Advisers scramble to calm clients after market suffers big drop

Thursday's stock market whipsaw sent many financial advisers into client management mode — fielding calls and sending out soothing e-mails as the Dow Jones Industrial Average briefly tested a record 1,000-point drop. “I was proactive in sending out an e-mail to clients yesterday and then another one [Friday],” said Rick Jurrens, president of F.I.G. Financial Advisory Services Inc., which has $60 million under advisement. Mr. Jurrens, who received calls and e-mails from three of his 230 clients regarding the stock market volatility Thursday, was in the majority of advisers surveyed Friday by InvestmentNews. About half (49.6%) of 1,129 advisers said that they heard from concerned clients in the wake of Thursday's market madness. And 60% of advisers said that they reached out to clients to offer reassurance. “Given the market reaction with these huge swings, we're confident that making some pre-emptive moves was appropriate,” said Leo Marzen, who oversees $850 million as principal at Bridgewater Advisors Inc. He said that he received a few calls from clients Thursday while he was preparing a communication to explain steps he was taking to protect his clients' portfolios. One move was to reduce exposure to European equities in the wake of Greece's debt troubles. Advisers who didn't immediately reach out to clients said they were waiting for the dust to settle and for the cause of Thursday's market drop to become clear. “It was clearly frightening but nothing to get too excited about,” said James Olsen, owner of Crown Capital Securities LLC, which has $70 million under advisement. “I haven't reached out to my clients yet, because I'm waiting for some perspective on what happened,” added Mr. Olsen, who said he received a call from one of his 150 clients regarding the market's recent activity. Mark Muto, a financial adviser with Cowden Associates Inc., a $200 million advisory firm, said that he talked with clients after Thursday's turmoil, and the subject of the markets volatility “didn't even come up.” “I'm not too surprised that I haven't heard from any of my clients because I think a lot of investors are getting used to getting bludgeoned in the markets,” he said. “Until it's clear in my mind what actually happened, I won't reach out to clients to discuss it.” Hilary Johnson contributed to this story. E-mail Jeff Benjamin at [email protected].