Making A Match

 

Sutton Marks was displeased.

Marks is president of Gordon Marks & Co., an advertising agency headquartered in Jackson, Miss. With 22 employees and some $6 million in annual billings, the agency is one of the largest in the state; it counts among its clients such local luminaries as the region's biggest savings and loan association, the state branch of Blue Cross/Blue Shield Inc., and Delta Catfish Processors Inc.

The source of Marks's unhappiness was not his business, which was doing fine, but the management of its money -- in particular, his company's profit-sharing plan. The plan was in the hands of a local bank, which had put most of the funds into bonds floated by churches to finance new church buildings. The interest rate was not competitive, and Marks thought he could do a better job himself. So he pulled the money out and tried to run the plan on his own.

Then he read an article about Mike Stolper, a San Diego -- based investment-management consultant. Stolper, the article said, would find an investment manager for profit-sharing plans, pension funds, and other pools of money, and would monitor the manager's performance. Marks called him up, talked things over, and made a deal. Stolper eventually placed the money with Astor & Associates, a management company in Larkspur, Calif. Almost immediately, the profit-sharing plan's assets began to rise.

That gave Marks another idea. His parents, then in their 80s, had asked him to take on the job of managing their personal portfolio in addition to his own. Keeping an eye on two portfolios was a time-consuming task, Marks found, and he worried that he wasn't doing it as well as he should. Maybe, he thought, there were money managers who could do it better. Again he sought Stolper's advice, and again Stolper had a recommendation: W.P. Stewart & Co. of New York City. Marks got in touch with Robert Kahn, a senior vice-president at Stewart.

Kahn, by his own account, likes to work with investors that are looking for steady growth over the years rather than for quick killings -- and in fact advises investors seeking active trading to go elsewhere. That fit well with Marks's objectives. "I wanted to be a bit more conservative with this money because of my parents," he says. "I did not want to be speculative or invest in volatile stocks." In June 1983, he signed on with Kahn.

Volatile or not, Kahn hasn't done badly by Marks. The period from June 30 to the end of the year was not a great season for stocks in general; the Dow Jones Industrial Average was up only a little over 5%, and Standard & Poor's 500 Index was up only .21%. Marks's portfolio, outdistancing them both, increased in value by better than 13%. In the first quarter of this year, the portfolio was down 3.4%, as against the Dow's decline of 6.34%.

"It's still early," Marks says, "but I think this indicates good performance."