After 35 years of stockbroking for some of the biggest houses and investors in Australia and the UK, the Secret Broker is regaling Stockhead readers with his colourful war stories — from the trading floor to the dealer’s desk.
 

A death in the family is always a sad event, especially if there is money involved in the estate, as this human tragedy seems to bring out the worst in families.

I can feel you all nodding as I write about how all these related people appear, hands out, cap in hand and just before the burial period.

If they are not entitled to any cash, then they won’t hang around for a house to be sold or investments to be liquidated. They’ll collect the odd possession before scurrying back to whence they came.

One of my jobs in my early days was to prepare a now deceased client’s list of stock investments held for probate, for which a fee of 1% was charged on the final valuation (by our firm) for something that may have taken me five minutes to prepare.

If we later had instructions to liquidate those assets, new accounts had to be opened and all liquidated funds would be sent, via a cheque, to the deceased’s acting solicitor.

Everything had to be done in a professional and legal manner, so as to make sure there was never a comeback on us and the way that we conducted ourselves during the liquidation period.

A letter of explanation was always sent with the cheque attached, especially if there were some illiquid assets.
 

Game, set, match

One of the best ones that I came across, was a Wimbledon Tennis Club debenture, which we had to offer back to the Wimbledon Tennis Club for a bid.

These debentures are claimed to be the most desirable sporting tickets in the world. They’re sold every five years and the last lot went in 2019 for about £100,000 each.

Five years of Centre Court hobnobbing with royalty and celebrities. Some even watch the tennis.

When their last and final bid came in, the partner I was acting for was happy to accept this bid on behalf of the deceased’s estate, until I pointed out to him what dividends were attached to said debenture.

They paid out a dividend of two tickets to centre court for every day that Wimbledon was on for, including the men’s final.

He looked at me and got out his cheque book and wrote out a cheque for £1.00 more than the tennis club’s final bid was and sent me on my way.

I then had to instruct Wimbledon to register the debenture into our firm’s nominee account and explain in my letter to the acting solicitor that I was actually able to sell the debenture for a higher price than the tennis club was prepared to buy them back at.

I didn’t say by how much and I was kicking myself for not being allowed to buy them myself, as everything had to be done at arm’s length, but I admired how the partner bought them for the firm and not himself.

Every year that senior partner would poke his head around the door of the nominee department, a month ahead of Wimbledon starting, and ask if a certain dividend had yet arrived.

If it had, an envelope stuffed full of crisp tickets to centre court were handed over and this was the only time that the senior partner would ever venture personally downstairs and not send Miss Penelope, his trusted PA.

He could not even trust her with this envelope full of Willy Wonka golden centre court tickets.

And no, I never got invited even, though without me none of this could ever have happened.
 

I’m still standing!

So, handling the funds involved in an estate is always a delicate operation and it is why auction houses exist today.

If there are family members squabbling over a prized possession, then put it to auction. No one can argue over the item’s value and if some deranged relative does, then they could have bid for it themselves.

In England, auction houses can be traced back to the 1700s, with Sotheby’s being founded in 1744 and Christie’s founded in 1766.

Both famous names are still in the auction scene even today and mainly thanks to all of you lot that keep dying – and also the fact that they collect a 15% commission from the buyer!

I was lucky enough to be around in London when Elton John decided to have a garage sale, via Sotheby’s in 1988. It went for four days.

I managed to get to the last day and bid on some original cartoon drawings from the Beatles Yellow Submarine cartoon movie plus get my hands on a pair of his outrageous glasses.

The reason I went on the last day was because you could make an offer on items that had been passed in.

Not many people know about this auction hack but it was something I learnt from an old partner, when they made me go and collect some of the items they had brought in the famous ‘Hatcher Cargo’ auction in 1984, held via Christies.

The auction was for 25,000 pieces of Chinese porcelain that Captain Hatcher had recovered from the shipwrecked Nanking cargo ship which sank in 1752.

I had to catch a taxi to Christie’s in London to pick up said items, as the auction had been held in Holland.

When they had sent me round to the collection room, next to the box I needed to pick up was another one, with some red tape and the word ‘cancelled’ written across it.

I asked the chap what this box was and he explained that the purchaser had bid but not paid, so it was being held back pending an offer.

I knew what the partner had paid for his items, as I had the receipt in my hand. The chap explained to me how passed in items and unpaid for items could have offers made on them, so I made a cheeky offer for the other box.

He disappeared and came back with a firm ‘no’ as it was too low, so this one got away but as Elton had over 2,000 items, I knew I could make offers on passed-in items on the last day.

And that is how I now own a pair of Elton’s glasses, which make appearances at dinner parties, after I tell everyone about them.

Mrs B hates them but I love them, though she does love the hand-drawn cartoon slides from the yellow submarine movie.

They were put on the walls of the kids’ bedrooms when they were little, whereas Elton’s glasses were put in a bottom drawer somewhere.

If only I had made a higher bid on the unpaid for box, we could have had something more than Elton’s eccentric junk and something that could be put in the safe because it has real value.

Bit like a dodgy share portfolio, where you let the good ones slip through your hands, whilst the cheap gaudy rubbish ones you keep, hoping that one day, just one day, they will turn into something of real value.

I wonder who will be fighting over Elton’s goggles when I go?

That’s right. The rellos with no taste!

 

The Secret Broker can be found on Twitter here @SecretBrokerAU or on email at [email protected].

Feel free to contact him with your best stock tips and ideas.