The Los Angeles area is home to the third largest Chinese population in the U.S. behind New York and the San Francisco Bay Area, and it’s the perfect place for Sean Yu’s $900 million business.
Yu, 42, is managing director of The Sean Yu Group at Morgan Stanley Private Wealth Management where he oversees money for first-generation immigrants from China and Taiwan. Yu, who immigrated to the U.S. from Taiwan at the age of 12, says many of his clients are doctors living the American dream, and looking for ways to grow and maintain their wealth.
That particular segment of clients helped grow his business when he first launched it in 2003. More recently, he’s added clients from a new wave of immigrants who, unlike his early clients, are arriving to the U.S. with loads of money ready to be invested. Yu says they are typically Chinese nationals looking to access U.S. markets to help diversify their portfolios.
Managing money for international clients can be tricky. “Immigrants to this country are more used to brokerage-style advice from Singapore or Hong Kong” that tends to be more transactional, he says. “I tell them we are more like an endowment, looking at asset allocation and risk among varied factors,” Yu adds.
Wealthy clients often have high expectations from their financial advisors, and investors from China are accustom to big returns. Yu makes sure these clients know what they’re getting into as he aims to create a long-term relationship. “It is much harder to make money here, compared to in China, so in addition to focusing on that, I talk to clients a lot about adding community value with their money through a donor advised fund or similar type of vehicle. If they want to stay here for the long run, I want to help them make sure they know what is important to them and what isn’t.”
It seems to be working. Yu estimates his average client, typically worth $30 to $50 million, gives him roughly $10 million to invest and manage. The firm, ten employees including Yu, works with 100 households and new clients are required to have at least $5 million in assets to join.
Yu relies on two investment advisors to help with retirement and other financial planning aspects of the business while he focuses primarily on client portfolios. Yu says his current asset allocation mix is 60% in bonds and 40% in stocks. Yu plans to allocate more assets towards private equity through trusts which he hopes will benefit his next generation of clients: the children and grandchildren of existing clients.
This article originally appeared on Forbes.
