He has a way of setting a room at ease when he enters and making everyone feel at home. This warm sense of calm and assuredness has become a hallmark of Hilton Capital team members, something O’Neill personifies. Yet, as much as this comes naturally to O’Neill and his team, it’s no accident. “Hilton prides itself on a high level of service to our customers. As important as it is to be great at managing assets, it’s just as important to understand our customers problems and needs.”
O’Neill came to Hilton Capital officially in March of 2010, but he had known Hilton founder Bill Garvey for several years prior. “Bill started in commodities and had a strong fixed income background,” said O’Neill. “I had a good look at equities throughout my career so we are often on the same page but with complementary skill sets.” The two shared thoughts on the markets for years and had struck up a deep friendship when they began talking about joining forces in 2009. “Hilton was really gaining traction around this time, which was even more impressive considering the state of the markets during the financial crisis.”
By the time O’Neill joined Hilton Capital, he had already spent decades carving out an impressive niche on Wall Street. Twice, in fact. The first chapter of his remarkable career was as a partner of Cohen, Duffy & McGowan, an Equity Options Specialist on the floor of the American Stock Exchange. In just a few short years, O’Neill worked his way from a clerk on the floor to trader, specialist and then partner of the firm. The firm grew to become one of the top option specialists on the AMEX before the partners decided to sell in 2001. “The thing to understand about that time is that we were trading our own money. Every day you went home with 95% of your net worth on the street. It’s amazing how much we take for granted now with the power of computing and automation,” continues O’Neill. “Back then you were making a market on the fly, literally doing the math in your head. And as a specialist you had anywhere between 15 and 150 people in front of you trading while keeping track of hundreds of option markets.” As intense as those years were, O’Neill is grateful for the experience. “I certainly came out of those years battle-tested.”
Being battle-tested would prove to be more important as O’Neill moved into the next chapter of his career. Immediately after selling the firm, destiny would indeed intervene for O’Neill and the rest of the world.
I had brought my daughter to work that day, she was five at the time. I didn’t know it yet but the first plane had already hit and when we came through corridor I realized something was very wrong.”
Having just sold his business, O’Neill was still with the new ownership when the world stood still on September 11, 2001. “We heard the whining of the second plane’s engine then suddenly there was just debris everywhere,” recalls O’Neill. “I carried my daughter in my arms from lower Manhattan and up the east side to my brother’s apartment. It took a while to settle in and figure things out, but you had a sense from the beginning that somehow everything had changed.”
O’Neill spent the next three months working from the exchange in Philadelphia while crews worked to put Wall Street back together. “I continued with the company through 2003 but was feeling the tug of entrepreneurship. Hedge funds were exploding at the time so I worked with a couple of guys I knew in the industry to establish a boutique prime brokerage firm. These were essentially the back office for hedge funds that would clear and settle trades, and provide stock loan, leverage and capital introductions.
“When we started, no one was servicing the lower end of the market. There might have been 2,500 hedge funds when we formed the company, but by 2008 there were literally 12,000 registered hedge funds.” It was during this period that O’Neill approached the Rafferty family to open the Prime Brokerage business under their broker dealer. The Rafferty’s already had a substantial presence in the industry. One of the nascent holdings in their portfolio was a firm known as Hilton Capital.
“Competition was outrageous. There was a feeding frenzy with everyone trying to grab a piece of the hedge fund explosion,” says O’Neill. “We added layers to remain ahead of the curve, such as a traditional sell-side institutional desk.” The business continued to grow even as margins tightened and O’Neill was poised to ride out the competitive storm. But the Rafferty’s, as it turns out, had different plans for O’Neill.
“Larry Rafferty knew he had a winner on his hands with Bill,” explained O’Neill. “They were looking to surround Bill with infrastructure and they thought my experience in building business lines would be a great complement. Hilton already had incredible relationships and Bill’s approach to risk mitigation with a focus on return was rock solid and really winning people over. My job was to build on that trust and create operational room for Hilton to grow so Bill could focus on the core strategy.”
Just prior to O’Neill joining Hilton, the firm made another All-Star acquisition. Literally. Hall of Fame New York Islanders legend Clark Gillies joined Hilton and investment in Hilton’s core strategy began to soar. “All of the pieces were coming together at a time there was still so much concern and mistrust in the markets. But probably the most important move in those early days was finding Alex.” Alexander Oxenham who is now a partner and co-chief investment officer of Hilton Capital. Prior to Hilton he was a senior portfolio manager at HSBC Private Bank. “Alex was a tremendous addition for us because it allowed us to build some depth on our bench and demonstrate growth to our investors as well. From there it’s all been about building scale and operational capacity to allow our investment team space and time to maneuver.
“My goal is to increase distribution through marketing, strengthening the sales force and treating the advisor community with gold standard service. When you think about the broader investment marketplace, you know there’s a fundamental aversion to risk but also a need for income. That’s what makes Bill’s concept so appealing.
“So the job is to introduce it to as many institutions and as many advisors as possible. There’s a very real argument to be made that Hilton’s core Tactical Income Strategy should be part of every portfolio, period. The key is to continue providing the same high touch service that our clients have enjoyed for years and maintain our internal culture.”