Guggenheim Investment Advisors' name has a cachet that's evident the instant you enter its midtown Manhattan office waiting area. Visitors can peruse coffee-table art books published by the famed Guggenheim Museum. The walls are adorned with colorful abstract paintings by Rudolf Bauer, whose work played a big role in the collection of Solomon Guggenheim, the museum's driving force. Juxtaposed with those is a traditional portrait, in a thick gilded frame, of Meyer Guggenheim, Solomon's father and founder of one of the country's most influential dynasties.

But while cachet is nice, it's a sidebar to the company's main focus: managing money for ultra-high-net-worth families, foundations, pensions and endowments. Security and trust are at a premium amid the triple whammy of economic meltdown, plummeting financial markets and the Bernard Madoff scandal, and the folks at Guggenheim believe this plays to its strengths. 

"As bad as things are and as troubled as the financial markets are, we think this is a great time for us to acquire a lot of clients because we focus on these issues," says Andrew Rosenfield, CEO of Guggenheim Investment Advisors, the wealth management subsidiary of Guggenheim Partners, a Chicago-based global financial services company.

"We're totally unconflicted. We did well, so I think we should get client referrals because as a group they're pretty well satisfied." 

Guggenheim Investment Advisors and its parent company trace their roots to the Guggenheim fortune forged more than a century ago from family-owned mining operations. Guggenheim Partners now encompasses a bevy of services ranging from merchant banking and institutional bond trading to a real estate investment unit formed as a joint venture with Jack Nicklaus that focuses on golf-resort communities built around Nicklaus-designed golf courses. But Rosenfield says Guggenheim Investment Advisors doesn't tap into any of this, including the parent company's bond funds. 

"They're excellent funds," he says, "but we don't allocate to any of that-zero-because we think that clients want complete independence. If you start allocating to them you become a salesman of these products." 

Instead, Rosenfield says Guggenheim Investment Advisors (hereafter, just Guggenheim) relies on its own deep bench of advisors, wealth managers, family office personnel, and two Nobel Prize winners-roughly 150 people in total-to build customized portfolios aligned with each client's needs and risk profile. To do this, Guggenheim leverages its size, resources and contacts to scour the financial world to find top-shelf investment talent across various asset classes that often isn't accessible to smaller advisory firms.  

All told, the company oversees about $40 billion in assets held by roughly 220 clients, which includes Guggenheim family members. The bare minimum asset requirement for individuals and families is $25 million. Guggenheim's fees vary depending on a client's needs. Clients who tap into the firm's in-house family office services pay 100 basis points on an account worth up to $250 million. Beyond $250 million, the fees are adjusted downward. For clients not using the firm's family office, fees are roughly 75 basis points.  

The firm's family office services are delivered by Private Family Office Inc. of Bryn Mawr, Pa., which Guggenheim acquired in 2006.

The Certainty Of Risk
Guggenheim sees asset management as both an art and a science. The art comes from intimately knowing their clients, partly through the application of behavioral finance theory that links finance, economics and psychology. That's where Daniel Kahneman comes in.  

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