Shawn Fowler
Courtesy of Morgan Stanley
Firm: Morgan Stanley Private Wealth Management
Senior Members: Shawn Fowler, Max Bull
Team Custodied Assets: $14.7 billion
Background: Shawn Fowler grew up in Texas in a military family before studying finance at the University of Colorado Boulder. He joined Morgan Stanley nearly 25 years ago. His partner, Max Bull, attended the University of Denver and captained its hockey team to a national championship. He played a year of minor league hockey after college, but soon decided to transition into a career at Morgan Stanley, joining Fowler in 2005; Today, the team number ten people in total serving 93 clients, the vast majority of which are entrepreneurs across industries like defense, healthcare and technology.
Max Bull
Courtesy of Morgan Stanley
Competitive Edge: “Typically clients hire us because we focus on two things: We grow the value of their assets over time but also their cash flow,” says Fowler. “Growth will make you wealthy but cash flow keeps you wealthy.” He emphasizes that this approach keeps clients durable in real time so they have revenue coming in no matter what.
Investment Philosophy/Strategy: “The way we invest capital does not change by client,” says Fowler. “The weight may change by client, but the actual assets we're buying are very consistent for everyone.” In terms of asset allocation, he and his team focus on four groups: Long equity, fixed income, alternatives and cash. “Within equities, everything we do is typically proxied to dividend growth,” says Fowler. “We want real time cash flow coming off our equities, which can either be used to buy more equities or keep our clients durable.” The team uses its own large-cap core dividend growth strategy as well as several other low-cost dividend growth index funds that make up roughly 55% of a client's portfolio. “On the fixed income side, we try to be tax efficient and keep turnover low,” says Fowler. He cites the team's high quality bond portfolios, where every taxable client has roughly 20% to 25% allocation in for-coupon AA or higher rated municipal bonds that were bought at par or cheaper. Within alternatives, Fowler and Bull like to have roughly 10% of a client portfolio in cash-flowing real-estate, with a similar allocation to private equity. “Consistency and durability is a big part of what we do,” adds Bull. “When equity markets decline 20% to 30%, we don't have to change our strategy.”
Investment Outlook: “Equities are trading at above historical averages, but for fully invested clients we are staying invested,” says Fowler. “We are probably looking at a few more rate cuts, but a 3% or 4% Federal funds rate is going to be the new normal.” Going into the end of the year and looking ahead to 2025, he predicts corporate earnings and dividend growth will continue to remain positive, though stock market returns are likely to be more normal,
