With an investment career that spans close to 45 years, Mary Ellen Stanek (’84 MBA) has experienced first-hand the ups and downs of the economy and has been an innovator in leveraging bond markets for more balanced portfolios.
When she entered the field in 1979, she was dubbed one of the “bear market babies” in her entry-level position at First Wisconsin Trust. There was the stock market crash of 1987. The uncertainties of the post-9/11 era. The 2007-08 financial crisis and the ensuing decade to rectify what led to it. The 2020 pandemic-related economic shutdown. And now, the challenges of emerging from what was, we hope, a once-in-a-lifetime occurrence.
Today, Stanek is Founder, Co-Chief Investment Officer, and Managing Director of Baird Advisors, and President of Baird Funds. She is responsible for the formulation of fixed income strategy as well as the development and implementation of all fixed income asset management services.
Her prowess in the management of fixed income portfolios is widely known and internationally regarded, including recognition as Morningstar’s 2022 Outstanding Portfolio Manager. She calls the accolade “a pinnacle award career-wise and an incredible honor for our team.”
Ironically, her expansive knowledge in the fixed income arena was initially developed in an “other duties as assigned” project at her first job at First Wisconsin Trust. In addition to her primary duties, she was asked to research the concept of duration. Duration is the refined measurement of risk in an individual bond or bond portfolio.
“Of course now it’s a mainstream concept in the management of bond portfolios,” she says. “But in those days, it was primarily discussed in actuarial science, not in practice.”
Her research played an important role in a pioneering technique that the company developed to manage bond portfolios, particularly for pension clients.
She must have made quite the impression, because four years into her career – at the age of 27 – Stanek was given the top job in fixed income when the prior director left. At the time, she was close to becoming a CFA and about a year away from earning her Lubar MBA.
“I became a leader at a young age, but I realized I didn’t have all of the answers or the experience,” she says. “I knew I needed to build a team and we needed to do it together.” It’s a leadership philosophy she adheres to today.
That team included Gary Elfe and Charlie Groeschell – also Lubar MBA grads, but from different graduating classes. To this day, Stanek considers them like brothers. “We literally grew up together, professionally.” (Groeschell is a Managing Director at Baird Advisors. Elfe passed away in 2020 after a long and successful career with the team.)
The business they began was tiny compared to today, she says. But it grew steadily, and she was promoted to President & CEO of Firstar Investment Research and Management Company.
Then in 2000, Stanek, Elfe, and Groeschell founded Baird Advisors, which now manages over $120 billion in assets. Employee-owned parent company Robert W. Baird & Co., Inc. is an international financial services firm with more than $375 billion in client assets. It has been recognized among the Fortune 100 Best Companies to Work For for 20 straight years.
Her thoughts on today’s bond markets?
“With interest rates rising dramatically, bond yields are much more attractive for investors,” she says. “This is true nominally and relative to other asset classes.”
As far as Federal Reserve action on interest rates, Stanek believes that the Fed will keep short interest rates high for quite a while longer to keep inflationary expectations in check, avoiding the mistake the Fed made in the 1970s when they eased to soon and further destabilized the economy.
“From the investor vantage point, the good news is that bond investors will earn higher yields for a longer period of time.”
In addition to her roles at Baird, Stanek currently serves on the board of directors for Baird Financial Group and WEC Energy Group. She is the past co-chair of the M7 regional economic development partnership, and was elected as board chair of Milwaukee World Festival Inc. in March. Stanek is also heavily involved in numerous non-profit organizations, focused primarily on causes related to children and education.