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As 2009 draws to a close, it seems that clients of top advisors have almost regained the money they lost in 2008. Toss in the wisdom they hopefully won in the process and their outlooks are brightening. At least that's the feeling that comes across in our third annual 40-Under-40.

As you read these profiles, you'll feel their optimism. The hallmark of good salesmanship, possibly, but there is a distinct feeling that future historians will look back at us and wonder what the fuss was about. While a good many prognosticators proclaimed asset allocation dead—On Wall Street was not above an article or two on the topic—many of these advisors assured clients to stay on course with their portfolios. And now they report that many of them are back to 2007 asset levels and looking to take on more risk. (At least one advisor says his clients are taking on too much risk.)

To compile our list, we asked the reps' firms to identify their advisors, under the age of 40, with the most assets under management custodied at their firm. We separated each advisor's assets from their team's and ranked them accordingly. We also included their trailing-12 production. Of the final group, 39 came from big firms, so we've added a list of the top regional players.

Read all about their career experiences, their strategies and their tips to other advisors. Read about the one who played minor league baseball, or the one who advises Native American tribes, or the team who says their clients actually don't want face time. They're all here, just turn the page.

1

James Odurczuk, 36

Ross Dolgoff, 39

Bear Stearns/JPMorgan Boston

$1.2 billion in assets each

Bear Stearns partners Ross Dolgoff and James Odurczuk spent most of the weekend March 15-16 last year talking on the phone. As Bear Stearns teetered on the edge of insolvency (and Dolgoff was away celebrating his anniversary), the two wondered if the office lights would be on the following Monday. Even in a worst case scenario, the pair figured they ultimately would be safe. They oversee the accounts of 50 wealthy families with a typical account size of $10 million to $15 million, and would be attractive candidates for competing firms. Still, Odurczuk acknowledges the relief they felt when news broke on Sunday that JPMorgan was going to buy them. "Two dollars never looked so good," he says, referring to the per-share price of the deal.

So it was back to work—at the same desks no less—with a whole host of new worries. Market unease in the spring and summer led to all-out panic in the fall, and the pair began to question the effectiveness of traditional asset allocation. They wanted more flexibility and control of their clients' accounts. First step: Cut back on their use of outside money managers. "When brokers outsource, they tend to 'set and forget' and it's hard to be practical," Dolgoff says. "But when you look at a client's portfolio everyday and know everything they own, you don't take your eye off the ball." Now, they say they're free to move client assets wherever necessary—and to go to cash when it's the best option. The pair says it has been a big selling point in meeting new clients looking for a different approach. "It's a huge differentiator for us," says Odurczuk. "And it forces us to be at the forefront and be more accountable."

Odurczuk and Dolgoff are both graduates of the famously competitive Lehman Brothers training program and agree it prepared them for the realities of the business. Dolgoff, a West Point graduate and former captain in the army, says his military training has also proved useful. In both fields "you need to organize, prioritize and be persistent," he says.

3

Derek Johnston, 37

Merrill Lynch // Tulsa, Okla.

$1.133 billion in assets

After graduating from college, Derek Johnston knew he wanted to be a financial advisor. But it didn't take him long to realize that cold calling wasn't his forte. "I'm really a soft-sell guy," he says. So he worked hard to get in front of people and put his knowledge on display by letting them quiz him.

It worked. Today Johnston oversees 50 ultra-high-net-worth clients in Tulsa and also runs an equity compensation program for a Fortune 500 company. He advises the executives about managing risk in the other parts of their portfolio and arranging loans while their wealth is tied up in company stock. And when it comes time to sell stock, Johnston helps clients diversify while minimizing taxes. Clients can be reluctant to sell, though, as many were original founders of the company. "They built it from scratch and believe in what they're doing," he says. "With that in mind, my job is managing their risk."