Lipe & Dalton start new investment firm

CNY Business Journal (1996+), Feb 18, 2005 by Dickinson, Casey J

SYRACUSE - Willard C. Lipe and Patrick M. Dalton, two veterans of the local investment business, have opened their own firm.

Located in the State Tower Building in Syracuse, Lipe & Dalton Investment Counsel, Inc. offers financial-management services for individual investors, and caters to upscale clients. The two men opened the firm in November.

Lipe formerly served as senior portfolio manager for HSBC Bank. His experience includes seven years of managing investment plans for individuals and institutions. Dalton has a decade of experience and was most recently a senior portfolio manager for J.W. Burns & Co.

Lipe & Dalton specializes in "separately managed portfolios," where the client holds individual stocks rather than mutual funds. The management method, Lipe explains, allows him more control over the portfolio than does a mutual fund.

"Separately managed portfolios let us create a better allocation of stocks and bonds for the client," he adds.

The firm has more than 45 clients with portfolios ranging in size from $250,000 to more than $2 million, says Lipe. A one percent annual management fee, provides Lipe & Dalton's revenues, Clients pay $10 per stock trade as well.

The percentage-of-assets payment model, says Lipe, exposes the firm to more risk than a fee-per-service model and creates an incentive to grow the client's portfolio.

"If we do poorly, there's nowhere to hide," he says. "We're accountable."

Both men hold the Chartered Financial Analyst (CFA) designation. CFA designates must complete a course of education and pass an examination, explains Lipe. The certification test isn't offered in Syracuse.

"We took our exams in Rochester," he explains, "of 60 people, only about four were from Central New York."

Lipe and Dalton had discussed the idea and created a business plan over the year before opening the firm. They financed the business using savings and a small line of credit. Start-up costs were approximately $50,000, says Dalton.

Technology allows the firm to operate with a minimum of overhead, he adds.

Most client trades are accomplished via the Internet. Lipe & Dalton uses TD Waterhouse as its trader, and the company also prints its client statements.

Electronic research tools help Lipe & Dalton to research potential stocks at a rapid pace. The firm subscribes to several research services which provide data on public companies and bond offerings. Software tools allow for sorting through stocks without having to read every line of an annual report. The firm may go through hundreds of companies and end up with only 10 that meet its investment criteria.

"We don't shy away from the analytics," says Dalton, " "This is all we do."

Lipe & Dalton has customers across Central New York and in the Washington, D.C. area as well.

The firm receives new clients referred by a network of attorneys and certified public accountants the two men have built up over their years in the business. Trust accounts, says Lipe, represent an area for growth as some people turn away from bank-managed trusts in search of higher returns.