Speaker 1: Bloomberg Audio Studios, podcasts, radio news. This is Masters in
Speaker 1: Business with Barry Ricolts on Bloomberg Radio.
Speaker 2: This week on the podcast. Jeff Becker chairman and CEO
Speaker 2: of Jennison Associates. They're part of the Pigeum family of
Speaker 2: asset managements. Jennison manages over two hundred billion dollars in assets.
Speaker 2: Jeff has really a fascinating background, from Arthur Anderson to
Speaker 2: Altus to ion G. Eventually he becomes CEO of Voya
Speaker 2: when the parent company spun out the US holdings into
Speaker 2: a separate entity. Really a fairly unique career path and
Speaker 2: is sort of uniquely situated to look at the world
Speaker 2: of investing. Jennison launched way back in nineteen sixty nine
Speaker 2: as a growth equity shop. Their focus is on generating
Speaker 2: alpha with high conviction concentrated portfolios. They've put off a
Speaker 2: damn good track record over the years. I thought this
Speaker 2: conversation was really interesting. There aren't many people who have
Speaker 2: this sort of perspective and perch to see the world
Speaker 2: of investing from both an institutional and insurance based perspective
Speaker 2: and a long term retail investment perspective. I thought this
Speaker 2: conversation was really interesting, and I think you will also
Speaker 2: with no further ado my conversation with Jennison associates Jeff Becker.
Speaker 2: So let's start with your background. You get a bachelor's
Speaker 2: in economics from Colgate and then an MBA in finance
Speaker 2: from n YU. Stern. Sounds like you had been thinking
Speaker 2: about finance as a career right from the start.
Speaker 3: Quite the contrary, Berry, I had no idea what I
Speaker 3: wanted to do in college or coming out of college.
Speaker 3: I was a liberal arts major. My parents felt strongly
Speaker 3: about getting you know, me a liberal arts degree and
Speaker 3: having me learn how to read and write effectively, and
Speaker 3: so that was the goal. I was in economics, an
Speaker 3: English major. Econ was the closest thing you could get
Speaker 3: to business in some of those schools, and so, you know,
Speaker 3: that's what I majored in. You know, I had no
Speaker 3: real guidance in terms of finance. Neither of my parents
Speaker 3: were in the financial industry, and so I did what
Speaker 3: most students did in those days. As you saw on
Speaker 3: the board who was coming up to interview and potentially
Speaker 3: hire undergrads, and I saw that what were in those
Speaker 3: days the big eight accounting firms were coming up to hire,
Speaker 3: and they had this program where they would hire Liberal
Speaker 3: Arts graduates, have them work, and as part of the arrangement,
Speaker 3: would pay for you to go to grad school. So
Speaker 3: it was a combin find program through Arthur Anderson to
Speaker 3: go to NYU. And they were originally paying for a
Speaker 3: master's in accounting, but ultimately everyone parlayed that into an
Speaker 3: MBA in finance.
Speaker 2: Huh. Really interesting And did you end up at Arthur
Speaker 2: Anderson for any length of time?
Speaker 1: I did? I did.
Speaker 3: I ended up there for for seven years. It was
Speaker 3: It was a terrific experience. It was a great company.
Speaker 3: You know, in those days, these companies hired you know,
Speaker 3: crops of undergrads, they trained them together. We learned everything
Speaker 3: you know across from accounting, to auditing, to to UH
Speaker 3: tax and valuation. I ended up in what was called
Speaker 3: the Valuation Services Group, where we valued real estate and
Speaker 3: businesses either for transactions or for m and A activity.
Speaker 3: And it was a terrific company, a great learning experience.
Speaker 3: They sent you out to clients very early on in
Speaker 3: your career, and you also got people management skills pretty
Speaker 3: early on.
Speaker 2: So learning to value real estate, learning to value companies
Speaker 2: sounds like you're going into private equity and private credit
Speaker 2: down the road, like that seems to be the path
Speaker 2: these days. What was that experience like and how did
Speaker 2: it affect how you look at investments today?
Speaker 3: You would have thought that I didn't know what private
Speaker 3: equity or private credit really was. At the time I
Speaker 3: had started to shift more and more into real estate.
Speaker 3: The background of tearing apart financial statements and balance sheets
Speaker 3: and discounted cash flow analysis was a great foundation really
Speaker 3: for anything in you doing finance ultimately, So it was
Speaker 3: a great experience in that regard. But I was starting
Speaker 3: more and more to specialize in real estate, and as
Speaker 3: a result, I got hired away by one of Anderson's clients,
Speaker 3: which was ETNA, and ETNA had a very large commercial
Speaker 3: real estate business. As you may recall, the insurance companies
Speaker 3: had huge commercial loan portfolios in those days that they
Speaker 3: were using to backstop long dated life insurance liabilities. It
Speaker 3: seemed like the perfect match of asset and liabilities until
Speaker 3: real estate valuations bottomed out and the life companies ended
Speaker 3: up with a whole bunch of mortgage loans that were underwater.
Speaker 3: That led to a terrific experience for me being part
Speaker 3: of the workout of all of those loans in the
Speaker 3: early nineties. So we did foreclosures, we did restructurings, we
Speaker 3: did equity kickers, and we pulled up some of these
Speaker 3: loans into CMBs deals and sold them through Wall Street.
Speaker 3: It was really a terrific experience and really bred out
Speaker 3: of a crisis.
Speaker 2: And I just want to emphasize we're not talking the
Speaker 2: beginning of the pandemic in twenty twenty. We're not talking
Speaker 2: about the financial crisis in eight oh nine. You're talking
Speaker 2: about really the post SNL crisis late eighties, early nineties,
Speaker 2: where a ton of commercial real estate suddenly took a
Speaker 2: big hit. Eventually you become chief credit officer covering real estate.
Speaker 2: Tell us a little bit about that.
Speaker 3: Yeah, I was. I was part of, you know, the
Speaker 3: management that ultimately had to determine, you know, the valuation
Speaker 3: and the credit approval of the different transactions that we
Speaker 3: were working on. Whether that was originally putting out new
Speaker 3: mortgage loans and determining whether it was a you know,
Speaker 3: a good credit for the insurance company capital, or when
Speaker 3: we got into the restructuring period, it was about was
Speaker 3: this the right deal, Were these the right terms? You
Speaker 3: know for us as we as we tried to salvage
Speaker 3: the portfolio.
Speaker 2: And then following ANA, you end up at Altus Investment Manager,
Speaker 2: your CFO there. What was that like, going from analyzing
Speaker 2: credit to being chief financial officer for an investment firm.
Speaker 3: Well, one of the things we were doing by working
Speaker 3: out the troubled mortgage loan book at ETNA is we
Speaker 3: were also working ourselves out of a job. So the
Speaker 3: job was to wind down the portfolio, and we were
Speaker 3: actually given retention agreements that were two years in duration,
Speaker 3: and at the end we essentially were out of jobs.
Speaker 3: That was a little bit scary for an early career endeavor,
Speaker 3: but by the same token, it was the first time
Speaker 3: in my life I ever saw a six figure payment
Speaker 3: come at one time, and it was quite rewarding at
Speaker 3: an early stage in my career. So I knew I
Speaker 3: was going to be out of a job. ATNA was
Speaker 3: up in Hartford, Connecticut, so I was up there alone
Speaker 3: as a young man, and I went to the head
Speaker 3: of HR at ETNA, and I said, this has been
Speaker 3: a terrific experience, but my gig is up and I'm
Speaker 3: probably going to head back to New York City. Is
Speaker 3: there anything that I should look at within ETNA. She
Speaker 3: happened to be a Colgate grad. Took an interest in
Speaker 3: me as a Colgate grad and said, yeah, we've got
Speaker 3: this great little third party institutional investment manager named Altis
Speaker 3: Investment Management. It runs pretty independently, has about one hundred
Speaker 3: billion in assets. I'm going to send you over there
Speaker 3: to meet the young Dynamic make CEO. There a guy
Speaker 3: named John Kim. So I went over and met John.
Speaker 3: We had a terrific three hour conversation and at the
Speaker 3: end of the conversation, he said, you're hired. And I said,
Speaker 3: I'm hired. What am I going to do? And he said,
Speaker 3: I don't know, we'll figure it out, but I think
Speaker 3: you're going to be CFO. And I said, well, I
Speaker 3: know Arthur Anderson is on my resume, but I actually
Speaker 3: have never practiced accounting and so I'm not sure that's
Speaker 3: the right role for me. And he said, wow, we've
Speaker 3: got a really strong finance team and a good strong controller.
Speaker 3: I want you to be a more strategic CFO. I
Speaker 3: want you to work on structured deals m and a
Speaker 3: levers of profitability. And so that turned into a CFO role,
Speaker 3: which again is a terrific experience for anything you do.
Speaker 3: Really understanding how businesses make money and the levers of
Speaker 3: profitability is a great experience.
Speaker 2: Huh. So how do you go from Altis to ING
Speaker 2: Investing Management? What was that transition like?
Speaker 3: Well, in two thousand and three, I fired etna's financial
Speaker 3: businesses and that was the life insurance, retirement and asset
Speaker 3: management businesses, and so Altis went along with that. With
Speaker 3: that acquisition, Ing had been on a buying spree around
Speaker 3: the world and in the US, buying up insurers and
Speaker 3: other businesses, and had ultimately ended up with about six
Speaker 3: asset managers brands that are now all gone. Altis the
Speaker 3: one I came to the party with Pilgrim Firm and Cells,
Speaker 3: Lexington Partners, Relia Star Research, the original Ing Investment Management.
Speaker 3: But Ing did not want to see these runs as boutiques. Ultimately,
Speaker 3: in the long run, Ing had a very integrated model,
Speaker 3: a mono brand approach to the world, and wanted to
Speaker 3: bring all these asset managers together. So I was selected
Speaker 3: to help lead the integration of these asset managers, which
Speaker 3: was which was an interesting project. Each of these asset
Speaker 3: manag had a CEO. These boutiques were pretty fiercely independent
Speaker 3: and it was a bit of a bumpy ride as
Speaker 3: we as we brought them together, but ultimately we did.
Speaker 3: We you know, we started out in some cases with
Speaker 3: four small cap equity teams, and in some instances we
Speaker 3: selected one and not the others, and others instances we
Speaker 3: might have combined teams, and in other instances we started
Speaker 3: all over. So it was, you know, a multi year
Speaker 3: project to really bring all of what were the acquired
Speaker 3: asset managers into one integrated IG Investment Management, and ultimately
Speaker 3: I was the CFO of that initially and then later
Speaker 3: the COO, the CEO at the time, came to me
Speaker 3: and said, you did a terrific job on the integration project.
Speaker 3: You can be ce CFO or COO. Which one do
Speaker 3: you choose? And I said, well, can I be both
Speaker 3: and and he said no, I can't do that right now,
Speaker 3: so you have to pick one, and I chose CFO.
Speaker 3: And my rationale was the CFO is always at the
Speaker 3: head table because there's always a financial implication to everything
Speaker 3: you do. So that's where I started, but ultimately did
Speaker 3: become COO as well.
Speaker 2: Eventually ING changes its name to Voya and everything is
Speaker 2: now branded Voya that were either of these other pieces
Speaker 2: or ING and you rise to the role of CEO.
Speaker 2: How did that come about and what was it like
Speaker 2: going from COO and CFO to CEO.
Speaker 3: Yeah, it happened because of another crisis in two thousand
Speaker 3: and eight, the Great Financial Crisis. ING had gotten overexposed
Speaker 3: in mortgages and had to take a loan from the
Speaker 3: Dutch state to shore up their Tier one capital ratios.
Speaker 3: And as part of that deal with the Dutch government,
Speaker 3: ING agreed to sell off the US properties. If you
Speaker 3: can remember back to the start of the financial crisis,
Speaker 3: it was viewed as largely a US and so I
Speaker 3: think there was a desire to shed the businesses that
Speaker 3: you know where the where the subprime mortgage bubble had
Speaker 3: burst ultimately, and so I was I was working for
Speaker 3: the head of ING Investment Management. But when I decided
Speaker 3: to take this loan, there was a change in leadership
Speaker 3: and my boss became head of I in g America's
Speaker 3: all of the insurance, retirement and life businesses, and I
Speaker 3: became a CEO of ING Investment Management, which later became Voya.
Speaker 3: The way I found out that I was becoming CEO
Speaker 3: of I G I Am. Was a bit of an
Speaker 3: interesting story. I was coaching my son at a U
Speaker 3: twelve hockey tournament up in the Northeast and my cell
Speaker 3: phone kept ringing while I was on the bench yelling
Speaker 3: at kids to skate harder and get into the get
Speaker 3: into the corners. And it kept ringing, and it was
Speaker 3: my boss. And it was a Sunday, And eventually, in
Speaker 3: between periods, I picked it up and and it was
Speaker 3: my boss. At the time was a gentleman named Rob Leary,
Speaker 3: a terrific mentor of mine, who said, I need you
Speaker 3: to get down to my house tonight. I said, Rob,
Speaker 3: I'm up in the Boston area. He lived in Greenwich, Connecticut.
Speaker 3: He said, no, you have to be here, and I said,
Speaker 3: am I fired? And because if so, I'm not coming down.
Speaker 3: Just tell me now. I'm going to finish the game.
Speaker 3: And he said, no, you're not fired, but you have
Speaker 3: to get down here. So I made my way down
Speaker 3: to Greenwich, Connecticut, and I proceeded to learn that I
Speaker 3: and G had taken the loan from the Dutch state
Speaker 3: and that in the morning before we woke up, because
Speaker 3: Europe's ahead, it was going to go public and my
Speaker 3: boss would become the CEO of the Americas and I
Speaker 3: would become the CEO of the investment management firm, and
Speaker 3: we planned what was going to happen. The next morning.
Speaker 3: I was going to have to assure our investment teams,
Speaker 3: our clients, our pension consulting partners that everything was going
Speaker 3: to be okay and that we were you know, we
Speaker 3: were still in business. But as you can imagine, it's
Speaker 3: incredibly hard to run an asset manager with a for
Speaker 3: sale sign on your back. Because Ing had announced that
Speaker 3: it would dispose of the US businesses. So another crisis
Speaker 3: bred opportunity for me. I had to actually tell my
Speaker 3: team of peers that I was now their boss. Because
Speaker 3: it was so chaotic that no one came in to
Speaker 3: actually deliver that message. I had to deliver it myself.
Speaker 3: But it was a great team and we rallied together
Speaker 3: and we built the business, grew it coming out of
Speaker 3: the financial crisis, and then that ultimately became the business
Speaker 3: that we spun out as Voya.
Speaker 2: So two questions that first, I have to get the
Speaker 2: date of this, Like, was this right in the middle
Speaker 2: of the crisis? Was it towards the tail ends when
Speaker 2: did you get this Sunday hockey phone call?
Speaker 3: Yeah, I was about the middle of two thousand and nine.
Speaker 3: So two thousand and eight, you know, as you remember Barry,
Speaker 3: fourth quarter was chaotic. We were having global calls, trying
Speaker 3: to preserve capital. Who knew what was failing next. And
Speaker 3: then as we got into two thousand and nine, companies
Speaker 3: were starting to sort out, you know, where they were,
Speaker 3: and that's and it was about mid two thousand and
Speaker 3: nine where Ing decided to take the state aid.
Speaker 2: But the second question is he couldn't have told you
Speaker 2: that over the phone, Like, I know, they want everybody
Speaker 2: in the room when you're planning, but now, no, this
Speaker 2: is good news. You're getting a promotion. Get down here.
Speaker 2: It's important. That's a stressful drive from Boston to granted
Speaker 2: it was I.
Speaker 3: Think he was being extra cautious given it that it
Speaker 3: was material, non public information and pretty significant information at
Speaker 3: that and also we needed to be up and running
Speaker 3: in New York Monday morning, and so he needed to
Speaker 3: make sure I was down Sunday night.
Speaker 2: Gotcha. That's really that's really quite fascinating. How did you
Speaker 2: end up going from Voya to Jennison Associates? What drew
Speaker 2: you there.
Speaker 3: Yeah, I wasn't necessarily looking for a new role. I
Speaker 3: was enjoying joining the role at Voya, being CEO of
Speaker 3: the asset manager. I was on the executive committee. I
Speaker 3: was learning new skills being part of quarterly earnings calls
Speaker 3: and and and you know, helping grow that business as
Speaker 3: part of a new company and new brand. But at
Speaker 3: the same time, I was probably deep down ready for
Speaker 3: a change. I had been with the company for twenty years,
Speaker 3: but really it had changed around me, from Altus to
Speaker 3: ETNA to two I n G and and then DA Voia,
Speaker 3: and so I was ready for a change. I said
Speaker 3: that to myself that if I left, it would not
Speaker 3: be for another insurance or bank owned asset manager. And
Speaker 3: no disrespect to those those businesses. I had terrific experiences
Speaker 3: and opportunities presented to me there, but I just felt that,
Speaker 3: you know, a new experience, maybe going back to something
Speaker 3: more independent or private would would be the uh would
Speaker 3: be the move for me. But I got the call
Speaker 3: and from a recruiter, and Jennison was an intriguing company
Speaker 3: to me. It's you know, just well known quality firm,
Speaker 3: strong results, impressive client roster and I'd heard it had
Speaker 3: a great culture, so I was intrigued and agreed to
Speaker 3: have have some meetings and really really got quite interested
Speaker 3: in the business. I thought the people were outstanding that
Speaker 3: I met, They validated the culture, the client list and
Speaker 3: roster truly was impressive. What you know, what I had
Speaker 3: to get my head around is that it was owned
Speaker 3: by an insurance company. However, part of pgm's multi boutique model,
Speaker 3: and that was that was very appealing to me. I
Speaker 3: think for this stage of the asset management industry, a
Speaker 3: multi boutique model is a good model. You get the
Speaker 3: asset class specialization, you get the entrepreneurialism in the boutique,
Speaker 3: but you get the benefit of being part of a
Speaker 3: large your manager that has access to wealth management platforms, capital,
Speaker 3: global distribution. So it seemed like a very good business
Speaker 3: model that allowed for sort of the best of both worlds,
Speaker 3: and you know, I was therefore attracted to it and
Speaker 3: really have not regretted the move one bit.
Speaker 2: Really interesting talk a little bit about Jennison. You mentioned
Speaker 2: they had been around a while nineteen sixty nine. They've
Speaker 2: been around for let's call it fifty plus, almost sixty years.
Speaker 2: What sort of traditions and cultures made that longevity so
Speaker 2: attractive to you.
Speaker 3: Yeah, it was all around reputation. And the history is
Speaker 3: that Jennison, founded in nineteen sixty nine, was really one
Speaker 3: of the first independent institutional asset managers. In those days,
Speaker 3: all the institutional asset management was done out of the banks,
Speaker 3: and there were seven founders who decided that maybe they
Speaker 3: could do it better, and they left their banks and
Speaker 3: they set up the business in the in the Drake
Speaker 3: Hotel in New York City and they started to u
Speaker 3: they started to invest. They they ultimately were growth investors,
Speaker 3: but growth investing was not even known at the time. Uh,
Speaker 3: you know, the Russell one thousand growth didn't even exist.
Speaker 3: But the team started investing in what they believed to
Speaker 3: be the fastest growing companies, the disruptors of the time,
Speaker 3: and really became there for one of the earliest true
Speaker 3: growth investors. And the founder that that that survived the
Speaker 3: the you know, almost the entirety of the business and
Speaker 3: and was there when I arrived was sig Sigalis, who
Speaker 3: was an iconic investor again really one of the first
Speaker 3: dedicated growth investors. He was an incredible investor but also
Speaker 3: an incredible man.
Speaker 2: Uh.
Speaker 3: He worked right up until he passed two years ago
Speaker 3: at eighty nine, literally until the week before. He was
Speaker 3: never going to retire. He you know, he he was
Speaker 3: someone who taught me a lot, He taught the firm
Speaker 3: a lot. But at the end of the day, he
Speaker 3: was an intense competitor who wanted to win. But he
Speaker 3: was very values based. Everything was about the client and
Speaker 3: about values. And he had a great saying, which was
Speaker 3: do what's right for clients, and that'll always be right
Speaker 3: for the business. And I think those are pretty pretty
Speaker 3: sage words. And if you're serving your clients well, you're
Speaker 3: going to both retain and get new clients. And in fact,
Speaker 3: if you look at our you know our client roster,
Speaker 3: two thirds of our clients have been with us for
Speaker 3: more than ten years and forty percent more than twenty years.
Speaker 2: Wow, that's pretty substantial. I'm kind of intrigued by the concept.
Speaker 2: And I mean I was a kid in nineteen sixty nine.
Speaker 2: I think I was seven or eight years old, but
Speaker 2: the idea that growth investing was like a novel concept.
Speaker 2: I get the idea that, hey, this was kind of
Speaker 2: the early days of a bear market that went on
Speaker 2: for another decade. But tell us what does it mean
Speaker 2: to be growth oriented investors when there's no such thing
Speaker 2: as a typical growth index or a value index.
Speaker 3: And what growth investing has meant for Jennison and it
Speaker 3: is it is the original legacy and uh an original
Speaker 3: book of business for the firm. We've extended from there.
Speaker 3: But growth investing for us has really been about high conviction,
Speaker 3: deep fundamental research driven active management management. And you know,
Speaker 3: we're we're concentrated manager. We take we take large positions
Speaker 3: in in concentrated portfolios, and we're really striving to be
Speaker 3: that high alpha equity manager for for pension plans and
Speaker 3: for wealth allocators, and often we're part of an asset
Speaker 3: allocation and you know, we're you know, we're the alpha
Speaker 3: in the corners, if you will. And you know, I
Speaker 3: think that's the right place to play as a fundamental
Speaker 3: active equity manager because the hollow has been middled, because
Speaker 3: the middle has been hollowed out. And you know, at
Speaker 3: the end of the day, no one's going to pay
Speaker 3: active management fees for two to three tracking error equity.
Speaker 2: Huh. That makes a lot of sense. So I got
Speaker 2: to ask two questions about concentration and deep conviction. First,
Speaker 2: what is a concentrated portfolio. I've seen a lot of
Speaker 2: people describe themselves as concentrated portfolios and they're fifty sixty,
Speaker 2: one hundred holdings. It doesn't really seem concentrated. What is
Speaker 2: concentrated mean to you?
Speaker 3: Yeah? For us, fifty sixty would be the largest portfolios
Speaker 3: that we manage in our in our growth book of business.
Speaker 3: We do have down in our small cap and smid
Speaker 3: cap of book of business, we do have larger holdings
Speaker 3: down there, just to get some more liquidity and diversification.
Speaker 3: But for our core franchise of growth portfolios, you know,
Speaker 3: we have ten stock portfolios. We have twenty stock portfolios.
Speaker 3: When we say something focused, it tends to be about
Speaker 3: thirty and for us, you know, Flagship might be up
Speaker 3: to fifty, but not typically more than that.
Speaker 2: And so when you say deep conviction, what does deep
Speaker 2: conviction mean? Is that what leads to these ten stock
Speaker 2: or twenty stock concentrated portfolios. Tell us a little bit
Speaker 2: of what does deep conviction mean?
Speaker 3: Well, I think it starts with our investment research. You know,
Speaker 3: we're a firm of four hundred people, seventy investment professionals,
Speaker 3: about half pms and half analysts. They have very long
Speaker 3: tenures with the firm, about thirty years of experience in
Speaker 3: the industry, more than fifteen on average with the firm,
Speaker 3: and they are doing very deep research by team. So
Speaker 3: every team, our large cap growth team, our global growth team,
Speaker 3: our small smid mid team, our value team, and our
Speaker 3: fixed income team all have dedicated research analysts. So there's
Speaker 3: no central research model, there's no house view, there's no
Speaker 3: you know, mandated approach to seeking alpha. Every team has
Speaker 3: the UH has the ability to seek alpha in its
Speaker 3: own way. And what we have are very long tenured,
Speaker 3: experienced career analysts. So our analysts and our firm ours
Speaker 3: important as our portfolio managers. It's not necessarily a track
Speaker 3: to portfolio management. In fact, we believe, you know, the
Speaker 3: real UH secret, Sauce to to Jennison is the research
Speaker 3: that that we do and what the teams do and
Speaker 3: on the growth side, at the end of the day,
Speaker 3: what we're looking for is innovative and disruptive businesses driving
Speaker 3: structural shifts and industries. You know, business models with with
Speaker 3: significant barriers to entry, secular demand trends driven by superior
Speaker 3: product offerings, and these days you know, as you know,
Speaker 3: that might be evs, autonomous UH driving, machine learning, obesity, drugs,
Speaker 3: or luxury that's owned through the value chain, and all
Speaker 3: of those tend to be superior your growers. They tend
Speaker 3: to have moats around them and are the leaders and
Speaker 3: the disruptors. And you know, as you know, Barry, history
Speaker 3: has shown that market returns over time have been driven
Speaker 3: by a narrow set of disruptors and consistent winners. And
Speaker 3: Jennison has developed a reputation for identifying those companies.
Speaker 2: So the past fifteen years, those innovators, disruptors, companies with
Speaker 2: moats have primarily been US based, right, And we see
Speaker 2: the rest of the world, Asia, Japan, Europe primarily lagging
Speaker 2: the US, although there seems to be a lot of
Speaker 2: signs these days that that's starting to change. Certainly Q
Speaker 2: one tw twenty five, Europe is dramatically outperforming the US.
Speaker 2: How do you think about the relationship between US investing
Speaker 2: and international investing. I know only about ten or fifteen
Speaker 2: percent of your assets are invested overseas. What would it
Speaker 2: take to make that change?
Speaker 3: Yeah, in terms of our our portfolios that are invested overseas.
Speaker 3: And then I'll and then I'll answer your question about
Speaker 3: how do I think about international versus US markets. We
Speaker 3: have about twenty five billion of dedicated international and global portfolios,
Speaker 3: but within our other equity portfolios across the firm, we
Speaker 3: do hold a percentage of international assets, so that that
Speaker 3: number ultimately is about forty billion of our one hundred
Speaker 3: and fifty billion of equity, So it is a little
Speaker 3: larger than it may may appear. And you know, at
Speaker 3: the end of the day, unless we have investment guidelines
Speaker 3: or restrictions from clients, you know, we seek alpha with
Speaker 3: a bit of agnosticism to both the benchmark and the region.
Speaker 3: So we are building portfolios bottoms up, company by company
Speaker 3: and looking for what we you know, view are the
Speaker 3: best companies for our strategy, whether that be you know,
Speaker 3: intrinsic value, and you know what we think are our
Speaker 3: undervalued companies or the disruptors and the growers. In terms
Speaker 3: of international holdings per se as you mentioned the first quarter,
Speaker 3: after a long drought of underperformance compared to the US,
Speaker 3: international equities have had a nice run. You know, it's
Speaker 3: primarily driven by policy shifts locally in some of those regions,
Speaker 3: as well as reactions to current US policy shifts and
Speaker 3: the uncertainty around that. So in Asia, you know, the
Speaker 3: government is clearly priming the pump. In Europe, increased defense
Speaker 3: spending has really ignited, ignited the markets over there, and
Speaker 3: so I think the international markets might have some legs.
Speaker 3: We do still favor the US, you know, in the
Speaker 3: medium term and longer term right now, but certainly international markets,
Speaker 3: after being beaten down for years have come back strongly.
Speaker 2: So let's talk a little bit about risk management. I
Speaker 2: know you guys employ the traditional sected diversification, geographic diversification,
Speaker 2: different strategies, but talk a little bit about your risk
Speaker 2: management and the downside protection you deploy to make sure
Speaker 2: that volatility like we've been seeing doesn't hit the bottom
Speaker 2: line too hard.
Speaker 3: Yeah, And you know, as we discuss Barry, we are
Speaker 3: concentrated managers, high conviction managers, so you know, we're paid
Speaker 3: to take risk and as a result, our portfolios do
Speaker 3: tend to be more volatile than the benchmark, certainly and
Speaker 3: many other managers who are more diversified. So you know,
Speaker 3: we will have periods where we wildly outperform the benchmark,
Speaker 3: in periods where we underperform the benchmark. We're looking typically
Speaker 3: at a holding period in our names of you know,
Speaker 3: three to five years and much longer, and so you
Speaker 3: know we are long term investors. We want to align
Speaker 3: interest with our clients who are long term investors and
Speaker 3: try to filter out the quarter to quarter noise and
Speaker 3: the volatility that comes in between those periods. So again,
Speaker 3: if we can identify those companies early that are going
Speaker 3: to be the longer term winners, that's that's where we go.
Speaker 3: From a risk perspective, what we want to protect against
Speaker 3: is unintended risk. So we're taking very deliberate and concentrated risk.
Speaker 3: But we have every kind of risk management report that
Speaker 3: you would expect in an asset manager to make sure
Speaker 3: we don't have unintended risks, to check our dispersion, and
Speaker 3: to make sure that at the end of the day,
Speaker 3: the risks we're taking our stock selection risk and not
Speaker 3: unintended risk around you know, sized geography sector.
Speaker 2: So I don't usually hear the phrase unintended risk. So
Speaker 2: I certainly understand the risk of performance relative to a benchmark.
Speaker 2: You over underperform, you're gonna outperform. What are some other
Speaker 2: unintended risks? Is it strictly just sector concentration jigra a
Speaker 2: concentration or is there a little more nuance to it.
Speaker 3: We want to make sure at the at the end
Speaker 3: of the day that the risk we're taking is is
Speaker 3: stock specific. That's that's who we are on the equity side.
Speaker 3: We are we are stock pickers, and so we want
Speaker 3: to make sure that you know what's what's coming through
Speaker 3: our portfolio from a risk perspective is all based on
Speaker 3: stock selection and not some of the more factor based
Speaker 3: UH influences that can that can take shape in portfolios.
Speaker 3: And as you mentioned, you know, sector and geography and
Speaker 3: and UH and other.
Speaker 2: Exposures really interesting. So so given that PGEUM is the
Speaker 2: parent company and they run a sort of multi boutique,
Speaker 2: multi strategy approach, how does your concentrated alpha approach to
Speaker 2: investing fit in. Do you have to think about, well,
Speaker 2: maybe this group or that group is doing something similar,
Speaker 2: or do you do your thing and it's up to
Speaker 2: the pairing company to select the allocation they want.
Speaker 3: Yeah. The great thing about the multi manager model at
Speaker 3: PGEUM is each of the affiliates as we call them
Speaker 3: versus boutiques are free to pursue their asset class and
Speaker 3: their specialty UH in their own way. Now to the
Speaker 3: extent that there are multi asset portfolios put together, you
Speaker 3: know within PGEUM that might select components of the different
Speaker 3: affiliates or boutiques. You know, that'll be determined by the
Speaker 3: multi asset team doing the acid allocation. You know, for
Speaker 3: for Genison, given you know the high highly concentrated UH,
Speaker 3: you know nature of our of our equity portfolios, we
Speaker 3: fit into some of those multi asset products, but in
Speaker 3: other cases we don't. We're too high octane UH for that.
Speaker 3: But we are in a number of annuity and and
Speaker 3: other acid allocation products throughout Prudential that that avail themselves
Speaker 3: of our various capabilities. And the other thing that that
Speaker 3: that Jennison can do is we have a small quantitative
Speaker 3: equity team, not to be confused with PGIM Quantitative Services,
Speaker 3: which is a sister company. Our team is there to
Speaker 3: customize our fundamental alpha from our equity portfolios. So if
Speaker 3: a client is looking for a targeted tracking error, a
Speaker 3: targeted volatility, you know, likes what we do but maybe
Speaker 3: can't quite take take the tracking error volatility, we can
Speaker 3: manipulate the portfolio to fit within their requirements. They might
Speaker 3: be someone who wants a sustainable portfolio and you know,
Speaker 3: has some exclusions or types of industries they don't want
Speaker 3: to include. So having this little quad group within Jennison
Speaker 3: to customize our our outcomes for our clients as has
Speaker 3: been a terrific addition of value that has allowed us
Speaker 3: to get into some of these multi asset products. The
Speaker 3: other great thing about the PGM multi manager model that
Speaker 3: I'll come and on is that we have virtually no
Speaker 3: overlap among the different affiliates or boutique. So Jennison is
Speaker 3: the is the fundamental active equity manager. Uh, you know,
Speaker 3: PGEUM Quantitative Services is the quant manager. Pageum fixed income
Speaker 3: has you know, broad based fixed income capabilities. We have
Speaker 3: private real estate, private credit, et cetera. And we're not
Speaker 3: fighting with each other over shelf space in different products
Speaker 3: because we're all experts in what we do.
Speaker 2: Now, it's taken me about ten years to stop saying
Speaker 2: Prudential and start saying pgeum. You did mention Prudential. When
Speaker 2: you think about the parent company, it traces back to
Speaker 2: Prudential Insurance, which is still a giant brand. How does
Speaker 2: the relationship between Genesis, How does the relationship between Jennison
Speaker 2: and PGEUM and PGEUM Prudential just affect the nomenclature. It's
Speaker 2: a lot of stuff to keep straight.
Speaker 3: It is you have you have the master brand of
Speaker 3: Prudential one hundred and fifty years, you have the pGEM
Speaker 3: brand a little over a decade old, and then you
Speaker 3: have the brands underneath Jennison at fifty five years being
Speaker 3: the oldest of the investment management brands. It's also why
Speaker 3: Jennison tends to be the most independent of the of
Speaker 3: the affiliates or boutiques. It was an acquired business. About
Speaker 3: seventy five percent of the assets were sourced by Jennison
Speaker 3: versus assets that have come through some of the Prudential
Speaker 3: or PGYM channels. But you know, we do, you know,
Speaker 3: we do have to be careful about the branding, and
Speaker 3: sometimes it's at the product level. For example, PGUM runs
Speaker 3: a lot of the you know, the consolidated platforms like
Speaker 3: the mutual fund platform and in Europe the use it
Speaker 3: platform that are you know, used to structure the funds
Speaker 3: that are sold into the wealth management channels and there
Speaker 3: for example, if you want to buy Jennison in a
Speaker 3: growth fund through the through the PGAM mutual fund company.
Speaker 3: It's the Pgmjennison Growth Fund, So sometimes we have multiple
Speaker 3: brands at play.
Speaker 2: Huh, really interesting. So let's talk a little bit about
Speaker 2: the current environment. It certainly has been a chaotic first
Speaker 2: quarter with tariffs on and off. Again, you guys are
Speaker 2: deep fundamental investors. How do you think about newsflow and
Speaker 2: all this noisy stuff when you're looking at the fundamentals
Speaker 2: of companies.
Speaker 3: It's it's hard to do, but it really comes down
Speaker 3: to focus. At the end of the day, we have
Speaker 3: to try to filter out the noise. Now we can't
Speaker 3: we're not macro investors, but we have to be macro aware.
Speaker 3: We have to understand if policy shifts or you know,
Speaker 3: anything in the macro environment will ultimately affect the environ
Speaker 3: in which our companies operate. So we always bring it
Speaker 3: back to the fundamentals. You know, we can't put blinders
Speaker 3: on and say this is a great company, but if
Speaker 3: if the landscape in which they operate changes, it can
Speaker 3: affect the fundamentals of the company. So, you know, we
Speaker 3: work very hard to try to separate the you know,
Speaker 3: the noise from the fundamentals. But at the end of
Speaker 3: the day. Sometimes that macro environment can affect the fundamentals.
Speaker 2: So when it starts affecting the fundamentals, how do you
Speaker 2: manage it? I'm assuming since you're the alpha managers, you
Speaker 2: don't have an option of saying we're going to go
Speaker 2: to cash or we're going to go to bonds. Is
Speaker 2: in a matter of saying, hey, Europe seems to be
Speaker 2: doing better, we're going to rotate shift some of our
Speaker 2: exposure from the US two overseas. How do you deal
Speaker 2: with the macro once it starts affecting the fundamentals.
Speaker 3: Yeah, it's exactly as you described. We're paid to invest
Speaker 3: in a certain strategy for a client, so we hold
Speaker 3: very little cash just forquidity and trading. We're paid to
Speaker 3: be fully invested, and so you know, as we see
Speaker 3: either a sector or a supply chain or a company's
Speaker 3: fundamentals coming under pressure, will will either underweight or get
Speaker 3: out of the company completely and look for the next
Speaker 3: best opportunity.
Speaker 2: Really kind of interesting. You had a piece recently at
Speaker 2: Jennison titled is value investing debt? Tell us a little
Speaker 2: bit about that.
Speaker 3: Well, Well, growth indexes have certainly outperformed value for for
Speaker 3: well over a decade. I think we're all aware of that.
Speaker 3: That's that's been good for Gennison two thirds of our
Speaker 3: equity assets or our growth oriented assets, and and we've
Speaker 3: we've benefited during this period and also outperformed and raised
Speaker 3: money and new clients. So, you know, a lot of
Speaker 3: that has been has been a great tailwind for our business.
Speaker 3: But we also have a high performing value team that's
Speaker 3: that's put up some very good numbers. The way we've
Speaker 3: uh the way we manage in value is called an
Speaker 3: intrinsic value approach, which is very opportunistic. It's not deep
Speaker 3: value or a Fallen Angel type strategy. We look for
Speaker 3: companies with temporarily depressed earnings versus a permanent situation. We
Speaker 3: try to identify those, and periods of short term volatility
Speaker 3: can actually favor our approach if we can, if we
Speaker 3: can decipher, you know, which companies have hidden inflection point
Speaker 3: and get into those early and hold them long term.
Speaker 3: Now the market has broadened out recently from the mag
Speaker 3: seven and some of the you know, the most concentrated
Speaker 3: positions that have that have led the market, and and
Speaker 3: we're being rewarded, you know, for executing in the value space.
Speaker 3: There's still good companies and good growth in value. I
Speaker 3: don't think investors really think about growth versus value investing
Speaker 3: like they used to. I think they think about it
Speaker 3: as portions of the portfolio, stable growers maybe with dividends,
Speaker 3: versus as innovators and disruptors that that might lead the
Speaker 3: way in the future.
Speaker 2: That's really that's really kind of interesting. It's funny because
Speaker 2: you're talking about your approach to intrinsic value, and I
Speaker 2: would imagine that as the mag seven and traditional growth
Speaker 2: equity falters, the volatility of this market would be great
Speaker 2: for an opportunistic intrinsic value investor. Tell us how the
Speaker 2: value guys are salivating these days over what the state
Speaker 2: of markets are with volatility spiking up close to thirty.
Speaker 3: Yeah, I think volatility actually can be good on the
Speaker 3: growth side as well. So I think I think when
Speaker 3: you're a fundamental stock picker, you you want number one
Speaker 3: is as little correlation as possible. If everything goes up,
Speaker 3: it's hard to differentiate yourself when market's broaden out, you know,
Speaker 3: when when volatility is UH is elevated, you know it,
Speaker 3: really you really have to have skill to to differentiate
Speaker 3: and to separate the noise, uh, you know, from the
Speaker 3: fundamentals of the company, and so we think we can
Speaker 3: benefit in these periods both on the value and the
Speaker 3: growth side. Certainly, you know, on the growth side has
Speaker 3: pulled back most recently in the first quarter. You're you're
Speaker 3: starting to see that, uh shift back already. It appears
Speaker 3: that mid March was perhaps the you know, the the
Speaker 3: you know, the bottom, and we seem to be, you know,
Speaker 3: starting to bounce off of that. I for one, UH
Speaker 3: don't don't see a recession on the horizon, at least
Speaker 3: not a not a severe one. So I think we
Speaker 3: will continue to see as as you know, we filter
Speaker 3: through the noise. We learned the tariffs may be a
Speaker 3: little more targeted and forgiven in some instances that uh,
Speaker 3: the supply chains don't get as disrupted as as we thought,
Speaker 3: and we could see a good period for growth equity.
Speaker 2: Again, So you have large cap growth equity as a focus,
Speaker 2: you have global equity opportunity. What are some of the
Speaker 2: other areas where you guys focus in terms of looking
Speaker 2: for alpha.
Speaker 3: Yeah, growth growth equity, as we've talked about, was the
Speaker 3: foundation of the firm and the largest book of assets
Speaker 3: about half the assets of the firm. We have a
Speaker 3: global growth team that was built and extended off of that,
Speaker 3: getting into global, international and emerging market equity, also following
Speaker 3: a growth style and philosophy. That team leverages a lot
Speaker 3: of the same research of our growth analysts. Then we
Speaker 3: have a small smid mid cap team. They are a
Speaker 3: little more growth managers, but a little more valuation sensitive there,
Speaker 3: and we offer that in sort of growth and core portfolio.
Speaker 3: Our value team. We talked about our intrinsic value capabilities,
Speaker 3: but you know, on the value side, we also have
Speaker 3: certain sector funds infrastructure, utilities, energy and other things, and
Speaker 3: including some of some strategies that are in demand in Europe,
Speaker 3: like carbon solution strategy that's a sort of a brown
Speaker 3: green strategy, if you will. And then we have our
Speaker 3: fifty billion dollar fixed income shop based up in Boston.
Speaker 3: They are really the antithesis of what we do in
Speaker 3: high conviction focused concentrated equity. They are a high, high
Speaker 3: quality credit shop staying in you know, the higher end
Speaker 3: of the space there down the fairway core fixed income
Speaker 3: manager managing for the largest pension plans in the world,
Speaker 3: and also able value in LDI mandates. So it's also
Speaker 3: a nice diversifier for the business. We have this very stable,
Speaker 3: you know, core credit manager and this high conviction, high
Speaker 3: alpha equity manager.
Speaker 2: So given that there seems to be a consensus at
Speaker 2: your shop of higher for longer at least when it
Speaker 2: comes to rates. Since you brought up fixed income and
Speaker 2: you brought up credit, does this allow your clients to say, hey,
Speaker 2: we could take a little off the table with equity
Speaker 2: and focus a little more on on stable fixed income.
Speaker 2: How does that balance work?
Speaker 3: Yeah, we've seen that over the last several years as
Speaker 3: rates ticked up and there was something to earn in
Speaker 3: fixed income. Again, we watch pension plans, you know, adjust
Speaker 3: their their asset allocations. You know, one of the double
Speaker 3: edged swords of being a high performing equity manager is
Speaker 3: when the equity markets run up and you outperform the
Speaker 3: benchmark you get allocated against, you're the one they take
Speaker 3: the money away from from. So you know, we've we've
Speaker 3: had that happen and have been a victim of our success,
Speaker 3: if you will, in some of these areas. So we
Speaker 3: have seen that over the last couple of years as
Speaker 3: rates ticked up, where we did see some of our clients,
Speaker 3: you know, maintain us, but shift sort.
Speaker 2: Of rebalanced falls from alpha generating concentrated equity into more stable,
Speaker 2: lower yielding fixed income.
Speaker 3: Exactly exactly. I mean, we we do know. I'm not
Speaker 3: one to call rates per se, but you know, I
Speaker 3: agree with the base case out there that we'll probably
Speaker 3: see two cuts. Hopefully they're you know, they're for the
Speaker 3: right reasons and not bad news cuts, if you will.
Speaker 2: So that's interesting you say that because originally last year
Speaker 2: Wall Street was looking for a lot more cuts than
Speaker 2: we got, and the sort of pushback to the expectation was, Hey,
Speaker 2: the economy is really robust. Consumers are spending, companies are hiring,
Speaker 2: capex spending is up, revenue and profits are up. Why
Speaker 2: are you guys expecting cuts? How does that transition? Now?
Speaker 2: Where you know, I'm in your camp, I don't really
Speaker 2: see an imminent recession, but at the same time, it
Speaker 2: certainly appears that recession risks are ticking up. They're still
Speaker 2: relatively low, but they're appreciably higher than they were at
Speaker 2: the end of twenty twenty four. So if we're going
Speaker 2: to get two cuts, is that because the FED wants
Speaker 2: to normalize rates to where they've been over the past
Speaker 2: twenty twenty five years as inflation sort of settles down,
Speaker 2: or are we going to see cuts because the economy
Speaker 2: is beginning to slow.
Speaker 3: Yeah, I agree with you completely. I hope it's the
Speaker 3: former and not the latter. We are starting to see
Speaker 3: some signs of some potential slowing of growth. I do
Speaker 3: think we could see growth slow down from what it's been.
Speaker 2: And it's been red hot, and it's a couple of years.
Speaker 3: And it's been red hot. You know, there's still some
Speaker 3: good signs out there. Housing starts are up, services pmis up,
Speaker 3: you know, retail sales and manufacturing are down, consumer sentiments down.
Speaker 3: The income and labor markets importantly are still are still decent.
Speaker 3: I think that'll be a major determinant of where we go.
Speaker 3: Inflation is stubborn, but it's showing signs of coming down
Speaker 3: in key areas. Tariff's notwithstanding, and you know, I think
Speaker 3: the tariff path will determine a lot of where we
Speaker 3: go here.
Speaker 2: So it sounds like you guys stick to your knitting.
Speaker 2: You do fundamental research, You focus on intrinsic value, but
Speaker 2: you're certainly aware that, hey, what's going on in the
Speaker 2: rest of the world. It could have an impact then
Speaker 2: lead over if you're advising pension funds or foundations that
Speaker 2: have a perpetual lifespan or at least future liabilities that
Speaker 2: are decades off, is the best advice. Hey, it's gonna
Speaker 2: get bumped for a while, but you have to look
Speaker 2: past this, look to the other side of whatever happens
Speaker 2: over the next one two, four years or is it
Speaker 2: everybody manned their battle stations.
Speaker 3: Yeah, I think keeping a long term focus is good advice. Uh,
Speaker 3: you know, for for the pension plans who obviously have
Speaker 3: teams of experts, you know, focused on their asset allocation,
Speaker 3: but also for the retail investor who who obviously has
Speaker 3: the financial advisor as well. But you know, as you
Speaker 3: know Barry, staying invested is key when people try to
Speaker 3: time the markets and and exit, you know, they they've
Speaker 3: they've always regretted that, you know, being in the market
Speaker 3: during those key points of inflection when when markets take
Speaker 3: up or missing that that last uh, that last large spike,
Speaker 3: you know, it really can have a dramatically negative impact
Speaker 3: on your returns overall.
Speaker 2: Yeah, We've seen a lot of studies that show the
Speaker 2: worst days and the best days tend to come cluster together,
Speaker 2: and it's very hard to miss one and catch the other. Absolutely,
Speaker 2: so I know I only have you for a limited
Speaker 2: amount of time. Let's jump to our favorite questions that
Speaker 2: we ask all of our guests, starting with what's keeping
Speaker 2: you entertained these days? What are you either watching or
Speaker 2: listening to? What's your tell us about your favorite podcast? Netflix? Whatever?
Speaker 2: You know?
Speaker 3: I'm always well behind where everyone else is. I didn't
Speaker 3: watch the first episode of The Sopranos until until the
Speaker 3: series was over, and I'm just starting Yellowstone, So that
Speaker 3: tells you how up to date.
Speaker 2: You're ahead of me. And Yellowstone it's the next one
Speaker 2: up in Mike queue. Are you enjoying it?
Speaker 3: I just started it, so so far, so good. I've
Speaker 3: heard so many great things about it, so I'm looking
Speaker 3: forward to it. I'm a bit of a history buff,
Speaker 3: so I've been working my way through the ken Burns, uh,
Speaker 3: Doctor Malarisa. I've seen the Brooklyn Bridge, the Statue of Liberty,
Speaker 3: the Civil War, the Vietnam War, and the Great War.
Speaker 3: And the next one up for me is Benjamin Franklin.
Speaker 3: So I really enjoy ken Burns and how he approaches
Speaker 3: you know, the documentary.
Speaker 2: Huh, really interesting. You You mentioned one of your mentors previously.
Speaker 2: Tell us about the folks who helped shape your career.
Speaker 2: Who were your mentors?
Speaker 3: Yeah, I would say, first, you know, it was my
Speaker 3: mother from a values and from a work ethic perspective,
Speaker 3: first generation college grad, went to got a master's at Georgetown,
Speaker 3: worked in politics, ransom nonprofits, and then ultimately worked in education.
Speaker 3: She's she's ninety years old and still alive and doing well.
Speaker 3: And you know, she's been a great inspiration to me.
Speaker 3: Again from a values and work ethic perspective. I've also
Speaker 3: had the great opportunity to work for some great leaders
Speaker 3: and manager I tried to learn from each one of
Speaker 3: them along the way, take the styles or the characteristics
Speaker 3: that I most admired of each of them and try
Speaker 3: to incorporate that into my leadership style. And at Altis
Speaker 3: it was John Kim and Scott Fox at at you know,
Speaker 3: Bob Crispin, Rob Leary at I n g Uh and
Speaker 3: then alone Cara Oagland at Voya to name a few.
Speaker 3: Sig Sigalis who who I mentioned past about two years ago.
Speaker 3: I worked with him for only about six years and
Speaker 3: while you know he wasn't necessarily a mentor in the
Speaker 3: sense of helping me do my job, which was terrific
Speaker 3: when when when I came on board, Sig said, I,
Speaker 3: I managed the money, you managed the firm. And he
Speaker 3: he kept his word there and allowed me to do
Speaker 3: what you know, we felt we needed to do to
Speaker 3: help grow the business and set the strategy. And it
Speaker 3: was a it was a terrific partnership. And UH, and
Speaker 3: I have great admiration for him. So he was more
Speaker 3: an inspiration to me, just the you know, his will
Speaker 3: to win and and the way he impacted everyone around
Speaker 3: him and the quality, UH and the values of the
Speaker 3: firm that he built really inspirational.
Speaker 2: Really really interesting.
Speaker 1: Uh.
Speaker 2: Let's talk about books. What are you reading currently? What
Speaker 2: are some of your favorites?
Speaker 3: Yeah, right, right now, I just started, UH, Leadership in
Speaker 3: Turbulent Times, UH, from from Doris Kurrn's Goodwin. It seems a.
Speaker 2: Little apropos sure right now.
Speaker 3: And and UH, you know, it's a it's a book
Speaker 3: about Lincoln, Teddy Roosevelt, FDR and UH and LBJ and
Speaker 3: it kind of you know, takes you through their you know,
Speaker 3: their administrations and UH and some of the challenges that
Speaker 3: they faced. You know, it's a big book. It sat
Speaker 3: on my coffee table for a few years and I
Speaker 3: looked at it and I, you know, I've wanted to
Speaker 3: kind of tap in, but it was four inches high,
Speaker 3: and and finally I h I did tap in, and
Speaker 3: I'm glad I did.
Speaker 2: Our final two questions, what sort of advice would you
Speaker 2: give to a recent college grad interested in a career
Speaker 2: in either investment, credit, finance, anything along the lines of
Speaker 2: your career experiences.
Speaker 3: Yeah, I would say, first thing, you know, you know,
Speaker 3: getting into finance. The path to finance starts so much
Speaker 3: earlier than it ever did. And in our day, you know,
Speaker 3: it was senior year, it was time to look for
Speaker 3: a job, maybe had an internship, you know, the year before.
Speaker 1: But now.
Speaker 3: Undergrads going into finance, they need to be lining up
Speaker 3: their internships sophomore summer, junior summer, senior summer. So so
Speaker 3: it really starts a lot sooner. But once they're on
Speaker 3: the job, my my advice to them is always builder
Speaker 3: a resume of skills, not a resume of jobs. Try to,
Speaker 3: you know, try to develop as many skills as you
Speaker 3: can along the way, and ask questions early and often
Speaker 3: you're not expected to know anything when when you're young
Speaker 3: and in the job, but as you move on in
Speaker 3: your career, you're expected to know more and it becomes
Speaker 3: a little harder to ask questions and then ask for
Speaker 3: experiences outside of your current duties. So if you see
Speaker 3: something going on in the next department over, ask if
Speaker 3: you can be exposed to that you know while doing
Speaker 3: the job you were hired for, and try to get
Speaker 3: more exposure, but don't expect anything to be given to you.
Speaker 3: You own your career. Seek out mentors and try to learn,
Speaker 3: But at the end of the day, you have to
Speaker 3: take ownership of your career and your advancement will really
Speaker 3: depend on the success of your current role, and if
Speaker 3: you focus on that and do it well, you'll be recognized.
Speaker 2: Really good good advice, And our final question, what do
Speaker 2: you know about the world of investing today? You wish
Speaker 2: you knew thirty forty years ago when you were first
Speaker 2: getting started.
Speaker 3: Well, as I mentioned, I didn't know anything about it
Speaker 3: forty years ago when I was getting started coming out
Speaker 3: of college. But in reflecting back, what I think would
Speaker 3: be helpful would have been how many different types of
Speaker 3: finance careers there actually are? Everyone thinks sort of Wall
Speaker 3: Street investment banking, M and A. But but there's investment management,
Speaker 3: there's wealth management, there's insurance, there's commercial banking, there's you know,
Speaker 3: there's institutional banking. So many many careers in finance and
Speaker 3: past that that that you can go down. I had
Speaker 3: a very narrow view of the investment world. And you know,
Speaker 3: my journey really, you know, happened because of the next
Speaker 3: role that I got. In the next role that I got,
Speaker 3: I didn't have a plan per se, and I think,
Speaker 3: you know, I wish I knew more earlier on and
Speaker 3: I might have set a plan. The plan turned out okay,
Speaker 3: and and I've been happy with it, but you know,
Speaker 3: who knows what the path would have taken had I
Speaker 3: known a little more about it.
Speaker 2: Huh, really interesting stuff, Jeff, Thank you for being so
Speaker 2: generous with your time. We have been speaking with Jeff Becker.
Speaker 2: He's chairman and CEO of Jennison Associates, helping to run
Speaker 2: the firm that manages well over two hundred billion dollars
Speaker 2: in assets. If you enjoy this conversation, be sure to
Speaker 2: check out any of the five hundred and fifty or
Speaker 2: so we've done over the past eleven years. You can
Speaker 2: find those at iTunes, Spotify, YouTube, Bloomberg, wherever you find
Speaker 2: your favorite podcasts. Be sure to check out my new book,
Speaker 2: How Not to Invest The Ideas, numbers, and behaviors that
Speaker 2: destroy wealth and How to Avoid Them, out now at
Speaker 2: your favorite bookseller. I would be remiss if I did
Speaker 2: not thank the Cracked team that helps with these conversations
Speaker 2: together each week. My audio engineer is Steve Gonzalez. Anna
Speaker 2: Luke is my producer. Sean Russo is my researcher. Sage
Speaker 2: Bauman is the head of podcasts at Bloomberg. I'm Barry
Speaker 2: rud Haunts. You've been listening to Masters in Business on
Speaker 2: Bloomberg Radio