Thomas A. James
People and their financial well-being were the galvanizing force behind the creation of Raymond James in 1962.
While many had a hand in the firm’s genesis, two leaders in particular are responsible for the steadiness of its foundations and the scope of what it would become:
Bob James, whose passion and perceptiveness built a quietly revolutionary company.
And his son, Tom, whose grit and guidance would make that company something more.
If it was impossible not to like Bob James, it was just as hard not to notice the precocious brilliance of his son, Tom.
When Tom James joined his father’s firm in 1966 with a fresh “MBA” behind his name, it wasn’t what he or many around him expected. He’d fielded offers from McKinsey & Company and Midwestern investment powerhouse Waddell & Reed. But it was the lure of combining further schooling, this time a law degree at Stetson University, with full-time work that brought him home to St. Petersburg. And to Raymond James.
Tom’s head for numbers – something as apparent in his studies at Harvard as it was in his aptitude for music – served him well in his role as controller. Early on, he took an analytical eye to nearly every aspect of the firm, finding ways to streamline operations, expand into new spaces like capital markets and investment banking, and put Raymond James in a position to compete with Wall Street for top talent.
Within four years, Bob, just 50 years old at the time, took the unusual step of offering his CEO title to a 27-year-old Tom.
Tom had been CEO for just three years when the first major test, for him and for the firm, arrived. The market contraction of 1973-74 was a storm that had far-reaching and lingering effects on the economy and the industry – a storm Raymond James ultimately weathered, though not without pain.
The tumult forced the closure of offices mere days after their grand openings and saw Tom and the leadership team log interminable hours looking for every opportunity to trim costs and generate revenue.
On the other side, it became clear that the firm’s culture – values instilled from its earliest days and a level of commitment that made the financial familial – had been as critical to its survival as the timely pivots and abundantly cautious decisions made by its leaders.
And more than survive, Raymond James began to thrive under Tom’s leadership into the subsequent decades. More tests would come – Black Monday in 1987, the dot-com bubble in 2001, the Great Recession – but with Tom at the helm and a vested, vibrant culture as the blueprint, the firm met them head on.
With every major market crisis since 1962, the firm has emerged stronger and more confident – more grounded in its principles, more committed to its mission, more admired by its employees and industry peers, and, most tellingly, more valued by its clients.
Those early challenges and the successes born from them instilled – or perhaps, more accurately, reinforced – in Tom a unique combination of prudence and ambitiousness that has permeated the firm. During his tenure, Raymond James has slowly and steadily grown well beyond its early mission to help retirees plan for the future, but always with that mission in mind. And core businesses and affiliated advisors have grown their strengths, their successes and their possibilities along with it.
Today, as chair emeritus, Tom is still thinking about all the firm his father founded could yet become, and sharing his vision for its future as new leaders emerge to carry Raymond James forward. But for every new record set or innovation realized, he knows it all comes back to people.
The work of Tom James’ life has been building a firm dedicated to protecting the life’s work of others.
1942 – Sandusky, Ohio
Harvard University – Bachelor of Arts in economics, magna cum laude
Harvard Business School – Master of Business Administration with high distinction, Baker scholar
Stetson College of Law – Juris Doctor
Ranked player – 13 and under, Florida
Varsity team – Harvard
One of the largest private collections in the Southeast
The James Museum of Western & Wildlife Art
Husband to Mary
Dad to Hunt and Court
Grandpa to four grandkids
Tom James’ 20 Keys to Better InvestingTom’s personal investing principles, developed through years of experience.
Communicate frequently and frankly with your advisor, particularly about your financial objectives and concerns. An honest, sincere relationship is fundamental to achieving your objectives.
Work with your advisor to develop a financial plan and asset allocation that will guide investment decisions. Review it at least annually with your advisor, inform him/her of any changes to your financial profile, economic circumstances or risk tolerance, and ask for the meeting notes for your records.
Review your trade confirmations and statements from all financial institutions for accuracy, and immediately contact your advisor with any questions or if there are any inaccuracies.
It is better to err on the side of conservatism than to be too aggressive. Keep expectations realistic. Don’t reach for irrationally high returns. Any investment that purports to provide significantly higher than market-rate returns may not perform up to expectations. Seek guidance from your advisor about investment opportunities that may seem too good to be true, such as promissory notes offering extremely high interest rates.
Be skeptical of “guarantees.” Advisors cannot share losses or gains in any client’s account.
Don’t try to “time the market.” Be a long-term investor, practice patience, and adhere to an asset allocation model. Moving to cash increases the risk that you may miss market rallies, which often take place in short bursts. Consider dollar-cost-averaging where prudent by continuing to add to equity investments on a regular basis.
Don’t panic and sell out of the market when investments have declined in value due to a general market decline. That can be the most opportune time to increase investment positions, as long as the fundamentals of the selections remain intact.
Be both receptive to and skeptical of new ideas. Evaluate them carefully and use them in moderation. Innovation in financial markets has generally led to higher levels of complexity. Sometimes simpler is better.
Always strive for diversity among investments, styles and portfolio managers, even when investments appear to offer limited risk. Your due consideration of the incremental costs of diversification is integral to this decision-making process.
As the name implies, income investments should be purchased both for the income that they provide as well as for long-term capital preservation. They should be high investment-grade unless you are willing to assume greater risk in exchange for the growth potential offered by other income-producing investments, such as high dividend-paying stocks, business development companies (BDCs), closed-end funds and other lending-oriented vehicles, many of which utilize leverage or take heightened credit risk.
Inflation requires a growing principal balance to maintain your standard of living. Establish cash distribution objectives that are lower than actual earnings or yields on your investments, and utilize a withdrawal plan that results in a growing principal account balance over the long run. Be mindful of investments, such as master limited partnerships (MLPs) and closed-end funds, which sometimes return capital as part of their distributions.
All, or a substantial majority of, equity investments should be in professionally managed portfolios or in a diversified group of high-quality securities. While emerging growth and small capitalization stocks, mutual funds or exchange traded funds (ETFs) often have a place in many wealthy investors’ portfolios, the vast majority of capital should be allocated to high-quality, recognizable securities with favorable prospects.
You should consider investing part of an equity investment portfolio in non-U.S. equities through professionally managed international mutual funds and asset management portfolios, understanding that there are additional risks associated with international investing.
High-net-worth clients should consider some real estate investments in their asset allocation models. These can take the form of publicly traded equities, such as real estate investment trusts (REITs), professionally managed private real estate funds or individual assets.
High-net-worth clients with sufficient liquidity should consider a small allocation to illiquid investments, such as private equity or venture capital. While these types of investments may offer the opportunity for enhanced returns, they carry increased risk.
Treat individual retirement accounts (IRAs) and other qualified plan investments as very serious money, and let the benefits of compounding work on your behalf over an extended time frame. Generally, do not fund qualified plans with partnerships or other complex investments as they can lead to reporting, valuation and tax complications. If electing to roll over assets into an IRA, carefully review the Rollover Election Certification and consider the costs and benefits before making a change.
Use margin sparingly for investment purposes, as leverage increases risk. However, if borrowing money for non-investment purposes, consider a securities-based loan (SBL) secured by account assets, which is often the lowest-cost borrowing alternative. Maintain the same discipline in paying down a margin or SBL balance that you would with any other loan.
While a prospectus or other investment literature can be intimidating, investing hard-earned dollars is a serious task and requires your attention and involvement. With the assistance of your advisor, read the literature and understand the investment’s fundamentals, risks, potential rewards and costs.
Generally, avoid granting discretion over your investments to anyone other than your advisor, professional money managers, or professional fiduciaries who work with reputable investment firms.
Everyone makes errors in investment selections. Learn to recognize a mistake and take losses early, rather than waiting to recover the original cost. It is generally far less painful to recognize a small loss than to ride an investment to zero.