Compass Turns 25


In 1997 Bill and Carolyn founded Compass.  After a combined 23 years with major brokerage firms, they wanted something better; better technology, less bureaucracy, lower expenses and most importantly, the ability to focus on clients instead of the firm.   

It’s hard to believe it now, but not long before Compass started, major brokerage firms had a monopoly on stock and bond trading.   You couldn’t even get real time pricing away from a broker’s terminal unit.  The Internet changed everything. 

For brokerage firms the Internet revolution meant that simple, proprietary Quotron and Telerate machines were being replaced by PCs and Bloomberg terminals that anybody could have.  Deregulation meant you no longer had to be a member of the New York Stock Exchange or be a primary dealer to trade stocks and bonds.  Discount brokers were leading the financial revolution and financial news was going from one show on Sunday night to whole networks devoted to business news.   

In 1995 the Matthes’ were in the first group of brokers at Paine Webber who transitioned from being brokers to acting as investment advisors, eliminating commissions, and becoming fiduciaries.  They and their clients embraced the change, but it didn’t change their investment style, which continued to focus on stocks and bonds instead of packaged products and outside managers. 

With the Internet and dawn of the investment advisor, the stage was set for Compass.  The hometown office space was a former toy store in Guilford.  A brass compass from an antique store seemed like a good logo.   Carolyn’s stepmom was their first assistant.  They bought their own Bloomberg machine.  In March they were ready to open shop, hoping their clients would come along and new ones would be attracted to what at the time was a rather unique business model. 

It worked!   It didn’t hurt that the stock market was on a record winning streak that would not come to an end for three more years.   Even then they were value managers intent on avoiding manias and the current mania was large cap growth stocks, or “Ruler stocks”, because their earnings could be drawn in a straight line up.    

Compass was skeptical.  So skeptical they devoted one of the first newsletters to three stocks they thought were guilty of financial engineering: Tyco, Enron and GE.  Three stocks that everybody loved but seemed too good to be true.   Not owning these gems hurt for a while, as did an inability to get excited about, but it served our clients well in the 2000 to 2003 corrections. 

Then the fun began as Compass exercised our next law of investing: buy panics.  Being underweight technology and big growth going into the correction allowed fir buying great companies at pennies on the dollar, many of which our clients still hold today.  The recovery of 2004 to 2008 ended in the great financial crisis which was made more terrifying because almost nobody saw it coming.  Everybody knew that some lenders were overextended, but who knew that nearly every major bank in the world was leveraged 30 to 1 instead of their reported 10 to 1 and all owned the same rotten mortgages.   

Still, if the lesson learned from the great financial crisis was that you couldn’t trust anyone and that the world was going to hell, you missed the boat.  In fact, you missed the longest and best bull market in history.   2009 to 2020 should be known as the great compounder of wealth as the market soared 400% in eleven years, perfectly timed to coincide with the first class of baby boomers entering their retirement years.   

Flash forward…

One of our great joys is reviewing portfolios now that we managed during these years and seeing most of the accounts consist of unrealized capital gains because we were able to buy great companies at bargain prices.  Just as important, we can hold them because they are still great investments ten or twenty years later.   That is how you compound wealth. 

Beginning in about 2012, when Bill turned 65, Compass began to think about succession.   The logical solution was to merge with another firm of which there are hundreds, maybe thousands, who would happily offer a home to our clients, but none of them felt like the right fit.   From an investment standpoint, most advisors no longer manage their own clients’ stock and bond portfolios.   They use mutual funds or outside managers or model portfolios that are supposed to make things easier for the advisor, not necessarily better for the client.    

Some advisors do this well, but for our clients it would expose taxable accounts to massive capital gains as they converted to the new model.  We also strongly believe in the value of owning actual bonds that have maturities instead of funds and commingled investments. In addition, we found that managers using individual securities generally charge a lot more than we did or had much higher minimums.   So much for the promised efficiency of greater size. Lastly, it was imperative that we protected our most coveted asset, our people, and that Lisa and Marilyn would remain an important part of Compass.

Fortunately, the solution to our problem was right under our noses, or in this case, in our book.  Jason Bear had been our client since birth when his grandfather set up an account for him, he had the right experience with Royal Bank of Scotland and Mizuho, was a Certified Financial Analyst and, for the right opportunity, could be lured out of Wall Street and on to Main Street in Guilford.   

We devised a gradual transfer of ownership as Jason’s responsibilities increased but more importantly, we were able to grow much faster with an injection of youthful energy and an ability to manage more accounts.   To coincide with our average employee age dropping, we took advantage of Jason’s technological orientation to upgrade our client systems, allowing us to gain greater efficiencies. 

As we grew over the past few years, we asked ourselves what we could do better.  The answer: provide our clients more comprehensive financial planning.  As the world becomes more complicated, we wanted to help our clients navigate things like social security, Medicare, complex estates, and tax planning.  Enter Radford Brogden, who spent his career at big firms but wanted to do it better.  Now we offer our clients unbiased, world class financial planning with no gimmicks, no sales hooks, customizable to their needs, and all for a reasonable cost. 

Compass Wealth Management

To emphasize the continuation of our journey as a firm we are updating our name from Compass Asset Management to Compass Wealth Management.  Our goal is to help clients with all their financial needs.  This will involve a new website,, with a fresh new look, and new email addresses (  Don’t worry, our old emails and website url will still get you to the right place.  In addition, we crafted a new logo and continue upgrading our internal processes to ensure we serve our clients the right way.

Rest assured, a name change only strengthens our conviction in what got Compass this far over the last 25 years. We chose to remain independent as we believe it allows us to best service our clients for the coming decades.  Our continued commitment to you:

  • Clients will always come first.  Our decision making will be driven by what’s best for the client, not what’s best for somebody else’s pocketbook. 
  • We will remain staunchly independent in our thinking.  Confident to be different when the media and the market tell us otherwise.
  • We are investors.  Market’s change, but the ability to understand trends, business models, and market sentiment remain crucial to our long-term process.
  • We seek to provide the best personal service in the business, with employees you enjoy speaking with and that provide confidence in our ability to execute. 

The next 25 years should be just as interesting.  Earlier this year we wrote an important newsletter “The Times They Are Changing” indicating that the economic and social conditions that have defined markets the last two decades are unlikely to continue.  Low inflation and negative real interest rates that fueled the economy are ending.   The world order where developing countries remained passive beneficiaries of our trade is becoming much more challenging.  Domestically the country is so divided it is challenging our most precious resource, the rule of law.    

Scary stuff, but no worse than when Paul Volcker drove short term interest rates to 18% or when we found out that every major bank in the world was functionally bankrupt because they were awash in bad mortgage derivatives.  We’ve been a country divided many times in our short history. Remember the race riots of the seventies and the Vietnam war?  We lived through it and more.  So will the next generation. 

So, thank you for taking all or part of this journey with us.   Thanks to the wonderful people we have had the honor of working for and with.   It has been a blessing for all of us to be able to do this for a living.  We look forward to next 25 years with more optimism than ever.

Your Compass Family,

Jason, Rad, Bill, Carolyn, Lisa, Marilyn 

Compass Wealth Management LLC is a SEC registered investment advisor, clearing transactions primarily through Pershing Advisor Solutions and Pershing LLC subsidiaries of Bank of New York Mellon Corp. This letter is written by Compass for the benefit of its clients and does not necessarily represent the opinions of its affiliated organizations. It is based on information believed to be reliable, but which is not guaranteed to be correct. Nothing herein shall be construed to be a solicitation to buy or sell securities, indicate that past performance is predictive of future returns, or recommend individual investments.

Contact Compass


(203) 453-7000