Money management firm loses 35; alumni help it rebuild
By Michael Luo, Associated Press
MORRISTOWN, N.J. — Sometimes, in a slow moment, Joe Maida's thoughts will wander, and he'll think of the friends he lost. His eyes will drop from his four computer screens that monitor stock prices and portfolio valuations and fall on the prayer cards poking out of his keyboard.
Some are adorned with photos; others contain just a Bible verse. Maida collected them from the 15 or so funerals he's attended since Sept. 11.
"It helps," he said. "It's kind of nice to keep their faces in front of me."
He usually doesn't have time to dwell. The phone will ring, or a trade order will come across, and he's back to the bustle of his day, barking orders, haggling, cajoling.
"The market doesn't give you time to grieve," he said.
Fred Alger Management Inc. lost all 35 people who were in their offices on the 93rd floor of One World Trade on Sept. 11. Maida, the director of equity trading, was among 20 employees who happened to be running late or were otherwise out of the office that day and survived.
It is difficult to overstate the loss for this money management firm. All but five people on Alger's 30-person investment team, which guided its $16 billion in client money, perished.
Among the dead: company president David Alger; four out of five portfolio managers; eight out of 11 securities analysts; all eight research associates. On the trading desk, four out of five of Maida's fellow traders died.
As one employee put it, "80 percent of our brainpower was lost."
Over the last few months, the firm has been rebuilt and revamped. Founder Fred Alger, 66, one of Wall Street's most celebrated investors, returned from semi-retirement in Switzerland to take the company's reins, even as he mourned his brother David's death. Dan Chung, the lone surviving portfolio manager and Fred Alger's son-in-law, was promoted to chief investment officer.
Former Alger employees quit their jobs and rushed back to help. They joined the survivors and the new hires, working out of an Alger backup location in Morristown, N.J.
Together, they are on a mission to honor their dead — by carrying on.
It is hard, though. There are no manuals on how to do this, working and grieving.
"You want to do the best you can to keep their memory alive," Maida said. "If the firm just went out of business — we all scattered and went our own ways — what would happen to them?"
Compared with the most talked about firms in the trade center that lost hundreds of people, Alger is a small company. About 160 back-office employees worked in Jersey City, N.J., but the close-knit trade center staff was the heart of the company.
Alger has long stood out as a training ground for young analysts, a financial boot camp, in which graduates from top schools were taught the "Alger Way." Alger alumni have gone on to other firms and stardom in an industry in which stockpickers are like ace pitchers, anchoring franchises.
With its emphasis on growth stocks, Alger thrived in the 1990s. Its tech-heavy Spectra Fund was one of the decade's best performers. David Alger was voted "The Decade's Best Fund Manager" by SmartMoney magazine.
The 56-year-old Alger was a demanding taskmaster, notorious for his tantrums. An analyst had 15 minutes to sell him on a stock before he lost interest. Analysts dreaded Monday morning meetings, in which the staff was grilled on the previous week's mistakes.
Some employees found David Alger's volatility impossible and left. Many who stayed developed an affection for him, like a tough coach you grow to love.
Still, even before Sept. 11, a subtle change was coming over the firm, survivors said. It was growing friendlier, more close-knit, more "like a family."
"It wasn't like this when I started," said Nam Hoang, one of three surviving analysts, who joined four years ago. "It was just recently."
Much of the credit for the evolution went to Selai Khoo, 38, one of the portfolio managers. With Alger gone for much of the last year, marketing the firm across the country, Khoo brought a different touch. Dubbed the "Queen Bee," she was demanding, but she also eagerly chatted up analysts on their personal lives.
In the male-dominated environment, the women developed a special bond. Sara Manley, a senior telecom analyst, got married in August. Ginger Risco, another analyst and a 15-year Alger veteran, threw a bridal shower. Risco, Janice Ashley and Cat Macrae, research associates, traveled to North Carolina for the wedding.
As for the men, they had sports. A group flew to Chicago in August to play basketball against another money management firm. After losing the year before, David Alger had vowed revenge. But even with Tyler Ugolyn, a former guard at Columbia, Alger lost by nine. They resolved to join a local league; the season had just started.
Many of the young people at the firm socialized together, grabbing a beer or a bite to eat. There was Meredith Whalen, who regaled co-workers with accounts of her nights out; Avnish Patel, a travel fanatic who had visited 20 to 30 countries; Johanna Sigmund, so nice that she was perfect to handle the retirement account of a group of nuns.
Recently, the market had been tough, pummeling Alger's portfolios. Everyone had been working longer hours and commiserating.
Four days before Sept. 11, a group of Alger employees walked to Hoang's apartment for a dinner party.
On Hoang's 44th-floor terrace, Whalen, Ashley and Greg Wachtler, another research associate, sipped wine, chatted and laughed. The view was breathtaking: the Statue of Liberty, the Verrazano Bridge. To the left, the World Trade Center.
Inside, others mingled. Hoang played her grand piano. Andy Kim, a youth group leader at his church, clowned with Hoang's 5-year-old son, Egan.
All agreed they should do this more often. An annual event, suggested Ed Pykon, the senior health-care analyst. A potluck, said Lisa Gregg, a portfolio manager.
Fourteen people from Alger gathered that night. Four days later, all but three were dead.
'We didn't find anyone'
On Sept. 11, most employees were in by 8 a.m. Recovered e-mails hint at the activity in the office. Two guys bragged about winning a football pool. An executive made travel plans. Peter Frank, an analyst, e-mailed the groomsmen for his October wedding, reminding them to get measured for their tuxedos. The time: 8:41 a.m.
Hoang was late. She was supposed to get in early to talk to Khoo about a stock, but her son wouldn't get out of bed. She, her husband and her son finally set out in a cab. Usually, Hoang got out first, because the trade center was along the way to Egan's school. This time, she decided to drop off Egan herself and walk back to the office. So, "I was super late, not just late."
When she got to the trade center lobby, she realized she'd forgotten her company ID. She stopped at the front desk. Suddenly, the building shook.
Maida was heading for the elevators in the lobby. He had run into traffic while dropping off dry cleaning. At the muted sound of the explosion, he rushed outside amid a snowstorm of debris.
The plane scored nearly a direct hit on Alger's offices. Several workers managed to make short calls to their spouses, perhaps from offices on the western side, telling them they were leaving. But nothing more was heard from them.
Patrick Kelly, 26, an analyst, watched the horror on a hotel TV in Laguna Beach, Calif., where he was attending a technology conference. He tried to call in. "Of course, I couldn't get through."
He remembered that Dan Chung was supposed to attend an analysts' meeting in midtown that morning. Kelly nervously dialed Chung's wife, hoping his boss hadn't stopped at the office.
Chung had gone to the meeting. He watched on a giant screen, broadcasting CNN, as his building collapsed.
In the evening, he started making the rounds at hospitals. Hoang and others joined the next day.
"We didn't find anyone," Chung said.
Picking up the pieces
On Thursday, some people wandered into the offices in Morristown. When Fred Alger had ordered the office built several years before, many found the idea bizarre. Alger, though, was worried about terrorism.
It was an emotional reunion for the survivors. Chung, Fred Alger and Maida were there to comfort people.
Chung called up some of his counterparts' portfolios on his computer. Seeing the notes materialize on his screen, grief swept over him. He looked at charts by Ron Tartaro, a fellow portfolio manager. He read a memo from Risco, the retail analyst.
"It was like looking at someone's unfinished portrait or someone's unfinished novel," he said.
After the markets opened, several jittery institutional clients pulled their accounts from Alger's mutual funds. In all, about $1 billion was withdrawn.
But for the most part, clients held on.
The survivors on the investment team had to quickly familiarize themselves with business sectors once covered by their dead colleagues: health care, telecom, retail and other areas.
They slogged through 14-hour days together, then, on weekends, they dragged themselves to memorial services.
The return of the alumni boosted morale. They were greeted as returning heroes. Dave Hyun, a firm star who had left 15 months earlier for Oppenheimer Funds, was the first, deciding it was his mission to pass on what he learned from his mentors, now dead, to the new hires.
"I feel like I'm guarding the holy trust here in terms of culture and process," said Hyun, who was named executive vice president.
Teresa McRoberts, another alum, was a partner in a hedge fund in Midtown. When she saw the planes crash into the trade center on TV, she started to cry.
"I didn't know how to not help out," she said. "All the people who left families will be taken care of better if the firm does well."
Firm officials decline to discuss details of their arrangements with the families. A foundation has been set up to help with short- and long-term needs.
Relations with the family members have not gone completely smoothly, however. Some relatives expressed anger at what they saw as the company's callous focus on rebuilding. The complaints deeply pained those still at the firm, although they said they understood.
There are little reminders of people everywhere.
Fred Alger keeps pictures of his brother, David, and his longtime assistant, Dolores Costa, on his desk.
McRoberts has to refer to old notes by Ed Pykon, whom she hired.
McRoberts' mail piles up. The woman who used to sort it, Dorothy Chiarchario, is also gone.
Evaluating his portfolios, Chung said he constantly finds himself wondering, "What would Ron do? What questions would Selai ask?"
The office is quieter. Missing from the trading desk is the banter that Artie Simon, a trader for 20 years, brought every Monday about football. The pool he used to run has been disbanded.
The firm held a company-wide service last month. Fred Alger described what each person did, how each was a piece of the puzzle.
The firm has so far delivered, comfortably outperforming the S&P 500 since Sept. 11. Investors are returning. Outside observers credit the firm with a remarkable rebuilding.
"It's really just unusual on Wall Street to do what they've done, especially in such a short amount of time," said Mike Trudel, vice president of mutual fund research at Merrill Lynch.
For the holidays this year, the company decided against the usual formal dinner for employees and spouses in favor of an evening at a science museum. Children were invited.
Midway through the evening, Fred Alger convened employees in the Imax theater. He told them how proud he was of them. They gave him a standing ovation. Some had tears in their eyes.
Afterward, Hoang and Kelly shared a car back to the city. When they arrived at her apartment in Battery Park, she invited him up for a few minutes.
Hoang recently hung an American flag from the railing of her terrace. They stood there, just like the night when everyone was together. They looked out at where the towers once stood. They missed them.
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