Kathy King
kingk@folioinvesting.com
703-245-4892
Mutual Friends
(by Skip Kaltenheuser, Taking Stock)
December 2000 — Gone are minimum investment requirements and expense ratio bills. Gone is frustration over lack of input in a fund’s selection. Gone is the ethereal sense of detachment from not actually owning the stocks. For a flat fee of $295 a year, consumers can assemble up to three baskets, or FOLIOs, each containing as many as 50 stocks Stocks can be selected by the consumer, or they can be chosen from a long list of specialty prefab portfolios. Once the basket is in hand, its purchaser can trade the stocks it contains, rebalance the FOLIO as often as desired, or trade it in its entirety. As long as trading is done during two daily time windows, there is no getting nickel and dimed every time a trade is made… As each purchase and sale is tracked as an individual tax lot, FOLIO picks the exact shares that minimize the tax bill. more
The allure of the FOLIO concept is the reduction of “company specific” risk—risks associated with concentrations of a few stocks—by spreading investment over enough stocks so that long-term winners will more than compensate for the losers.
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Armchair Analysts
(by Mark Ingebretsen, Access)
November 26, 2000 — In addition to baskets of stocks, FOLIOfn lets you trade individual stocks commission-free It’s less than you’d likely spend on sales charges and management fees if you invested, say, $10,000 in a traditional mutual fund. If you trade individual stocks often, you’ll probably save even more, since most online brokers charge between $7 and $20 each time you buy or sell a stock.
Should You Build Your Own Index Portfolio?
(by John Waggoner, USA Today)
November 3, 2000 — FOLIOfn, an Internet brokerage, caused an enormous stir five months ago when it rolled out its new concept: Prepackaged baskets of stocks, called Folios, that investors can buy and trade for a flat fee. The concept: Investors can save on fees, keep taxes low and customize their portfolios. The idea has caught fire.
Folios: The Next Wave In Investing?
(by John Kimelman, CNBC.com)
November 2, 2000 — Imagine putting together a portfolio of 20 to 50 stocks and paying between $200 and $300 a year in brokerage fees for the privilege. Now imagine putting together two or three such portfolios and paying no additional charge. more
If that tease has grabbed your attention, you probably have heard the siren song of FOLIO Investing, arguably one of the more compelling and innovative investing concepts to come along in recent years. The idea is simple: Instead of buying a mutual fund, you sign up for one or more prefab portfolios and, through an online service, accumulate the appropriate shares. The key advantage: the ability to assemble a large, diversified group of stocks at a low price.
…FOLIOfn… offered the first Folios to the public for a rate of $29.95 a month or $295 a year.
“Securities houses once said that this couldn’t be done, but we have proven that that isn’t the case,” says Steven Wallman, FOLIOfn’s chief executive.
With a Folio, the investor actually owns the individual stocks in the portfolio and is free to buy or sell shares, often for no additional fee outside of the basic charge… Like a stock mutual fund, a Folio consists of a portfolio of securities that are often constructed to achieve a certain desired risk tolerance. But that’s where the similarities to mutual funds basically ends.
…a Folio investor has an added measure of control over the kind of taxes that the portfolio will generate. That is a key benefit over fund investing, which sometimes provides nasty year-end surprises… “It’s got clear tax advantages over a mutual fund,” says Lewis Altfest, a certified financial planner based in New York.
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Stock List Investing Just Got Easier
(by Ken Waggoner, Mutual Funds Central.com)
October 25, 2000 — Investors can now own personalized stock portfolios, or so-called synthetic funds, based on FORTUNE magazine’s America’s Most Admired Companies and The World’s Most Admired Companies lists. Just introduced by FOLIOfn, these baskets of stocks—or “Folios”—contain the Top 10 companies on FORTUNE’s list of America’s Most Admired Companies and the Top 25 companies on FORTUNE’s list of The World’s Most Admired Companies. more
While anyone could follow the performance of the stocks in these lists, buying and managing them could prove difficult. The FOLIOfn model allows dollar-based investing for a flat fee, with no minimums, commissions, or asset-based fees, and offers investors the flexibility to modify their portfolios as they choose.
“For years, people who wanted to invest based on news articles or lists of leading companies typically had to choose just one or two stocks to buy—which can be very risky,” said Steven M.H. Wallman, founder and CEO of FOLIOfn.
“Investors usually would have paid separate commissions for each stock purchase in addition to the cost of the stock, such as 10 or 100 shares. These costs make it simply too expensive for most investors to buy and regularly invest in more than just a few stocks. For the first time, FOLIO Investing offers an easy and affordable way for investors who value that information to buy the entire list and better manage their risk,” he added.
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Personal Portfolios: A Rapidly Growing Alternative to Mutual Funds and Stock Picking
(by Robert Hegarty, Tower Group Report)
October 2000 — …by combining model portfolios with advice, trade execution, and favorable fee schedules, the personal portfolio firms are appealing to several segments of the individual investing community: disenchanted mutual fund investors, beaten-up stock pickers, frustrated capital gains tax payers, cost-conscious index fund investors, technology-savvy Internet investors, and others. Because personal portfolios have properties that mitigate at least some of the negative contributors to these segments, they are likely to gain traction very quickly. more
As indicated by its name (f for financial; n for the last letter in innovation), FOLIOfn is the pioneer of the personal portfolio industry.
FOLIOfn’s business model includes an internal trade execution platform that helps the firm keep trading costs low and maintain control of its trade processing… This feature makes FOLIOfn the only firm that provides all three key components of a personal portfolio: analytics, advice, and trade execution.
The unlimited free trading along with the tax tracking and tax planning capabilities of FOLIOfn allows investors not only to avoid unexpected capital gains but also to more actively manage their taxes. That is, they can sell losers at year end, replacing them in their FOLIOs after the appropriate waiting period.
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Build Your Own Mutual Fund
(by Gregory Taggart, Bloomberg Personal Finance)
October 2000 — Today, with one click of your mouse, you can buy and sell fully diversified portfolios of hundreds of stocks… That’s simplicity. more
The fn [in FOLIOfn] stands for financial innovation—and there’s lots of it.
In most cases, FOLIOfn has a pricing advantage over online and discount brokers… Even mutual funds can fare poorly in a cost comparison with FOLIOfn…
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Heroes: 10 Unsung Champions of E-finance
(by Jeanne Lee, Money)
October 2000 — Wallman is an innovator. At the Securities and Exchange Commission, he was an early proponent of decimalization… a soon to be initiated move that will save investors billions. Now he’s utilized the technology of the Web to shake up the mutual fund industry. At FOLIOfn, individuals can create and modify their own personalized portfolios of up to 50 stocks for a flat fee of $295 a year. Compared with funds, that’s a more flexible (and potentially cheaper) way to diversify… Says Wallman: “We want people to rethink the way they invest.”
FOLIOfn Touts a Better Way of Investing
(by Barbara C. Costanza, CBS Marketwatch)
September 25, 2000 — In a time when oil prices are souring, the euro is weakening and the stock market continues its volatile behavior, many investors might be looking for a different way to invest. "Steve Wallman, founder, chairman and chief executive officer of FOLIOfn says his company offers that way: a customized basket of stocks that an investor can own and control without a huge cost.
Doing Without Mutual Fund Managers: New Internet Firms Are Causing Ripples in the Industry with Offers of Do-it-Yourself Portfolios
(by Jerry Morgan, Newsday)
September 24, 2000 — So, are you ready to be your own fund manager? FOLIOfn makes it easy. It created 80 prepackaged Folios, which look like mutual funds. But unlike funds, FOLIOfn has no expenses, and there is no portfolio manager running the fund or making the capital gains tax decisions for you.
FOLIO Investing Puts Buyer in Driver’s Seat
(by Melissa Preddy, Detroit News/Free Press)
September 17, 2000 — Another advantage over mutual funds: The consumer manages the income-tax impact by controlling the buy and sell decisions.
Do-it-Yourself Mutual Funds
(by Charles A. Jaffe, Boston Globe)
September 13, 2000 — FOLIOfn… is the first firm to offer custom baskets of stocks that, essentially, replace funds. “Unlike a traditional fund—where capital gains generated by the manager’s trades become your annual headache—you control the Folio’s tax bill. You can sell losers, hold winners, and manage your money for maximum tax efficiency.”
Custom-made Mutual Funds
(by Janet Novack, Forbes: Best of the Web)
September 11, 2000 —"…Say you’re a disciplined saver who has always invested $500 or $1,000 a month in diversified mutual funds. For $295 a year, FOLIOfn will spread your monthly contribution over three "Folios" containing up to 50 stocks each. That’s less than you pay annually to keep $25,000 in a typical managed no-load fund. You can create these Folios from scratch, or customize one of 75 templates on the site, each designed to match a certain style or sector, for example, large cap, aggressive growth, biotechnology. And if one of the stocks tank, you can do a little tax swapping—sell that stock for a tax loss and replace it with an equivalent one.
Now planners can pick baskets of stocks
(by Sarah O'Brien, Investment News)
September 11, 2000 — FOLIOfn waded into the retail market three months ago and now has its eye on another pond—the institutional market. more
The online investing company in Vienna, Va., has hired Jeff Helms, 40, to lead efforts to get its custom-made baskets of stocks, called Folios, into the hands of financial planners and advisers.
The push to reach advisers and planners comes at a time when investors increasingly are seeking alternatives to mutual funds…
“We’ve been inundated with requests from the institutional community for a product that offers the flexibility and features of the retail product,” says Mr. Helms. “In fact, there are advisers using the retail product to manage client assets now.”
With taxes a concern for many investors, Folios and similar investments could find a welcome audience among advisers who do tax planning for clients.
“Mutual funds aren’t very tax efficient, and you don’t actually know what’s in them except maybe twice a year,” says Jay R. Penney, a certified financial planner with Walker Hebetz & Penney LLC in Phoenix who has $75 million under discretionary management. … “If they do what they say they’re going to do, I’ll be able to create as tailored a portfolio as I want.”
In other words, he could sell stocks that dropped in value to get the capital loss and hold the stocks that went up to avoid capital gains.
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A Closer Look at Build-Your-Own-Fund Web Sites
(by Mark Ingebretsen, The Street.com)
September 2, 2000 — [FOLIO Investing is] an intriguing idea and one that ties in nicely with the popularity of exchange-traded index funds… The stock baskets you build with FOLIOfn are a little like index shares. But…there’s a lot of flexibility in how you customize them.
Do-it-Yourself Mutual Funds
(by Rebecca McReynolds, CNBC.com)
August 28, 2000 — Low fees are only part of the advantage… When you buy one of these Folios, the underlying stocks are never traded unless you [make] the trade yourself. That gives the investors both control over their investments and control over their taxes.
Web Trading for Every Budget
(by Fred Barbash, Washington Post)
August 27, 2000 — With each Folio, you can screen out (or in) and stock you choose. “If you want to sell, you can. You can weed our losers, or balance losers with winners for tax purposes. That flexibility is among the major advantages Foliofn has over mutual funds, where you have no control over the tax consequences of the manager’s buying and selling.”
September 21, 2000 —One of the most intriguing features of Foliofn is the ability to rebalance your portfolio should market moves throw it out of whack… One FOLIOfn feature we’d like to see catch on is the ability to pay… by credit card, rather than having the fees deducted from your investment account.
August 15, 2000 — A new online service even small investors diversify their holdings for less than a broker would charge. And there are no account minimums. more
The Folio idea, created by Steve Wallman, a former Securities and Exchange Commission member, is a cross between a mutual fund and an online brokerage account.
As with a mutual fund, investors get a well-diversified portfolio without having to spend the thousands, even the hundreds of thousands of dollars, needed to buy all those stocks.
…[T]here are other advantages to FOLIOfn. By deciding when to buy and sell, you control when you pay taxes.
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Online Funds, Built to Order
(by Patrick McGeehan and Danny Hakim, The New York Times)
August 13, 2000 — “There’s a lot of potential in the idea,” said John Rekenthaler, director of research at Morningstar, Inc. “Diversification with more customization, more ability to control one’s tax bill and potentially lower costs—that’s an attractive combination.”
FOLIOfn Envisions a Revolution
(by Mark Schwanhausser, San Jose Mercury News)
August 12, 2000 — Once considered a farsighted SEC commissioner, Steve Wallman now has launched an online brokerage that even competitors say could spark a ‘revolution’ in how investors buy and sell stocks and mutual funds. more
…[H]is Internet-powered brokerage has the potential to turn so-called separate accounts favored by the wealthy into a middle-class staple.
Perhaps most important for stock-oriented investors, however, you can diversify your portfolio inexpensively, which can reduce your investment risk.
“It’s a great concept, and it’s elegant in its simplicity,” said Ted Allrich, the Woodside founder of The Online Investor Web site and author of a book by the same title. “Instead of buying shares, you buy dollar amounts, and that way you get stocks you otherwise couldn’t afford to buy. Literally, you could say this wasn’t possible until this guy came along.”
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FOLIOfn On Fire: Firm Makes Hot List
(by Eric Wing, Washington Business Journal)
August 11–17, 2000 — If FOLIOfn gets any hotter, it’s going to burst into flames. more
Steve Wallman, founder, chairman and chief executive officer of FOLIOfn says his company offers that way: a customized basket of stocks that an investor can own and control without a huge cost.
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August 7, 2000 — Move over, Charles Merrill, Charles Schwab, Edward Leffler. Make way for Steven Wallman, who at age 46 could join you in the annals of mass-market financial ground-breaking. more
Wallman’s Internet-based brainchild is not likely to push the competition toward extinction. However, it could force them to fight considerably harder for investor money by cutting fees or even imitating him… His product is so flexible and so user-friendly, it can meet just about any investment fit.
Wallman contends that it is far easier for an investor to research industry trends than individual companies. Who but full-time analysts and portfolio managers have the time to read all of a company’s SEC filings like 10Ks, he asks, let alone the ability to understand everything in the filings? Building a portfolio one stock at a time is ‘really hard,’ costly and risky for the average investor, he maintains. “You end up playing a guessing game.”
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FOLIOfn Lets You Customize Your Own Portfolio
(by Russel Kinnel, Morningstar)
August, 2000 — You’ve probably heard about FOLIOfn, a company that lets you invest regularly in a customized portfolio for a low cost. In addition, it makes it easy for you to rebalance your portfolio. “… [I]f you’re a regular stock investor and you’d like to dollar-cost average into stocks of your own choosing, it is probably a good deal.”
Internet Innovator
(by Ellen Uzelac, Research Magazine)
August 2000 — As the tough-talking, reform-bent Commissioner of the SEC, Steven Wallman gave speech after speech advising Americans to study up before making their investment picks. more
Now comes this postscript: He had it all wrong.
“We have inculcated in this country a whole concept of how to invest that’s really not as efficient, straightforward, easy or wise as the real way people should be thinking about investing,” says Wallman…
The real way? Think of it as Wallman’s Way, and it’s getting a lot of attention on Wall Street.
With FOLIO Investing, Wallman has created a brand new financial product that turns stock picking on its head. Here’s how it works: Instead of trying to pick individual winners, an investor buys an entire portfolio that matches his needs.
“We really are a new category” according to Wallman, who says there is room in the marketplace for both his creation along with traditional products and services. In fact, his firms is in talks with a number of financial service providers—broker/dealers among them—about distributing the service to proprietary markets.
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Mutual Competition
(by Jason Zweig, Money Magazine)
August 2000 — When Wallman says “We’ve combined the diversification benefits of mutual funds with the customized service of a brokerage to rethink how you invest,” he’s not kidding. more
Here’s how Folio works: for a $295 flat fee (or $29.95 a month), you can assemble up to three investment baskets or ‘Folios,’ each containing as many as 50 stocks. You can choose the stocks yourself or select from nearly 80 prefab Folios—one holds the 30 stocks in the Dow, another is a basket of 19 companies that sponsor or benefit from NASCAR racing. You can trade as often or as seldom as you like at no extra cost… You can invest automatically every month, and Folio offers one of the best tax-tracking tools I’ve seen…
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Fund’s New Rival: Web Sites for Trading
(by Kathy Bergen, Chicago Tribune)
July 30, 2000 — … [T]he FOLIOfn model has definite appeal for individual investors, many observers say. more
For the annual or monthly fee, FOLIOfn allows investors to create and trade three portfolios. They can select from 75 prefab portfolios that reflect particular indexes, sectors or risk levels. They can modify those baskets or create their own portfolios from among nearly 2,500 stocks.
“It’s very economical to add to your holdings regularly,” noted Nancy M. Smith, a former SEC administrator who is FOLIOfn’s vice president of Web content and education.
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Following the Money: Financial Services and the Net
(by Kevin Werbach, Release 1.0)
July 26, 2000 — FOLIO Investing is the kind of product innovation that investment banks and other firms have been developing for years for institutional investors, but which historically haven’t been available for individuals.
One on one with Steven M.H. Wallman
(by Sarah O’Brien, Investment News)
July 24, 2000 — Steven M.H. Wallman spent several years as a Commissioner at the Securities and Exchange Commission wondering if there was a better way for people to invest in the stock market. Every time he delivered a speech on investing wisely, he’d go through the typical laundry list of advice: Read SEC filings, evaluate the share price, etc., before you buy any stocks. more
“It’s really almost absurd when you’re telling hundreds of thousands of people to do [their homework],” he says. “But it’s the best you can do, in terms of the system, when I was giving those speeches.”
Soon after leaving the SEC in 1997, Mr. Wallman began working on a project to fix what he views as a flaw with both stock picking and mutual fund investing. The result is FOLIOfn Inc., a securities firm based in Vienna, Va. Launched in late May and financed by the likes of Internet backbone powerhouse PSINet of Ashburn, Va., the firm is offering its first service, known as FOLIO Investing…
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bye, Fidelity
(by Rob Norton, eCompany)
July 2000 — I recently stumbled across a Web-based financial innovation that I think really is potentially revolutionary … You can think of Folios as a sort of mutual-fund alternative for the new economy. more
One reason FOLIOfn resonated so strongly with me is that it answered a question I had been mulling for months …How could an investor—if he or she thought the stock market as a whole was sound but that the dotcoms and tech companies were overvalued—best put together a portfolio of stocks that would be, in effect, the overall market minus the Net and tech sectors? I assigned the story to a reporter, and a week later, the answer came back: No way it can be done unless you mix in some fancy—and risky—things like short positions of options … As soon as I first saw the FOLIOfn press kit, I realized here was the answer to my friend’s question—and an entirely new financial critter.
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American Century Ventures Takes Stake In FOLIOfn
(by Desiree J. Hanford, Dow Jones News Service)
July 11, 2000 — American Century Ventures, the investment arm of American Century Investments (X.ACC), has bought an undisclosed stake in online financial services company FOLIOfn. more
Wallman, [FOLIOfn’s] chief executive, said the American Century Investment is “an important message to investors about the strength and wonder of a new idea and a new financial innovation.”
[American Century Ventures President Harold] Bradley said American Century will continue to focus on the performance of its mutual funds. But he said the Internet offers investors an opportunity to personalize their portfolios, and if American Century doesn’t recognize that need, its investors will go to places that do. 'We want to be aligned with, partnered with, strategically involved with those companies that look at customers from all angles,' he said.
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The Best of Both Worlds?
(by Mike McNamee, Business Week)
June 12, 2000 — When Steve Wallman surveyed individual investors’ options from his seat on the Securities & Exchange Commission in the mid-1990’s, he didn’t like what he saw … So when Wallman left the SEC in 1997, he set out to create an investment vehicle that combines the diversification of funds with the advantages of individual stocks. The result is FOLIOfn, his Vienna (Va.) online brokerage. more
There’s no minimum for Folio accounts or trades, and to make Folios affordable, FOLIOfn can sell you fractional shares of stock. That means that an investor with, say, $100, can buy all 30 stocks in the Dow Jones industrial average—receiving one-twentieth of a share of each stock—and can reinvest the dividends.
Customers can be their own managers, modifying Folios—striking tobacco giant Philip Morris, say, from the Dow-based Folio—or creating their own with the site’s tools. More important, a Folio investor owns the stocks, which can be bought and sold in groups or individually. That boosts investors’ flexibility and can reduce tax bills.
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Tax Smart Investing—The Taming of the Code
(by Janet Novack, Forbes)
June 12, 2000 — Then there’s FOLIOfn.com, an intriguing new service launched in May by former SEC commissioner Steven Wallman. For a flat $295 a year investors can maintain three ‘Folios’ with up to 50 stocks in each. You can build our own special portfolio or pick from dozens of prepackaged ones designed to mimic a stock index or a style (say large cap, or value), a sector or a certain level of risk. more
The key is that investors who use dollar-cost averaging can put in their $100 or $1,000 a month—just as they might make contributions to a mutual fund—and the money will be spread evenly over the Folio, including into fractional shares. Meanwhile, the service tracks an investor’s taxable basis in each stock separately. It was always possible for people with $10 million to do this sort of thing. Now the $100,000 crowd can participate, too.
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Folios: A new way to invest — Online brokerage offerings are ‘intriguing’ fund experts say
(by Jeanne Sahadi, CNN.com)
June 2, 2000 — For those disenchanted with mutual funds—their cost, restrictions on when they can be bought and sold, once-a-day pricing or investors’ inability to control the tax bite they impose—there’s a new choice. FOLIOfn, a new online brokerage, seeks to give investors the advantages of stocks with the diversification of mutual funds. more
FOLIOfn, which only recently opened to the public in May, differs from mutual funds in a number of ways. When you buy a fund, you have no say in the fund’s holdings, nor do you own the underlying shares. There may be minimum investment requirements and investors pay an expense ratio, which in the case of actively managed funds can total several hundred dollars a year, depending on your account size, not including any one-time commissions to buy the fund.
With FOLIOfn… investors can create up to three baskets—or Folios—of up to 50 stocks each and customize them in accordance with their investment goals and risk tolerance …The shares are owned by you and may be sold off individually …Since you control turnover in your Folio, you can also better control the tax implications on your investments.
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Another way to sidestep mutual funds
(by Mary Rowland, MSN MoneyCentral)
May 31, 2000 — For the annual fee, you get unlimited trading in three portfolios of up to 50 stocks each, with automatic reinvestment of dividends. Because FOLIOfn, a registered broker/dealer, makes the trades itself, portfolios can be assembled using fractional shares with regular monthly or quarterly investments. more
The ‘Folios’ address most of my complaints about funds right off the bat. The fee is reasonable. You know exactly what you’ve got. Indeed, you decide exactly what you want. And no money managers trade in your portfolio while handing you the capital-gains tax bill. In fact, you can do some pretty sophisticated tax planning, like selling off only the losers at year-end if you like.
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Feel the need to pick your portfolio? Investors can try their hand as fund manager at affordable prices
(by John Waggoner, USA Today)
May 26, 2000 — [L]ike many things reserved for the very rich, having your own diversified stock portfolio had certain advantages … And thanks to the Internet, owning a portfolio of individual stocks isn’t reserved for the very rich any more … One interesting recent example is FOLIOfn (www.FOLIOfn.com), an Internet site headed by Steve Wallman, a former commissioner at the Securities and Exchange Commission.
Reinventing the return: PSINet chief on stock trading software: “I couldn’t stand it; I had to invest!”
(by Eric Winig, Washington Business Journal)
May 26—June 1, 2000 — Steve Wallman is a man on a mission. A soft-spoken former commissioner at the Securities and Exchange Commission wants to do no less than fundamentally tear apart traditional investing practices. Wallman’s company, FOLIOfn—the fn represents financial innovation—has created a completely new way to invest in stocks, and it has the potential to forever alter the global investment landscape. more
Bill Schrader, CEO of Ashburn-based PSINet, had difficulty finding words to express his enthusiasm when Wallman pitched the concept to him. “I couldn’t stand it; I had to invest!” he practically yelled.
[T]he true strength of FOLIOfn is in the details. The company can accommodate virtually any request related to stock trading—from rebalancing a portfolio to deciding what stocks to sell to minimize capital gains taxes.
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Exchange-Traded Funds are Only the Beginning
(by John Rekenthaler, Morningstar.com)
May 19, 2000 — Lurking on the horizon are radical, Internet-based offerings that take the advantages for which ETFs were created—low cost, tax awareness, and liquidity—several steps further. Witness dot-com start up FOLIOfn, which sells the ability to construct, maintain, and monitor a personalized mutual fund (including commissions on all trades and the ability to make tax-related trades on command) at an all-in annual price of $295.
The Unmutual Fund: An Iconoclast Says He Has a Better Idea for Individuals
(by Patrick McGeehan, The New York Times)
May 18, 2000 — Mr. Wallman says he has found a better and, in many cases, cheaper way for investors to create their own, customized baskets of stocks, which he calls Folios, and two months ago he started selling them over the Internet. more
For a fee of $295 a year, Mr. Wallman’s company, FOLIOfn, will let investors create their do-it-yourself stock funds, containing as many as 50 stocks each and as much money as they choose. For no additional charge, they can make changes in their holdings as often as twice a day…
…Said John Rekenthaler, research director for the fund tracking firm Morningstar Inc. in Chicago. The Folio concept “is a pretty big idea that’s going to stick in some form”…
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25 Hot New Companies
(Fortune Small Business)
May 2000 — Who better than a former SEC commissioner to show you how to customize your own mutual fund? Steven Wallman, who spent three years at the SEC spearheading the introduction of online trading, has started an online service called FOLIOfn. The service lets investors marry the diversification benefits of a mutual fund with the extra oomph of investors’ own stock picks … Backed with more than $75 million the company, based in Vienna, Va., “is definitely a David versus Goliath play” in taking on the mutual fund industry, admits Chairman and CEO Wallman, age 46. Wallman has the vision thing (“We want to change the investing world,” he says) and several additional online products in the works. Move over, Mr. Schwab.
The Online Finance 40—Steven Wallman, Chairman, FOLIOfn
(Institutional Investor Magazine)
May 2000 — The ubiquity and easy access of the Internet play right into the hands of Steven Wallman, a former securities industry regulator whose latest venture, FOLIOfn, could give the mutual fund industry a run for its money. Says he, “I want to encourage things that help democratize financial services.” more
Scheduled to open this month, FOLIOfn puts powerful online analytics like stock and investment-style screens at the disposal of individual investors, allowing them to become their own fund managers. Investors can choose from pre-selected ‘Folios,’ or portfolios of stocks that represent different industry groups or risk parameters. Or they can input financial goals and constraints, which are run through stock selection screens to produce customized portfolios. In either case, there’s not a fund manager in sight.
Investors access the service directly through the FOLIOfn Web site, but the company is expecting alliances with financial advisers and other intermediaries. Wallman, 46, a well-regarded corporate lawyer, who served on Securities and Exchange Commission from 1994 to 1997, made his name pushing through regulatory exemptions for early online finance pioneers.
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Buying stock a little bit at a time
(by Borzou Daragahi, Money Magazine)
May 2000 — …FOLIOfn offers something different. For $295 a year you get access to unlimited trades…in what the company calls ‘Folios’ or preset baskets of as many as 50 stocks assembled to represent a particular industry, index or risk tolerance… The idea is innovative and Folios could provide easy diversification…
Do-It-Yourself Fund
(by Melynda Wilcox, Kiplinger’s Personal Finance)
May 2000 — This Spring you’ll have access to a whole new way of buying stocks, which could be as revolutionary as former Vanguard chief John Bogle’s introduction of index funds 25 years ago. FOLIOfn, a new online company at www.FOLIOfn.com, will give investors the benefits of individual stock ownership with the instant diversification of mutual funds.
from The Street.com
(by Ilana Polyak)
March 30, 2000 — FOLIOfn customers will be able to build their own customized portfolios or invest in any of about 75 created by FOLIOfn, which contain 20-50 stocks each. Some replicate the stodgy Dow Jones Industrial Average, while others buy Internet stocks or environmentally friendly companies. Investors will be able to customize these preset baskets of securities at any time.
Nothing itsy-bitsy about stock teenies
(Op-Ed by Steven M.H. Wallman, USA Today)
March 29, 2000 — Investors lose hundreds of millions of dollars a year to a centuries-old Wall Street practice: trading stock in fractions as opposed to decimals. This may seem like a small thing—a penny here and a penny there—but it adds up rapidly, and it comes directly from investors pockets.
Tired of trying to time the market?
Founder of FOLIOfn touts a new way of investing
(by Barbara Costanza, CBS Marketwatch)
March 24, 2000 — Don’t want to pick your own stocks? Annoyed with mutual fund fees? Tired of trying to “time the market?” Steve Wallman, founder, chairman and CEO of FOLIOfn says he’s got a new spin on investing, a customized basket of stocks that an investor can own and control without a huge cost.
How to Pick a Discount Broker
(The Motley Fool’s Ask FoolU)
March 22, 2000 — One brokerage that is offering something slightly different is FOLIOfn. Hard to explain in this small a space, but worth a look.
from Business Week
(by Mike McNamee)
March 20, 2000 — Technology is also helping brokers pioneer creative ways to trade. Former SEC Commissioner Steven M.H. Wallman is launching a brokerage, FOLIOfn, that lets investors buy and sell packages of stocks—a ‘Folio’ of, say, 28 Internet stocks—for one fee.
Investing Without the Frenzy
(by Kimberly Weisul, Interactive Week)
March 10, 2000 — A skeptic might fairly describe FOLIOfn, a new financial services company, as the perfect investment tool for Puritans. The company is setting itself apart by systematically stripping out some of the bells and whistles that have made day-trading so popular. The company is designed around the premise of investing in portfolios of companies, not individual stocks.
Who Wants to Manage a Fund?
(by Megan Barnett, The Industry Standard)
March 6, 2000 — Steven Wallman wants to do to mutual fund managers what online trading did to stockbrokers: Push them to the sidelines. Wallman, a former commissioner for the Securities and Exchange Commission, has taken the wraps off FOLIOfn, the secret—and oddly named—financial-services startup he founded in 1998. The venture has lined up a product that aims to tip over the mutual fund industry’s apple cart: FOLIOInvesting, ready in spring, will let people create and manage their mutual funds online for the first time … FOLIOfn is taking an entirely new approach by charging a yearly subscription fee as low as $250 for an unlimited number of trades. Mutual fund managers find those low fees laughable. “They’re crazy,” says David Kugler, CEO of the Monument Funds Group. “I don’t understand how they’ll make money”… Wallman insists that not having to pay costly portfolio managers will help his bottom line, and that the electronic platform saves costs. “Their business model requires higher fees,” he says. “Ours doesn’t.”
Ex-SEC Whiz to Launch Online Service With a Twist
(by Randall Smith, Wall Street Journal)
March 2, 2000 — A former commissioner of the Securities and Exchange Commission who once was at the forefront of technological change at the agency is making a leap of his own into the New Economy. Steven M.H. Wallman is set to launch a securities firm, FOLIOfn, Inc., that he says will offer an innovative online service allowing customers to invest in groups of stocks in weights that can be preset, or customized according to the investors’ preferences. The new company has more than $75 million in start-up capital from investors led by PSINet Inc., an Internet service provider in Herndon, Va., and Mayfield in Menlo Park, Calif… The service offers the kind of diversification that generally requires holding a dozen or more individual stocks. But unlike a mutual fund that holds a portfolio of stocks chosen by a professional manager, the FOLIOfn portfolios can be adjusted to allow for tax-loss selling, overall risk, or other factors. It would allow investors to skip all tobacco stocks, for example.
Managing your own mutual fund
(by Craig Tolliver, CBS MarketWatch)
March 2, 2000 — A new Web site that launched Thursday virtually allows investors to make and manage their own mutual funds. While full-scale commercial service won’t be available until late April, visitors to FOLIOfn.com can view a demo of the operation. more
The site plans to offer ready-made ‘Folios’ of up to 50 stocks each that address specific sectors of interest to investors, such as an Internet Folio. The investor can then choose to add or delete companies and even change the holdings allocations. Unlike buying and selling stocks individually, through the Folio program investors will be able to buy fractional shares just as they would with a mutual fund. Cost to investors is a flat fee of $250 a year if trades are conducted according to the firm’s twice-a-day time table. Intraday trading can be conducted via the telephone for an additional fee.
“This isn’t about getting people to trade more often, or to buy and sell stocks faster. This is about leveraging the full power of the Internet to help investors invest and trade better, smarter and more easily,” FOLIOfn founder Steven M.H. Wallman said in a statement. “Buying a portfolio tailored to an individual’s preferences has been available only to extremely wealthy investors. Until now.”
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FOLIOfn Launches Net-Based Financial Services
(WashTech.com)
March 2, 2000 — A new company with a different-looking name says it will offer “innovative online financial products and services to benefit individual (and smaller institutional) investors.” FOLIOfn launched its first Net-based offering and announced plans to develop other services at a news conference in New York City. more
FOLIOfn’s first offering, FOLIOInvesting, allows investors to buy and sell entire stock portfolios, known as Folios, with just a few mouse clicks. With FOLIOInvesting, investors choose their risk or other personal investing preferences, then directly invest in whole portfolios that match those preferences, officials said…
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from Netpreneur News
March 2, 2000 — FOLIOfn, Inc. launched with plans to develop an array of Internet-based financial services for individual and smaller institutional investors. The company unveiled its first offering, FOLIOInvesting, a tool that allows investors to buy and sell entire stock portfolios, known as Folios. Investors choose their risk or other personal investing preferences, then directly invest in portfolios that match those preferences. Founder and chairman Steven Wallman is a former Commissioner of the SEC. Backers include PSINet, Mayfield and Jefferson Partners.