Excellent speakers are not just feeding you with information, summaries or answers, they open your mind, stimulate your intellectual curiosity and teach you methodologies, so that you are well equipped and motivated to search for the answers yourself.
I am grateful for CFA UK society as it has kept me plugged in on what's going on in the City. My job was to run investment portfolios for private clients from one of London's wealthy suburbs, you could argue that in a digital world with the wonderful Bloomberg terminal, portfolio managers don't need to be physically in the heart of the financial centre to do their job. You will get the Bank of England announcements simultaneously whether you are next to the Bank of England or in a boat on the Grand Union Canal - well, not a typical office place for a portfolio manager but you get the point. Having said this, CFA UK offer a platform for people to connect, voice their opinions, and possibly find people to do business with. The people there come from various background, with diverse work experience, different views and goals in life. Endurance is the only thing in common considering everyone has gone through or going through the pain of the CFA programme. Everyone I met gave me a bit of inspirations in the work I do or the life I lead. All I needed to do is to hop on the tube to the City and meet these people, at no cost! To me, this is priceless.One recent event organised by the society was of top quality. It had a rather plain vanilla heading - Succeeding in the Changing Investment Profession, but was packed with brilliant speakers and topics. What are the challenges in this changing world for investment professionals? I would think that the obvious ones are regulations and low rate of returns. These, among other things, have made banks and wealth managers remodel their businesses. For example, due to the higher capital requirements posed by central banks after the financial crisis, investment banks have retreated from certain businesses that are too expensive to operate. On the other hand, the low rate environment also made low-cost passive investing look attractive to investors, and encouraged a lot of new product innovations.
Rather than making this event resemble more of a compliance and regulation briefing, our key note speaker, Peter Harrison, head of investment at Schroders, led us to see the bigger trends: 1) client fragmentations 2) specialisation 3) digital era 4) aging in investment decision makers 5) globalisation.
The first one was driven by the demand of more bespoke services and to some extent by the retreat of certain client services by investment banks. As a result, wealth management boutiques have prospered in the city over the last couple of decades. Peter thinks this may well continue. The second observation is actually a worry of his in that young investment professionals are made to be too specialised too early in their careers. This may hinder the progress to a more general role in management or executives. Whilst this phenomenon is rather difficult to change, he encourages us to take some risks, seize opportunities to get more general experience and be a little more entrepreneurial. The third one is a topic echoed a few times in this event, which I frankly didn't give too much thoughts on previously. Our industry has grown to be very technical indeed. We probably have the most sophisticated mathematical models, computer programme, and managed to lure a good number of physics PhDs away from their own profession. In fact, Peter is talking about utilising data and network to analyse patterns, drive investment performance, solve problems, and drive sales. Like many other industries, we should also be searching ways to use big data and social media. I am fascinated by this topic although not much clue in the practicalities. The fourth one is Peter's observation that people are generally given decision making responsibilities later and later in their careers. With age usually comes experience. But the ability to innovate are not necessarily linked to age. I actually see values in both young and old. In fact, I quite like a team of more experienced with less experienced, male and female, English and French... must be a very stimulating place! The fifth one is to encourage young professionals to gain knowledge and exposure in different countries as there is an increasing demand from clients for global solutions.
So I think these 5 points really talked about opportunities and how you could take a slightly different viewpoint and seize them. There will always be changes. The reasons why you were successful in the past may not be the reasons why you continue to be so. Particularly in investment, it is almost impossible to have consistent success without any failure. Therefore, to be mindful of new challenges and be resilient in case of any misstep are the key to a respectable career.
All the speakers of the event shares their reasons to chose and stay in their careers, their tips and philosophies, and their moments of setbacks, with honesty. Poppy Allonby of BlackRock chose energy research in 2000 against all odds (including a decade of oil price bear market), because she had tremendous respects for the investment manager and the team. Alexandra Haggard of Russell Investments urged young professionals to not only get a broad understanding of economic issues but also be prepared to go deep into the granularities. So when problems need to be solved, you are able to pull it off. James Waterworth of Lyxor was made redundant in his first job during the financial crisis. He decided to recharge himself by doing a master in applied finance. Looking back, he thought that being fired was probably the best thing ever happened.
The event was concluded by a rather unexpected guest speaker, a neuroscientist. Dr. Tara Swart, founder of The Unlimited Mind, gave us a brief introduction on how neuroscience can be applied to work. Until she pointed out, I haven't thought about taking care of or exercising my brain. If you think this is irrelevant, like I did initially, then ask yourself if you feel comfortable making big decisions when you are sleepy or stressed. Investment decisions, in my mind, are the result of data analysis, inductive reasoning and a bit of gut feeling. A complex process as it is, we want to stay sharp rather than having decision fatigues. I recommend you read her blogs to get one or two practical ideas.
So really how to succeed in the changing investment profession? Try this recipe - to see changes as opportunities, be adaptive, be resilient, be a bit more creative, and apply a few neuroscience techniques. This may well be a recipe for success in any profession :)
Enjoy June!
