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Sunday, October 15, 2023

Down to Business: Investment manager helps make money with money: ‘It’s fun, but it’s also deadly serious’

Business: Herrick Lake Investments

Address: 1155 S. Washington St., Naperville

Phone/website: 630-581-8119, www.herricklake.com ↗

Owner: Mark D. Hines, 46, of Naperville

Years in business: Two

What do you do? “Two things. One, investment management. People who want help managing their investment accounts. Retirement savings. College savings. Those type of things. Two is investment research. This is more for do-it-yourself investors,” Hines said.

How do you manage investments? “I got started in 2015 running a research company with hundreds of people who pay me for research. Then, I got into investment management. We do a portfolio review. I’ll give them recommendations. … Maybe you have too much risk. Too many stocks. Too many bonds. Maybe you’re too concentrated in something. We discuss what to do differently.”

What’s important to know? “Don’t put all your eggs in one basket. Sometimes, people will come in — they’ve worked for a company a long time — and they have 50% of their retirement savings in one company’s stock. That’s a problem. That’s too risky.”

Why is that risky? “If a company goes bankrupt — it doesn’t happen often — you’ll lose all your money. The retirement savings are gone. Even if it doesn’t go bankrupt, bad things happen. Stock prices crash. That’s the diversification piece.”

What do you offer? “I have three model portfolios. One is more aggressive. It’s growth stocks. Another is focused on high income, maybe (for) people who are retired. The third is balanced in the middle of the three. … The models get updated monthly. There are research reports that I write. I work with an independent contractor who helps me write those. He’s in India. His name is Madhu Chaudhary. He’s very good.”

What else plays a role? “It depends on age. On the tolerance for market volatility. Some people can’t stand when Harley-Davidson goes up 10% and down 10%. And it depends on the size of the nest egg and the size of their savings. Do they need to be more aggressive or more conservative?”

How long have you been doing this? “I went in business for myself in 2015. For 15 years prior to that, I worked for a big bank in Chicago, Northern Trust, managing investments. And I worked for a big pension fund in the northern suburbs, managing a couple funds. … I started my research service, Blue Harbinger, in 2015. I started this company in 2021.”

Why do you do this? “You go to college. OK, you have to pick a major. I was good at numbers. Good at math. My dad had a broker. … It’s always been an interest to me. I liked numbers. I liked the stock market.”

What appeals to you? “The intellectual competition. It’s fun, but it’s also deadly serious with people’s life savings on the line. I enjoy it a lot. I enjoy following the markets every day. … The old saying is if you choose a career you love, you never have to work a day in your life. I’m feeling pretty good right now compared to when I worked for the big companies.”

Any favorite stories? “I bought Facebook (stock) in 2012. That’s been a great one for me. … There’s a company in Schaumburg called Paylocity. I bought that (stock) in 2015 for $29 dollars a share and it’s up $200 this year.

“Recently, I sold half my Nvidia stock. It makes chips that go into computers. With the explosion of artificial intelligence in the last six months, it’s skyrocketed, gone through the roof. … I sold half my shares and in the past four months, it’s gone from $200 to $450 (a share).”

Why Herrick Lake? “It’s a forest preserve. It has trails, wildlife, lots of trees. Peaceful.”

What are your fees? “I charge 0.85% of the size of the account. There are no commissions or hidden fees. … You end up paying less that way.”

What do you like best? “The flexibility in the schedule is priceless. … And I like the people. I like talking stocks and investments.”

How old are your clients? “They range in age. I have a 14-year-old client. Her uncle opened the account for her and she gets control on her 21st birthday.”

Is Naperville good for business? “Yes. It’s a huge town that’s wildly diverse.”

What’s your advice for someone starting a business? “Do something you enjoy. That’s the cliché. Cheesy. But it makes all the difference.”

If you know of a business you’d like to see to profiled in Down to Business, contact Steve Metsch at [email protected].

Steve Metsch is a freelance reporter for the Naperville Sun.

James Mackreides
James Mackreides
'Mac' is a short tempered former helicopter pilot , now a writer based in Sofia, Bulgaria. Loves dogs, the outdoors and staying far away from the ocean.

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