March 5- Steven Roukis, who helps manage $1.7 billion for Matrix Asset Advisors Inc., says he often spent as much as half an hour on the phone with Wall Street analysts five years ago. Today, Matrix handles twice as much money and he’s lucky to get five minutes with anyone.
“You have to call at off-peak hours, like early in the morning,” just to have a word with an analyst, said Roukis, the director of research in New York.
Hundreds of institutional investors like Matrix are getting short shrift because securities firms now order analysts to ignore everyone but the customers who pay the biggest fees. Wall Street collects $33 million a year in stock-trading commissions from the average hedge fund, compared with $16 million from a mutual fund or equivalent investment manager, according to data compiled by Greenwich Associates.
The brokers call it tiering, which typically rewards Stamford, Connecticut-based SAC Capital Advisors LLC, the $12 billion loosely regulated investment pool, open to only high-net- worth individuals and institutions. Such hedge funds are more lucrative for securities firms because their billings include a variety of brokerage services that cater to customized trading and investment strategies unavailable in the mutual funds.
At JPMorgan Chase & Co., the third-largest U.S. bank, Michael Gambardella says he used to have telephone conversations with almost anyone, even non-clients. Now Gambardella, ranked among the top three steel-industry analysts by Institutional Investor magazine for eight of the past 10 years, screens his calls and sometimes spends more than half the day talking to hedge funds.
