, and engineered materials. Previously, Harper was an SVP at GE and president and CEO of GE Equipment Services—a $6.5 billion global business.

Carla Harris
Managing Director
Morgan Stanley Investment Management
Morgan Stanley

As head of the Emerging Manager Platform, Harris provides investment advice to corporations, public pension plans, foundations, and endowments. She was formerly a senior member of the equity syndicate desk, where she helped structure IPOs for UPS, Martha Stewart Living Omnimedia, Ariba, Redback, and the $3.2 billion common stock transaction for Immunex Corp., one of the largest such biotechnology deals in U.S. history.

Mellody Hobson
President
Ariel Investments L.L.C.

As president of Ariel Investments L.L.C. (No. 6 on the BE Asset Managers list with $5.5 billion in assets under management), Hobson oversees all operations outside of research and portfolio management. Additionally, she serves as chairman of the board of trustees for the mutual funds. She serves on the boards of DreamWorks Animation SKG Inc., The Estée Lauder Cos. Inc., Groupon Inc., and Starbucks Corp.

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Kenneth Holley
Chief Investment Officer &Principal
Herndon Capital
Management L.L.C.

Holley oversees all investment activities for Herndon Capital Management L.L.C. (No. 12 on the BE Asset Managers list with $2.5 billion in assets under management). He also serves as portfolio manager responsible for Herndon’s Large Cap Core International Equity product and one of the three portfolio managers responsible for managing its Large Cap US Core Equity product. Previously, Holley spent more than eight years at Morgan Stanley Asset Management.

Ronald Holt Jr.
President & CEO
Hansberger Global Investors Inc.

Holt oversees Hansberger’s $10 billion in assets under management and serves as the firm’s co-chief investment officer of the Value Team. In this capacity, he has ultimate responsibility for execution of the firm’s strategic, financial, and operational plans and policies. During the financial crisis, Holt and his team successfully created a new product offering, the Hansberger Multiple Investment Trust, a collective investment trust that specializes in Hansberger funds.

Alfred Jackson
Chairman & Managing Partner
Capital Point Partners

Jackson manages Capital Point Partners (No. 13 on the BE Private Equity firms list with $110 million in capital under management) and is responsible for deal flow generation, investor relations, capital raising, and overall strategy for the firm. Capital specializes in mezzanine financing, including buyouts and recapitalizations, between $5 million and $20 million to middle-market companies. As of June, Capital Point Partners II L.P. raised $28 million of a targeted $250 million private equity fund.

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Melissa E. James
Managing Director & Global Head of Loan Products
Morgan Stanley
Age: 47

“I didn’t necessarily intend to stay my entire professional career,” says Melissa E. James of Morgan Stanley. “In fact, back then, it was pretty grueling, especially when you start in the junior ranks. You’re working exceedingly long hours.”

James, who marks her 24th year at the global financial services firm, now oversees Morgan Stanley’s commercial lending business and its $70 billion in loan commitments—a business she helped establish. Over the years, James has held several positions, including running the industrial origination effort in Debt Capital Markets, where she helped raise billions in capital for corporate clients and worked on some of the firm’s most complex transactions. Those include the first domestic yen issuance for General Electric Capital Corp.; the first global bond for DuPont; and a complex debt-for-equity swap in connection with the $4 billion initial public offering for Agere, then the largest U.S. technology company IPO in history.

Those early years were critical in honing James’ business acumen and helped make her one of the most influential blacks in finance. “My career steadily became more fulfilling every year as I learned from my colleagues and was motivated by the firm’s culture,” says James, who has a bachelor’s from Yale and an M.B.A. from Harvard Business School. “I look back at my career opportunities and professional contributions and know that they have outweighed any sacrifices that were required.”

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Dennis A. Johnson
SVP & Chief Investment Officer
Comerica Asset Management Group
Comerica Bank

As chief investment officer of Comerica Asset Management Group, Johnson manages $26.5 billion in assets and is responsible for the firm’s passive and active investment strategies, alternative investments, new products, client relations, and business development. He is also co-chair of the Group’s Investment Policy Committee, which governs the company’s asset allocation policies for its investment professionals.

Edward E. Johnson Jr.
COO
Advent Capital Management L.L.C.

Johnson oversees all non-investment functions at Advent (No. 5 on the BE Asset Managers list with $5.8 billion in assets under management), including strategy marketing, product development, investor relations, and operations. This hedge fund management firm specializes in convertibles, equities, and high-yield securities. Prior to Advent, Johnson held various roles in financial services at Merrill Lynch and Salomon Brothers.

Robert L. Johnson
Founder & Chairman
RLJ Equity Partners L.L.C.

Johnson established this middle-market private equity firm, one of a portfolio of 14 companies that he owns, in 2006. The firm (No. 9 on the BE Private Equity firms list with $230 million in capital under management), invests between $15 million and $30 million per transaction. Johnson’s team originates, structures, and invests in traditional buyouts, recapitalizations, and growth capital infusions. He launched a new company, RLJ Fixed Income L.L.C., in June.

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David R. Jones
Co-Founder, President & CEO
CastleOak Securities L.P.
Age: 47

Sustaining an investment banking firm that had been launched not long before the financial crisis hit might sound like a recipe for disaster, but the young company’s timing actually helped it attract talented professionals who’d been downsized from the large institutions. And Castle-Oak Securities L.P.’s CEO David R. Jones continues to expand his company’s reach. “A lot of folks call smaller organizations like ours an eat-what-you-kill environment,” says Jones, who previously was head of Investment Banking and Capital Markets at Blaylock & Co. Inc. “People are attracted to that because if they’re bringing in business, they know how much it is and they know how much they’re going to get paid.

“We’ve grown tremendously because of the talented folks who have been available for us to hire,” says Jones, who now employs a staff of 55. “And the assets on Wall Street are its people.” Now with offices in New York; Chicago; Indianapolis; Atlanta; Cleveland; Columbus, Ohio; and Portland, Oregon, the 6-year-old firm (No. 3 in taxable securities with $3.6 billion in lead issues on the BE Investment Banks list) boasts significant underwriting deals. Among them was serving as co-manager on the Wells Fargo common stock issuance to raise more than $12 billion as part of its TARP, or Troubled Asset Relief Program, repayment plan authorized by the U.S. Treasury. Others include equity recapitalizations by GE ($12.1 billion) and Ford ($1.4 billion); and co-managing the re-IPO  of AIG ($8.9 billion), the IPO of Primerica ($320 million), and underwriting in General Motors’ IPO ($18.1 billion).

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Derek Jones
Managing Director, Asset Management Division
Credit Suisse

Jones is a partner in the Customized Fund Investment Group within Credit Suisse Private Equity. He sits on CFIG’s Investment Committee, responsible for helping shape the company’s investment philosophy and strategies. He also serves as co-head of the group’s co-investment practice. Jones has built a successful career in private equity since joining the firm in 2007, having also been a founding partner at former be 100s company Provender Capital.

Terry L. Jones
Managing Partner
Syncom Venture Partners

Jones has participated in more than 125 investments during his tenure with Syncom Venture Partners (No. 7 on the be private equity firms list with $410 million in capital under management) and its affiliates. Among those investments were interests in BET, Radio One, and TV One. A hallmark deal for the firm was the acquisition of the Iridium Satellite system for $25 million that later sold for $436 million. In the deal, Syncom also retained an interest in Iridium’s successor after it went public.

Vernon E. Jordan Jr.
Senior Managing Director
Lazard Frères & Co. L.L.C.
Lazard Ltd.

An attorney and Washington powerbroker, Jordan sits on the board for Lazard Ltd., a financial advisory and asset management firm, operating in 42 cities across 27 countries with $161.6 billion in assets under management. Jordan also sits on the board of directors of Asbury Automotive Group and serves as senior adviser to the board of directors for American Express Co. and Xerox Corp.

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Will C. Jordan
SVP, U.S. Equity Trading
Trust Co. of the West

With more than 17 years of investment experience, Jordan trades securities in the $847.3 million TCW Relative Value Dividend Focused, $5 billion TCW Relative Value Large Cap, and $685.3 million TCW Value Opportunities strategies. He was named head equity trader for the $570 million TCW Value Opportunities mutual fund and institutional strategy and is also responsible for managing commission, soft-dollar, and directed budget targets for all relative strategies.

William M. Lewis Jr.
Co-Chairman of Investment Banking
Lazard Ltd.

Since joining Lazard in 2004, Lewis was involved in numerous multimillion- and billion-dollar deals. Among them was the $1.9 billion Maytag sale to Whirlpool and American Express’ $1.1 billion sale of American Express Bank. Prior to joining Lazard, Lewis was a managing director and co-head of the Global Banking Department at Morgan Stanley and was responsible for the firm’s global industry practices and regions.

Tracy V. Maitland
President & Chief Investment Officer
Advent Capital Management L.L.C.

Maitland has been an innovator among asset managers, successfully building his company through investments in convertible securities. His prowess has earned Advent the No. 5 rank on the BE Asset Managers list with $5.8 billion in assets under management. Founded 16 years ago, Advent specializes in convertible, high-yield, and equity strategies.

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Mark Mason
COO
Citi Holdings

Mason is responsible for all aspects of strategy, business restructuring, divestitures, and asset sales, and he has direct oversight responsibility for Citi Financial, Alternative Investments, Commercial Real Estate, and International Consumer Finance. He oversaw the restructuring of CitiFinancial into OneMain Financial and CitiFinancial Servicing Network. Under his leadership, Citi Holdings has reduced assets on the balance sheet by more than half a trillion dollars and divested several businesses and assets.

Raymond J. McGuire
Head of Global Banking
Citigroup Inc.

A dealmaker extraordinaire, McGuire was involved in several billion-dollar transactions, including the $45 billion spinoff of Time Warner Cable from its parent company; ConocoPhillips Co.’s $36 billion acquisition of Burlington Resources; Koch Industries’ $21 billion acquisition of Georgia-Pacific; the $13 billion sale of EDS to Hewlett-Packard; and the $68 billion sale of Wyeth to Pfizer. Prior to joining Citi, he was the Global Co-Head of Mergers & Acquisitions at Morgan Stanley.

Obie L. McKenzie
Managing Director, Global Client Group
BlackRock Inc.

McKenzie has nearly 40 years of experience in asset management, commercial and investment banking, trade finance, corporate treasury, and brokerage. He has served at BlackRock, one of the largest publicly traded investment management firms in the country with $3.7 trillion in assets under management, for more than six years. McKenzie ran his own firm, McKenzie & Co., in the mid 1980s and was a founding board member of the National Association of Securities Professionals.

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Philip McNeal
Managing Director, Senior Banker
J. P. Morgan
JPMorgan Chase & Co.

McNeal is responsible for delivering targeted investment, estate planning, fiduciary, and liquidity advice to JPMorgan’s individual investors. He joined JPMorgan in 1984 as an investment banker in the firm’s Natural Resources and Power Group. McNeal remained in that function until 1994, when he began managing the firm’s Syndicated Loan Origination business for technology, media, telecommunications, consumer retail, oil and gas, and power clients.

Bernard Mensah
Global Head of Emerging Markets – Sales and Trading
Bank of America Merrill Lynch

Operating from London, Mensah leads Bank of America Merrill Lynch’s emerging market sales and trading for equities and fixed income, currencies, and commodities, excluding Asia. A 17-year trading and investing veteran, Mensah joined the company last year from Goldman Sachs, where he served as global head of bank loans and distressed trading.

Rodney M. Miller Sr.
Managing Director of Mergers & Acquisitions Group
J.P. Morgan
JPMorgan Chase & Co.

With more than 20 years of experience in all aspects of financial advisory services, Miller has advised both domestic and international clients on a broad variety of assignments including mergers, acquisitions, divestitures, proxy contests, hostile transactions, and debt and equity capital raisings. He has been involved in major transactions such as the $25 billion split of Mosaic Co. from Cargill and the $6.5 billion acquisition of Danisco by DuPont.

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Laurence C. Morse
Co-Founder & Managing Partner
Fairview Capital Partners Inc.

Morse serves as a general partner of Fairview’s 17 funds-of-funds representing more than $3.2 billion in assets, making the company No. 1 on the BE Private Equity Firms list with $3.1 billion in capital under management. He’s participated in the investment of more than $2.5 billion in more than 100 traditional and specialized venture capital and private equity limited partnerships.

Valerie Mosley
Partner, SVP & Investment Strategist
Wellington Management Co. L.L.P.

Mosley is a partner, senior vice president, and investment strategist for Wellington, a $650 billion global money management firm. As a member of two of the firm’s fixed-income strategy groups, she helps set investment strategy and parameters for several of the firm’s fixed-income mandates.

Colbert Narcisse
COO for Investment Strategy & Client Solutions
Morgan Stanley Smith Barney L.L.C.

Narcisse helps oversee client solutions: alternative investments, mutual funds, exchange-traded funds, closed-end funds, insurance, annuities, managed account platforms, retirement services, and research. He also serves as interim head of the Corporate Equity Solutions Group, managing the firm’s global stock plan services and directed share plan operations, which serve approximately 2.5 million participants at more than 500 corporations globally.

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J.D. Nelson
Founder & Chairman
RhumbLine Advisers

Nelson founded this investment firm in 1990 and specializes in managing index-based strategies for institutional investors. His firm’s strategies include pure index tracking and customization to meet client needs. Prior to founding RhumbLine (No. 2 on the BE Asset Managers list with $23.7 billion is assets under management) Nelson was senior vice president and first director of the Public Funds Division at State Street Bank. Recently, RhumbLine started offering clients a new international equity product.

Adebayo O. Ogunlesi
Chairman & Managing Partner
Global Infrastructure Partners

Ogunlesi founded this $5.64 billion independent fund, a joint venture between Credit Suisse and General Electric that invests in energy, transportation, and waste sectors worldwide, in 2006. He was most recently executive vice chairman and chief client officer at Credit Suisse. In 2009, he led the firm in the acquisition of Gatwick Airport in London, a £1.51 billion ($2.39 billion) transaction.

Lisa Opoku
COO & Managing Director
Goldman Sachs, Asia Securities Division

Stationed in Hong Kong, Opoku works closely with the co-presidents of Goldman Sachs Securities Division (Asia) on business planning, financial analysis, personnel management, and business development for the $3.5 billion unit. She is instrumental in driving the unit’s focus, providing sales, trading, clearing, financing, and reporting services to institutional clients, including hedge funds, corporate pensions, and endowments. Opoku joined Goldman in 2004 and became a managing director in 2006.

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Derek Penn
Managing Director
Pershing L.L.C.
Bank of New York Mellon

Penn is head of equity sales and trading at Pershing, the clearing and trading arm of Bank of New York Mellon. He is responsible for sales and trading in products ranging from domestic stocks and options to international equities and foreign exchange. Penn also manages the trading areas that service the firm’s registered investment advisors clients. The firm’s NYSE and London trading operations are also under his direction.

JoAnn H. Price
Co-Founder & Managing Partner
Fairview Capital Partners Inc.

Price led the marketing strategy that established Fairview’s core group of institutional investors, which today includes foundations, endowments, and corporate and public pension funds. As such, she has helped Fairview grow to No. 1 on the BE Private Equity firms list with $3.1 billion in capital under management. Price and her partners have committed more than $2.5 billion in capital to more than 100 equity partnerships.

Eugene A. Profit
Founder & CEO
Profit Investment Management L.L.C.

From 1996 to 2010, Profit has grown the firm from $300,000 to more than $2 billion in assets under management, earning the No. 15 spot on the BE Asset Managers list. He oversees overall management of the firm’s operations and client portfolios. Profit’s well-known investment style is to find undervalued or mispriced growth stocks.  The flagship product, the Profit Large Cap Equity Composite, has performed competitively benchmarked to the Russell 1000 Growth Index.

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Michael Ray
Vice President & Head Equity Trader
Legg Mason Capital Management

Ray is responsible for all of Legg Mason Capital Management’s equity mutual funds and separate account products. He began his career in 1987 and three years later was promoted to a junior trader on Legg Mason’s institutional bond and equity trading desks. It was Ray’s money management prowess that put him in a position to manage Legg Mason Capital’s equity portfolio, which is worth about $17 billion today.

James Reynolds Jr.
CEO
Loop Capital Markets L.L.C.
Age: 57

While the financial markets were reeling, James Reynolds, CEO of Loop Capital Markets (No. 1 in taxable securities with $29.03 billion in lead issues and No. 2 in tax-exempt securities with $2.83 billion in lead issues on the BE Investment Banks list), says his firm was having one of its best years ever.

“We added a significant amount of personnel, and revenues held up very well,” he says. Reynolds, 57, says his firm took advantage of the market dislocation during the financial crisis since most of the subprime-fueled turmoil affected the large, global firms who had the scale to play the credit default swap game. “It enabled us to hire some really good people as the large firms retrenched or left the business and helped us grow in many of the businesses that we were in.”

The end result: Loop Capital beat out several global firms on a structured underwriting of $962.5 million of general obligation refunding bonds for New York City—the largest underwriting deal completed by a minority-led syndicate in the city’s history.

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J. Donald Rice Jr.
Founder & CEO
Rice Financial Products Co.

Under Rice’s stewardship, Rice Financial (No. 4 in tax-exempt securities with $568 million in lead issues on the BE Investment Banks list), has underwritten municipal bond transactions exceeding $245 billion and has executed derivative transactions totaling nearly $30 billion. In 2010, the firm served as a managing underwriter on more than $52 billion in municipal bond issues—a 578% increase in just four years.

John W. Rogers Jr.
Chairman & CEO
Ariel Investments L.L.C.

Rogers’ mantra of slow and steady winning the race has helped him establish Ariel Investments L.L.C. (No. 6 on the BE Asset Managers list with $5.5 billion in assets under management) as a financial services superpower. The former stockbroker for William Blair & Co. L.L.C., who has been named one of BE’s “40 Most Powerful African Americans in Business,” now serves on the boards of global corporate giants such as Exelon Corp. and McDonald’s Corp.

Suzanne F. Shank
President & CEO
Siebert Brandford Shank & Co.

Shank is responsible for the overall administration of the firm’s scope of services and for attaining the firm’s profitability goals, earning SBS the rank of No. 2 in taxable securities with $8.1 billion in lead issues and No. 1 in tax-exempt securities with $6.8 billion in lead issues on the BE Investment Banks list. In 2010, SBS served as joint  bookrunner for the State of California issuance of $3.27 billion of taxable and $1.25 billion of tax-exempt bonds.

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Maceo K. Sloan
Chairman, CEO & Chief Investment Officer
NCM Capital

Sloan oversees all business aspects of Durham, North Carolina-based NCM Capital (No. 11 on the BE Asset Managers list with $2.6 billion in assets under management). The firm launched its own mutual fund, the NCM MidCap Growth Fund, and invests client money in the bond markets. Sloan was elected chairman of the board of trustees for TIAA-CREF, a financial services firm with $453 billion in combined assets under management.

Gerald B. Smith
Chairman & CEO
Smith, Graham & Co. Investment Advisors L.P.

As CEO of Smith, Graham & Co. Investment Advisors L.P. (No. 7 on the BE Asset Managers list with $5.0 billion in assets under management), Smith oversees the firm’s fixed-income and equity institutional assets as well as $140 billion in assets for which his firm serves as adviser. In February 2009, under Smith’s leadership, the firm acquired the fixed-income, small-cap value and mid-cap value assets of Ark Asset Management Co. Inc., doubling total assets under management.

Robert F. Smith
Chairman & CEO
Vista Equity Partners L.L.C.

Smith’s 11-year-old firm currently manages equity capital commitments of approximately $5 billion, positioning Vista to become No. 2 on the BE Private Equity  Firms list with $2.7 billion in capital under management. He’s invested in firms such as Surgical Information Systems L.L.C., Accruent Inc., BigMachine, and SER Solutions Inc. Prior to Vista he executed and advised more than $50 billion in mergers and acquisitions as co-head of Enterprise Systems and Storage at Goldman Sachs.

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Gwendolyn Smith Iloani
Chairman, President & CEO
Smith Whiley & Co.

Smith Whiley & Co. (No. 8 on the BE Private Equity list with $300 million in capital under management) specializes in management buyouts, recapitalizations, acquisitions, and growth capital, and makes private equity and mezzanine investments. Smith Iloani directs Smith Whiley’s investment advisory and asset management business and is chair of the firm’s Investment Committee. Prior to forming Smith Whiley, she was a managing director at Aetna Inc., where she managed a $9.2 billion portfolio.

Dmitri Stockton
President & CEO
GE Asset Management

In April, GE tapped its London-based head of global banking to lead its investing arm with $122 billion in assets under management. Stockton heads a team of more than 400 employees and the management of portfolios for institutional investors worldwide. GE Asset Management oversees the $45 billion pension plan for GE and many of GE’s affiliated insurance funds. Stockton is a senior vice president of GE Co., a member of GE’s Corporate Executive Council, and serves on GE Foundation’s board.

Frederick O. Terrell
Vice Chairman,
Investment Banking
Credit Suisse

Terrell launched his career at Credit Suisse as an associate 28 years ago. Prior to rejoining the company in 2010, he was managing partner and CEO of Provender Capital Group  L.L.C., a private equity firm he founded in 1998 and a former BE 100s firm. His senior-level experience cuts across the bank’s platforms, including investment banking, private equity, mortgage and asset-backed securitization, financial institutions, and federal agencies.

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Shundrawn A. Thomas
Senior Vice President
Northern Trust Investments
Northern Trust-Chicago

Thomas serves as a managing director and global head of Northern Trust’s Exchange Traded Funds Group, a newly established business within the Global Investments division involving a “de novo build.” Thomas is chiefly responsible for strategic planning, product innovation, business development, vendor management, and talent acquisition. His capital market experience spans equities, fixed income, and derivative investment products.

Lloyd G. Trotter
Founder & Managing Partner
GenNx360 Capital Partners

As managing partner at GenNx360 Capital Partners (No. 4 on the BE Private Equity firms list with $600 million in capital under management), Trotter is responsible for the strategic direction for GenNx360 and focuses on industrial business-to-business companies in industries such as industrial water treatment, specialty chemicals and engineered materials, and global transportation component parts.

John O. Utendahl
Vice Chairman
Deutsche Bank Americas
Deutsche Bank

Utendahl focuses on providing strategic advice and cultivating and enhancing major platinum client relationships. With more than 30 years experience on Wall Street, Utendahl founded former BE 100s financial services firm Utendahl Capital Partners L.P. in 1992 and served as chairman of a collection of asset management, private equity, and investment banking firms that have cultivated a number of financial professionals.

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Paul E. Viera
CEO & Partner
EARNEST Partners L.L.C.

Viera leads the firm for more than 300 clients, including municipalities, corporations, and endowments. He developed Return Pattern Recognition, the investment methodology used to screen equities. EARNEST Partners (No. 3 on the BE Asset Managers list with $17.4 billion in assets under management) continues to act as the U.S. Treasury’s sole agent for transactions relating to the $368 million Small Business Administration’s 7(a) securities portfolio.

Monica Walker
CEO & Chief Investment Officer-Equity
Holland Capital Management L.L.C.

As CEO, Walker oversees overall business and financial operations for Holland Capital Management L.L.C. (No. 14 on the BE Asset Managers list with $2.2 billion in assets under management). She also manages the execution of the firm’s large-cap growth and mid-cap growth equity strategies. Prior to joining Holland, Walker was manager of Trust Fund’s Administration, responsible for Texas Utilities’ $1.5 billion pension fund and defined contribution plan.

Thurman V. White Jr.
CEO & President
Progress Investment Management Co. L.L.C.

White is responsible for the vision and values of Progress (No. 4 on the BE Asset Managers list with $6.8 billion in assets under management) as well as leading all of the firm’s operational, financial, and strategic goals. Progress works with 60 emerging firms, managing 25 multi-manager investment portfolios. White is recognized as a pioneering specialist in developing emerging manager investments and recently penned a guidebook for emerging asset managers.

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Raymond A. Whiteman
Managing Director & Co-head, Carlyle Strategic Partners
The Carlyle Group

Whiteman has more than 15 years of private equity and distressed investing experience at one of the leading global alternative asset managers with approximately $153 billion in assets under management. Earlier this year the firm acquired energy exploration and production companies Core Minerals and Black Raven Energy for $20 million and $20.5 million respectively. The company also filed for an IPO last month.

Christopher Williams
CEO
Williams Capital Management L.L.C.
Williams Capital Group L.P.
Age: 53

“We recognize that we are not too big to fail. We have always operated in a manner recognizing that our performance is the only buffer between success and failure,” says Christopher Williams, CEO of Williams Capital Group L.P. (No. 4 in taxable securities with $1.6 billion in lead issues on the BE Investment Banks list) and Williams Capital Management L.L.C. (No. 13 on the BE Asset Managers list with $2.4 billion in assets under management). Williams charges his team with managing the company in a way that reflects a risk-averse, prudent mindset.

His investment bank played a significant role as an underwriter in General Motors’ $20 billion IPO last year, served as co-lead in the $8.7 billion AIG equity offering in May, and was tapped as a senior co-manager in AT&T’s $500 million bond offering. The firm has also formed a business partnership with a yet-unnamed hedge fund-of-funds with some $5 billion in assets under management.

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Edward A. Williams
CEO
Black Enterprise/Greenwich
Street Corporate Growth Partners L.P.

A company co-founder with more than 30 years experience in the financial services industry, Williams was instrumental in developing the investment strategy and raising nearly $100 million for the private equity fund. He is responsible for developing investment strategy, sourcing, executing transactions, and maximizing the value of the fund’s portfolio companies.

Willie E. Woods
President & Managing Director
ICV Partners

ICV Partners (No. 6 on the BE Private Equity firms list with $440 million in capital under management) invests in leading companies with sales of $25 million to $250 million. Prior to co-founding ICV, Woods was a vice president in investment banking at Deutsche Bank Alex Brown, where he was responsible for deal origination and execution of merger and acquisition, leverage loan, high-yield bond, and equity transactions with a focus on financial sponsors in the basic industries.

Kneeland Youngblood
Co-Founder & Managing Partner
Pharos Capital Group L.L.C.

Youngblood’s Pharos Capital Group L.L.C. (No. 4 on the BE Private Equity Firms list with $600 million in capital under management) focuses on providing growth and expansion capital to businesses in healthcare, business services, and opportunistic investments. The firm’s latest partnership is a $400 million to $600 million fund focused on providing later stage equity funding for internal growth, acquisitions, leveraged buyouts, management buyouts, or recapitalizations.

–Additional reporting by Carolyn Brown and Sonja Mack

“The area is a very strong performer over the long term,” says McKissack, whose firm manages approximately $800 million in institutional funds. “The group has underperformed this year, but when you look further out, we feel midcaps will retain their performance advantage and are one of the best places in the market.” The numbers support McKissack’s outlook. Over a 10-year-period ending Aug. 31, the Russell 1000 index of large company shares returned 3.16%. The Russell MidCap index—the types of undervalued shares McKissack selects for his portfolios—were up 7.16%.

McKissack doesn’t foresee a double-dip recession but he does expect “more stresses and pressures” from Europe and a weak U.S. job market. As such, the volatile stock market will continue to bounce up and down. “General sentiment is worse than what we see for the economy, and as a result, we think there are attractive opportunities,” he says. “It’s a good time for investors to add selectively to their positions rather than to switch money to fixed income or cash, which yield practically nothing right now.”

On top of that, dividend payers are particularly valuable in a shaky economy (see “How You Can Profit from Market Volatility,” this issue). That’s because they require a hefty commitment on the part of corporate management. Think of it this way: A company has to be pretty confident about its business in order to share a slice of its profits with shareholders. Dividend payers tend to be large, blue-chip companies with a proven track record of results. It’s that sort of dependability that helps to steady the performance of dividend-paying stocks in turbulent markets.

Then there’s the fact that interest rates on Treasury bonds have been quite low. Abercrombie says dependable companies that pay an above-average yield (the ratio of a company’s annual dividend payout to its stock price) are an attractive substitute.
A Texas native, Abercrombie works in the investment firm’s Dallas office, where he manages money for high-net worth clients. Named a top financial all-star by Black Enterprise in 2010, Abercrombie talked to BE about three of his stock picks.

1) Johnson & Johnson (JNJ) is one of just four companies that carry a AAA grade on its debt. The company offers a 3.6% yield and has been very reliable—it’s made steady payments since 1944 and has increased its dividend annually for the last 49 years. I think the company can accelerate its earnings growth over the next few years thanks to breakthroughs from its biopharmaceutical businesses. The company’s pipeline includes potential new treatments for Alzheimer’s disease, prostate cancer, hepatitis C, and a stroke prevention medicine. In our view, shares do not fully reflect the value of J&J’s pipeline potential, and as a result we believe shares are attractively valued. Meanwhile, J&J should be affected less and less by major patent expirations on earlier products.
STOCK PRICE: $64.36   •   DIVIDEND YIELD: 3.6%

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2) AT&T (T) pays a 5.8% dividend. The telecommunications giant has made payouts since 1984 and has increased dividends steadily over the last 26 years. If completed, AT&T’s merger with T-Mobile USA will make it the No. 1 wireless operator in the U.S. (At press time, the U.S. Justice Department filed an antitrust lawsuit to block the proposed acquisition.) The union should bring about operating savings that will fully offset the purchase price. Over the past five years, AT&T has grown its dividend about 5% per year on average. We expect a 2% growth rate in the next five years. We expect revenue growth in a stabilizing economy thanks to AT&T’s wireless and television businesses.
STOCK PRICE: $28.79   •   DIVIDEND YIELD: 5.8%

3) Kinder Morgan Energy Partners (KMP) which operates oil and gas pipelines and storage facilities, pays a 6.6% dividend yield. Kinder Morgan has some 28,000 miles of pipelines used to transport natural gas and refined oil. The company has paid a dividend since 1992 and has increased its payout to investors the last 14 years running. We think Kinder Morgan can generate low double-digit income earnings growth this year, reflecting acquisitions and increased demand for storage capacity. For the past decade this dividend stock has delivered annualized total returns of 19.5%. What’s more: A $10,000 investment in Kinder Morgan 20 years ago would be worth $190,000 today. In the next year, the company plans to build up its energy transportation and storage assets—one reason we think it is insulated from any decrease in oil or gas prices.
Stock Price: $70.56   •   DIVIDEND YIELD: 6.6%

Kason Davis (Photo by Joe Abraham)

Sure, putting money toward your retirement may not be as exciting as purchasing a new car or taking a lavish vacation, but taking stock of your financial future will help you set the tone for being able to afford and sustain such items later, in some cases twice over.

Just ask today’s retiring boomers whose retirement plans have fallen short. Even for those with Social Security, pensions, and savings, most 401(k) or IRA participants appear to have insufficient savings, according to the Employee Benefit Research Institute.

Facing shortfalls, many people are postponing retirement, working a part-time job, traveling less, and facing foreclosure. Moreover, roughly a third of both workers and retirees who participated in the EBRI study said they had to dip into their savings last year to pay for basic expenses. But besides the economy playing a role in dwindling retirement funds, some started saving too late or suspended contributions when they lost their jobs; others didn’t realize that contributing 5% with a 3% company match would not sustain them during their retirement years.

“We know from previous surveys that far too many people had false confidence in the past,” says Jack VanDerhei, EBRI research director and co-author of the report. “People’s expectations need to come closer to reality so they will save more and delay retirement until it is financially feasible.”

Today more workers than ever have been pessimistic about their retirement outlook. According to a Prudential research study, African Americans recognize that they are behind in retirement planning and saving, and less likely than the general population to feel that they will meet their financial goals (21% vs. 34%). A study by Ariel/Hewitt of nearly 3 million employees further notes that regardless of age or income, African American and Hispanic workers have lower participation rates and contribute less to 401(k) plans than their white and Asian counterparts. As a result, their 401(k) account balances are negatively affected and chances for a comfortable retirement are significantly compromised.

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The stark reality is that you simply can’t rely on Social Security, play a guessing game, or hope to hit the Lotto. Saving for retirement takes careful planning, setting realistic goals, and, most importantly, time. For many young workers entering the workforce, retirement may be the last thing on their mind, but at black enterprise we believe that you can never start too early. Use the following examples to help you get on the path to a bountiful retirement.

INVEST, EVEN WHEN YOU’RE NOT ELIGIBLE
Growing up in a single-parent home on a tight budget, the principle of saving was strictly enforced in Kason Davis’s household. Though at the age of 14 Davis could not grasp the concept of saving and would have preferred buying a pair of the newest Air Jordans or video games, his mother’s lessons now prove beneficial to him.

“My mother always told me that it was more important to purchase necessities and put aside a set amount of money in savings,” explains Davis, now 28. “She would always say the more I saved now, the quicker I could retire.”

Davis was reintroduced to the concept of saving and retirement planning during the summer of 2003 as an intern at Procter & Gamble. “During our intern orientation one of the employees spoke briefly about the importance of 401(k) investing and retirement planning,” says the Houston resident. “Although I wasn’t eligible to invest as an intern in the company 401(k) plan, we were eligible to invest in the company’s stock through its shareholder program.”

After interning with the company for three summers he invested a total of $3,000 in company stock and reaped a $700 gain.

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“That’s when I realized the growth potential that retirement savings provided,” he says. “I calculated on my intern salary that if I contributed that same amount each year and continued to get $700 every three years, I had the potential to earn $7,000 in interest in 30 years.”

Saving for retirement became his first priority when he joined Caterpillar—the world’s largest manufacturer of construction and mining equipment, diesel and natural gas engines, and industrial gas turbines—full time in 2006 as an electrical engineer. The 28-year-old has come a long way since saving $3,000. Working for just five years, Davis has more than $70,000 in his 401(k).

His strategy: Davis invests 10% of his monthly paycheck, or $674, and his company matches 6%, or $405. He currently holds 30% in company stock and 50% in an aggressive mutual fund in his 401(k). “I know this is overexposure to company stock and high-risk mutual funds, but I prefer a riskier portfolio while I am young and plan to slowly reduce my exposure to risky holdings as I get older.”

Outside of his 401(k) he also invests in a Roth IRA, which currently holds $11,584. He and his wife also run their own website design company, AQUE Consulting, and contribute revenues from the business to their IRAs and other investments, having added $3,000 so far this year.

“I opened a Roth after I started investing in my 401(k) because it’s important to look at other forms of investing for retirement, and the Roth allows me more flexibility in my investing options.”

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Davis says that based on his current goals he would like to retire early. “Ideally I want to retire from corporate America at age 55 and concentrate on something I truly enjoy,” Davis says of how he envisions his golden years. “If I can pull $7,000 from my account each month I would be comfortable.”

INVEST, EVEN WHEN YOU HAVE DEBT
After graduating from college, Jennifer Tyus, a law school student at Washington University in St. Louis, and April Tyus, a medical student at Saint Louis University, both had hefty student loan bills. For many recent graduates, retirement is placed on the back burner when debt and new living expenses put competing demands on a paycheck. But these St. Louis sisters knew their retirement savings didn’t have to suffer while they paid down their debts.

“My father taught us a different way of looking at our 401(k),” says Jennifer. “It wasn’t money that I would be missing out on, but actually it would put me in a lower taxable income bracket and would be compounding over the years.”

Their father, Jerone, retired from his accounting position at the age of 58 and is now traveling the world and enjoying the fruits of his 38 years of labor.

“People think they’re missing that money from their paycheck and are so focused on the money that they don’t realize the tax advantages,” says Jennifer, who has chosen to aggressively save for retirement in her company’s 401(k) plan.

Since joining her firm at the age of 25, the now 32-year-old maxes out her 401(k) each year contributing the maximum allowable by the IRS, which is $16,500. Her company currently matches 60 cents on the dollar of her contribution.

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Her sister, April, has been just as diligent. “I started investing with an IRA because my company didn’t have a 401(k) at the time.” April invested about $10,000 into her Roth IRA over three years until her job set up a 401(k) plan in 2007. Through automatic payroll deductions she maxes out her contributions each year and has more than $66,000 in her 401(k), along with a 3% match from her employer, and $13,600 in her IRA.

Many people, start too late because they think they don’t make enough, but April says, “You can still put something away. Do the best you can. It’s better than putting nothing away. And the interest is going to compound over the years.”

She adds: “You can’t just live for today. Don’t put it off and say ‘I’m going to do it later,’ because time passes by quickly. The earlier you start investing, the better the position you’re going to be in in the future.”

INVEST, EVEN IN A DOWN ECONOMY
In the early 1980s, 401(k)s were just being introduced to the American workforce and Robert A. Jacobs, who was 30 at the time, was among the first group of workers to participate.

“I thought it was a great thing because one of the huge benefits of the 401(k) at the time is that the company contributed 6% to it, and that’s just free money,” says the Oakland, California, resident.

Prior to the introduction of a 401(k), he invested 10% of his pay into high-yield savings accounts. By age 30, he already had $30,000 in savings. Jacobs has accumulated close to $700,000 in his 401(k) and nearly $300,000 in mutual funds and about $20,000 in individual stocks.

Even after being laid off in 2008 after nearly 20 years with Oji Ilford USA, a photo supply manufacturer, and left unemployed for 14 months before starting his own consulting firm, Jacobs chose not to suspend his contributions. “One of the basic rules is that regardless of the situation you are in you should still try to save something; put something away from whatever income you get,” he says. Although less than he was saving while employed, he’s still committed to allocating 5% to his retirement savings.

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Jacobs first converted his 401(k) into a traditional IRA, which consists of a series of no-load mutual funds in addition to a small percentage, less than 4%, of individual stocks. Jacobs says he has been successful in saving for retirement by learning and applying the asset allocation model, diversification strategies, dollar-cost averaging, and starting early.
By following these models, he and his wife, Josephine Lee, have been able to protect their assets from market fluctuations.

“During those rare occasions when I was able to anticipate market declines, I shifted our asset allocation from a fully invested position to a much more conservative 40% stocks, 30% bonds, and 30% cash allocation. This not only helped ensure we had cash available to reinvest near the bottom of market decline cycles, but it also helped to minimize but not prevent losses,” explains Jacobs.

They now hold about 70% in stocks, 30% in bonds, and very little cash, which is a fairly aggressive position for his age and one he does not recommend for others close to retirement or who have very little experience in investing.

The layoff and the birth of his son five years ago have pushed back Jacobs’ retirement goal of 62. But due to careful planning in the past, in addition to his home, he and his wife combined have more than $1.2 million in liquid assets and a total net worth of about $1.7 million.