Leo Kelly’s clients at Verdence Capital Advisors are mostly business owners, corporate executives, entrepreneurs and athletes, many whose wealth exceeds $10 million.
They seek advice from the Hunt Valley-based financial advisory firm on decisions such as selling businesses, setting investment strategies, making choices regarding stock options, passing on wealth and establishing a legacy through philanthropy.
“Wealthy clients want to make money and build wealth, but mostly they want to preserve the wealth they’ve worked so hard to build,” said Kelly, 48, CEO and partner in Verdence, which took its name from “veritas,” Latin for truth and independence.
Earlier this month as the stock market plunged, with the Dow Jones Industrial Average tumbling to its largest point decline ever, Kelly said he offered the same advice he has given during the past year’s high flying market.
“Be disciplined, be calm,” he said. “The market tries to make you emotional, and that’s why historically investors do so poorly. They buy high, and they sell low because they become afraid… We are very long-term focused and very calm. We don’t get emotional on the markets.”
Kelly and his team have been building the wealth management business since 2012. That’s when he left Merrill Lynch in Hunt Valley, where he had worked since 1999, including through the aftermath of the 2008 financial crisis when Bank of America bought the retail brokerage for $50 billion.
Deciding to leave the world of big banks and brokerages in 2012, he and six others at Merrill Lynch joined HighTower Advisors, becoming an independent firm in Sparks with $600 million under management. Last July, the group split off from Hightower and opened their own firm, which now has 27 employees and offices in Hunt Valley and Tysons Corner, Va.. Verdence manages more than $2 billion in assets..
Kelly, who grew up in Trenton N.J., said he always had a fascination with the stock market and used to pore over stock tables in the newspaper as a kid.
He remembers thinking, “If I could buy these at $20 and they’d go back to $50, that would be great.”
In high school, he enrolled in a work-study program and would leave school in the afternoons to sell copiers. It proved such a money-maker that he put off college, staying with the copier business and envisioning himself as a manager and eventual owner. But he gravitated back toward finance, enrolling several years later in community college, then The College of New Jersey, where he studied finance and thought about becoming a trader or portfolio manager.
Kelly said his firm, which charges fees instead of a commission, aims to cement long-term relationships with clients, guiding them and their families through decades of financial decisions. That close guidance meant he got few calls — and none panicked — on Feb. 5 when the Dow fell more than 1,000 points.
He said he believes the long bull market in bonds is coming to an end and that a series of trading triggers, rather than fundamental economic problems, spurred the recent market volatility.
“This is supposed to happen,” he said “The aberration was last year when there was record low volatility.”