
                         Roanoke Times
                 Copyright (c) 1995, Landmark Communications, Inc.

DATE: SATURDAY, August 27, 1994                   TAG: 9408300010
SECTION: BUSINESS                    PAGE: A-6   EDITION: METRO 
SOURCE: By SUZY HAGSTROM ORLANDO SENTINEL
DATELINE:                                 LENGTH: Medium

BROKERS TAKING STOCK

RECORD INCOMES enjoyed by the nation's stockbrokers are a thing of the past because the markets have eroded their pay.

They celebrated 1993 with caviar and champagne. In 1994, they are eating pretzels and drinking beer.

Many of the nation's stockbrokers are economizing as declining markets erode their pay - a sharp contrast to the record income they enjoyed last year.

The Securities Industry Association's recently released annual survey of brokers' compensation already is outdated, said Jeffrey M. Schaefer, senior vice president of research at the trade group's New York headquarters.

Schaefer said he didn't expect brokers this year to reach 1993's record gross commissions of $225,000 and record take-home pay before taxes of $90,000. Take-home pay is what brokers keep after brokerages get their share. The figures are medians, meaning that half the brokers earn more, and the other half earn less.

``If you look back at 1993, it was one of the better years for investors and the industry,'' Schaefer said, describing a scenario of falling interest rates, heavy trading and rising stock and bond prices.

``The world is very different in '94,'' Schaefer said. ``It's the first time in three years plus where we've seen a decrease in the value of bond funds, stock funds and funds that combine the two.''

As interest rates plunged to historic low points during 1993, people converted cash holdings, such as certificates of deposit and Treasury bills, into stock and bond investments yielding higher returns. Stockbrokers profited from that massive movement of money.

Now that the bond market has crashed and stock prices have deteriorated, investors seem paralyzed, said Richard A. Eckstein, a broker for Corporate Securities Corp. in Altamonte Springs, Fla.

Many brokerage customers, retirees in particular, use their returns to make more investments, Eckstein said. That source of business has dried up, he said, because clients are suffering losses and retirees are tapping into principal to pay living expenses.

Eckstein estimated that he is making about 30 percent less this year, but much of that drop was caused by his switching employers, he said. Echoing other brokers, including Nolte, Eckstein said he was concentrating on finding new clients, selling annuities and insurance products, working longer hours and taking fewer vacations.

by CNB