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Speaker 1: This is Masters in Business with Barry Ridholts on Bloomberg Radio.

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Speaker 1: This week on the podcast, I have an extra special guest.

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Speaker 1: Her name is Sharon French and she is the head

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Speaker 1: of Beta Solutions at Appenheimer Funds. She has a storied career,

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Speaker 1: stopping at such places as JP Morrigan, Chase, Alliance, Bernstein,

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Speaker 1: and black Rock, amongst others. She has been an instrumental

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Speaker 1: person in the development and growth of the E t

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Speaker 1: F sector as well as a very active participant in

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Speaker 1: the E s G, Environmental, Social and Governance UH sector

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Speaker 1: of investing. She is consistently named one of the most

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Speaker 1: influential people in finance. Most recently Cranes had their list

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Speaker 1: of forty women, but find a list of a hundred

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Speaker 1: most influential women in markets, investing, finance, and Sharon is

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Speaker 1: invariably on that list. You will find this to be

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Speaker 1: an absolutely fascinating conversation. So, with no further ado, my

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Speaker 1: conversation with Sharon French of Oppenheimer Funds. This is Masters

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Speaker 1: in Business with Barry Ridholts on Bloomberg Radio. I'm Barry Ridholts.

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Speaker 1: You're listening to Masters in Business on Bloomberg Radio. My

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Speaker 1: special guest this week is Sharon French. She is the

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Speaker 1: head of Beta Solutions at Oppenheimer Funds, where she also

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Speaker 1: implements the firm's E s G efforts, as well as

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Speaker 1: overseas a number of UH Smart Beta et F products

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Speaker 1: and solutions. She has previously worked at such storied firms

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Speaker 1: as Black Rock Alliance, Bernstein Chase, JP Morrigan Chase. She's

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Speaker 1: a graduate of Wharton School of Business and serves on

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Speaker 1: the board of Women in ETFs. Sharon French, Welcome to Bloomberg.

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Speaker 1: Thank you, Barry. I'm glad to be here. We've been

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Speaker 1: talking about doing this now for a long time. I'm

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Speaker 1: glad we finally got you in the studios to have

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Speaker 1: this conversation. Let's talk a little bit about your career.

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Speaker 1: You began back at JP Morgan Chase when they were

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Speaker 1: really a much smaller shop. Weren't they, Yes, Yes, down

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Speaker 1: on Water Street, one Water Street, right across in the

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Speaker 1: Staten Island Ferry. What was yeah? What were they like

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Speaker 1: then and what was your role with them? Sure? So

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Speaker 1: I graduated with a management degree concentration and finance. I

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Speaker 1: went into a sort of global training program with them. Certainly,

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Speaker 1: you know much smaller at the time, you know, still

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Speaker 1: very regionally based. Um. You know, the the project that

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Speaker 1: I was working on is really how to define profitability

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Speaker 1: for their different product lines. Um. But I got a

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Speaker 1: chance very early in my career to travel abroad too.

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Speaker 1: I lived in Paris, I lived in London, and lived

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Speaker 1: in Milan, Madrid, Frankfurt, doing cost studies with country managers

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Speaker 1: and then making a recommendation to you know, either d

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Speaker 1: market a product or or you know, sort of focus

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Speaker 1: in a particular area. And so I was definitely over

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Speaker 1: my skis. Looking back, I don't know that I knew

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Speaker 1: really what I was doing, but I certainly learned a lot. Well,

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Speaker 1: this is was just right out of grad school. They

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Speaker 1: start sending you this was right out of undergrad. Yes,

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Speaker 1: right out of undergrad So I was young. Yeah, yeah,

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Speaker 1: but you have to work really hard the first year

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Speaker 1: and then you know sort of um, you know, compete

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Speaker 1: to go overseas. So thankfully, you know, I've never been

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Speaker 1: showed a hard work and so they you know, gave

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Speaker 1: me the opportunity and I jumped at it. So you

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Speaker 1: go from Chase to Wharton, where do you go? So

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Speaker 1: my undergrads from University of Delaware Wharton is my um

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Speaker 1: my certified Investment Management Analyst designation, that's right. And so

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Speaker 1: where did you go from from upen? Uh so? So

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Speaker 1: then I just went straight into Chase, right, So I

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Speaker 1: started my career in global banking, then moved into brokerage,

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Speaker 1: then sset manager. Yeah so alright, so then you go

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Speaker 1: from how how do you end up in black Rock

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Speaker 1: right in the middle of the entire build out of

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Speaker 1: ice Share. Yeah, yeah, that was fun. That was right

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Speaker 1: after Larry Fink bought b G. I so right, I

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Speaker 1: think that deal closed December two thousand nine. And look,

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Speaker 1: you know, I certainly have an appreciation, a broad appreciation

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Speaker 1: for financial services in general, because my journey and career

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Speaker 1: progression was, like I said, global banking, wealth management, brokerage platforms.

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Speaker 1: Really sure, some Leman brothers up through what is now

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Speaker 1: called Morgan Stanley UM, and then I went into asset management,

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Speaker 1: always on the active or fundamental active side, right, which

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Speaker 1: is what people like you and I grew up with

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Speaker 1: the mutual fund. But what really drove me crazy at

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Speaker 1: Alliance Bernstein was that we would go into an institutional presentation. Right,

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Speaker 1: so you've got the committee there, you've got the chief

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Speaker 1: investment officer and would be trying to sell whatever strategy,

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Speaker 1: and invariably, probably fifty percent of the time, we would

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Speaker 1: lose to b G I Northern Trust State Street because

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Speaker 1: of a passive mandate. And you know what I was

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Speaker 1: trying to articulate to the chief investment officer is that

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Speaker 1: the real prudent way to run the pension fund, as

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Speaker 1: an example, is to figure out how to combine intelligent

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Speaker 1: alpha with efficient beta so that there's really room for

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Speaker 1: both of us. So what again, intellectually stuck in my

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Speaker 1: brain is I cannot really as a practitioner talk about

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Speaker 1: the indexed enhanced index or beta side of the business.

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Speaker 1: And so I got a call from a recruiter, James Beck,

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Speaker 1: wonderful recruiter here in New York City, and they had

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Speaker 1: a position at I Shares And I loved Alliance Bernstein

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Speaker 1: Loos Andrews, especially as a leader. Was was just a legend.

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Speaker 1: They had such a fabulous research group, especially in the

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Speaker 1: nineties right into the tie absolutely and Bernstein plus Alliance

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Speaker 1: was sort of like boom right. It was just a

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Speaker 1: fabulous combination. So I never thought I would leave, but

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Speaker 1: this I had this nagging thing in my brain intellectually

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Speaker 1: as a professional that I needed to satisfy. I needed

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Speaker 1: to be able to talk about both sides of the

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Speaker 1: investment management industry again as as a professional. So that's

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Speaker 1: really why I went, and I gotta tell you, And

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Speaker 1: of course I got you know, I got grilled, and

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Speaker 1: everybody said to me, oh, you're going to the dark side,

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Speaker 1: And I guess I suppose I did, But I did it,

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Speaker 1: you know, deliberately. Well, by dark side you mean more

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Speaker 1: efficient and lower cost or dark side just the company

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Speaker 1: dark side anything passive right from fundamental active into the

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Speaker 1: dark side of indexing. If you were, you were dead

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Speaker 1: right when you say they're not mutually exclusive, they're complementary.

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Speaker 1: And I don't understand why people, I guess when you're

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Speaker 1: losing business and we've seen the flows have just been

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Speaker 1: when you started at I Shares, did you ever imagine

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Speaker 1: Vanguard would be five trillion, black Rock would be six trillion,

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Speaker 1: and a decade of flows would shift from active to

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Speaker 1: passes the way we've seen. No, I really didn't, And

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Speaker 1: and look, you and I both know that. I think

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Speaker 1: two thousand and eight really propelled that forward dramatically. But

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Speaker 1: but when I joined I shares Vanguard and State three.

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Speaker 1: We're certainly a of I shares in terms of the

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Speaker 1: league tables, but I shows came on strong. And one

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Speaker 1: of the big strategic moves that I Share has made,

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Speaker 1: and this is right when Mark Weedman took over in

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Speaker 1: two thousand and eleven, maybe nine months after, is they

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Speaker 1: you know, they were losing the core positions to Vanguard,

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Speaker 1: right they were, they were being relegated to the satellites,

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Speaker 1: and so they came out with the core series right

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Speaker 1: sort of replicating Vanguard's core products at a lower phase,

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Speaker 1: and that was a big game change. I mean, certainly

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Speaker 1: us m V, which rivalist SPLV and had a better construction,

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Speaker 1: took a lot of assets in low vall. So they

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Speaker 1: you know, they really made a lot of good strategic moves.

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Speaker 1: I'm fascinated by Larry Fink in two thousand and nine,

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Speaker 1: when everybody is still stinging from the g f C

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Speaker 1: from the financial crisis, says, no, No, now is the

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Speaker 1: time when we're going to make a giant purchase and

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Speaker 1: totally reformulate the firm. That is one of the great

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Speaker 1: all time pivots in history. And if you recall the

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Speaker 1: time everyone thought, oh, my gosh, he's totally overpaying b

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Speaker 1: everybody's laughing. He's laughing all his way to the bank.

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Speaker 1: And now they are literally the biggest shop in the world. So,

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Speaker 1: so you were there at a time when the growth

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Speaker 1: was really rampant. What was that experience like? So here's

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Speaker 1: how I described in many of us who have been

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Speaker 1: at I Shares and have since left and gone on

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Speaker 1: to really wonderful things. It's like going to boot camp

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Speaker 1: for the Special Forces. I knew you were going to

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Speaker 1: use that metaphor because I've attended a number of conferences

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Speaker 1: where you and I have both spoken, and that crew

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Speaker 1: of E T F people all seem to have gone

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Speaker 1: through the same baptism of fire. It's absolutely fair. Again,

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Speaker 1: if you have anybody else in your show who's who

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Speaker 1: was there for a period of time and left, we

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Speaker 1: all say wonderfully positive things about the experience. And I

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Speaker 1: mean that so genuinely, because every single day you are

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Speaker 1: walking into battle, the bar is set so high for

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Speaker 1: everything that you have to achieve, and Refin's expectations are real.

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Speaker 1: They they they are quite lofty for everybody, and so

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Speaker 1: you know, you really sharpen your skill set that when

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Speaker 1: you get out. You get out like you are a

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Speaker 1: Green Beret or a Navy seal or recall it what

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Speaker 1: you will, right, So therefore you are very hirable. People

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Speaker 1: love to take people from black Rock now difficult culture

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Speaker 1: because of that. Um. But you know, I absolutely look

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Speaker 1: back at that time in my life as a wonderful experience.

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Speaker 1: That's shaped a lot of who I am today. And

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Speaker 1: the proof is how successful they've become. Whatever they're doing,

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Speaker 1: it seems to be working. Yeah, I'm very hults. You're

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Speaker 1: listening to Master's in Business on Bloomberg Radio. My special

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Speaker 1: guest today is Sharon French. She is the head of

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Speaker 1: Beta Solutions at Oppenheimer Funds, where she oversees smart beta

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Speaker 1: products as well as E s G efforts. Um, before

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Speaker 1: we move on to what you're currently doing in Oppenheimer,

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Speaker 1: I have one last black Rock quest Shin. So you

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Speaker 1: were head of private Clients and Institutions at Black Rock.

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Speaker 1: What did that work entail on a day to day basis?

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Speaker 1: What were you basically in branding and marketing or were

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Speaker 1: you front line dealing with c I O S and

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Speaker 1: investment committee front line? Good question? Um? Uh yeah, so

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Speaker 1: it so institutional, which was also a responsibility of mine

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Speaker 1: out of lines Bernstein so institutional and private banks. So

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Speaker 1: you know, we certainly dealt with JP Morgan private bank

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Speaker 1: quite a bit, and a lot of the others Wills, Fargo, etcetera,

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Speaker 1: you know them well, UM and so it was it

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Speaker 1: was really a strong product development client fit role at

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Speaker 1: that time that the the I shares you know, product

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Speaker 1: lineup if you will, was growing pretty dramatically, but it

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Speaker 1: was very closely connected and linked to certain channels. So

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Speaker 1: the channel that I fail exactly now they're they're pure

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Speaker 1: beta you know index stuff, you know, the um some

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Speaker 1: institutional kinds for using as trading vehicles, but they certainly

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Speaker 1: were looking to get away from that specifically within smart

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Speaker 1: beta first trust was coming up very fast in the

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Speaker 1: in the sort of rear view mirror at the time UM,

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Speaker 1: so we had to sort of pivot and balance between

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Speaker 1: our our pure beta market cap strategies, which is really

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Speaker 1: where they started into how do we tilt a particular

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Speaker 1: product more fundamentally, and a lot of the feedback that

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Speaker 1: we were getting for that product development was driven exactly

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Speaker 1: from some of the private banks that we worked with

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Speaker 1: in some of the larger institutions quite interesting. So let's

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Speaker 1: talk about beta solutions, which is kind of a mouthful

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Speaker 1: to instead of just saying beta. So let me just

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Speaker 1: start with the obvious question, what's the difference between Beta

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Speaker 1: solutions and basic index? And yeah, well so, and there's

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Speaker 1: a reason why it's called that. So, yeah, right when

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Speaker 1: I was hired to Oppenheimer Funds, it was a very

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Speaker 1: deliberate decision Artstime as the CEO, to really, you know,

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Speaker 1: commit and go full force into the E T F

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Speaker 1: business utilizing smart Beta, taking a pass on market cap

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Speaker 1: because there's certainly big players who you know, corner that market.

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Speaker 1: Hard hard to add value there if you're smaller or

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Speaker 1: even a mid sized player, that right, That's right, And

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Speaker 1: so he sort of wanted to call the unit. So

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Speaker 1: it's a this is a sort of a a independently run,

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Speaker 1: if you will, operating unit within Oppenheimer Funds, which gives

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Speaker 1: us the space and the focus and the commitment to

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Speaker 1: sort of build our business alongside of our active business.

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Speaker 1: But he wanted to call it smart Beta, and I said,

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Speaker 1: you know, is that really what we're trying to do,

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Speaker 1: aren't we Aren't we trying to take a beta concept

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Speaker 1: and wrap it in whatever it makes sense to wrap

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Speaker 1: it in, whether it's an et F fund, a separate

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Speaker 1: account and use it. So shouldn't this be called beta solutions?

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Speaker 1: Because if we are pigeonholing ourselves just into smart beta.

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Speaker 1: And you know, for the longest time people really know

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Speaker 1: what smart data was. It had all kinds of names, strategic, beta, alternative, veta,

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Speaker 1: de menal, indexing exactly, probably the most descriptive. Are you

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Speaker 1: on the side of the fence that thinks the phrase

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Speaker 1: smart data is a marketing term? I am on that

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Speaker 1: side of the film. You're you're not a fan of that.

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Speaker 1: I know a lot of people just cringe every time

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Speaker 1: here because if you think about it, if beta is

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Speaker 1: just what the market's giving you, what is how you

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Speaker 1: modifying that with smart? I like alternatively weighted right, because

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Speaker 1: I think of I think of buying the market right,

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Speaker 1: which is market cap and certainly favors certain stocks or sectors,

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Speaker 1: which you know, there's always been concentration risk in that approach.

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Speaker 1: Some people still want it, which is fine, but there's

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Speaker 1: better ways and different choices on how to drive that

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Speaker 1: risk return profile through alternatively waiting the index. And I

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Speaker 1: really do believe that I remember way back when. I

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Speaker 1: think it was Guggenheim who had the equal weighted that's

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Speaker 1: and that was suddenly like, wow, so you don't have

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Speaker 1: the market cap weighted. It was never giants, although it

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Speaker 1: certainly has grown, but it was always home. You mean,

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Speaker 1: there's a different way to do this. It's kind of

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Speaker 1: surprising that the smart beta move hadn't begun earlier because

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Speaker 1: people were clearly thinking about ways to look at indexing

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Speaker 1: that wasn't just cap weight That's right. And what I'm

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Speaker 1: really encouraged by Barry is that if you look at

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Speaker 1: flows in teen versus eighteen, smart beta, of the total

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Speaker 1: pie of et F flows was about twelve pen it was.

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Speaker 1: That's giant. It seems to have plateaus somewhat now, right

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Speaker 1: or is it still growing? It's still growing. Yeah, it's

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Speaker 1: still growing some of the well, you know, I mean

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Speaker 1: this year, I mean, I haven't seen April numbers yet,

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Speaker 1: but it's it's haund pretty healthy growth this year, you

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Speaker 1: know that. And I know that it's over whether it

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Speaker 1: will double. I mean, it's it doubled. From whether it

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Speaker 1: will double, that's that's a bit of a stretch. But

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Speaker 1: the point of the matter is we knew we would

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Speaker 1: get smart beta market share from three places. The first

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Speaker 1: is underperforming active and you know sort of morning star

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Speaker 1: one and two star rated funds. We certainly saw it there. Um,

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Speaker 1: the just the sheer growth of smart Beta trying to

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Speaker 1: get our unfair share of that. And that's the growth

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Speaker 1: I'm talking about from eighteen doubling and then passive. So

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Speaker 1: as people got more educated about the merits of alternatively

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Speaker 1: weighted some of the you know, uh, sort of traditional

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Speaker 1: passive buyers started to move towards and understand what they

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Speaker 1: were getting by paying in some cases twenty basis points

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Speaker 1: more to get a smart beta product. They started to

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Speaker 1: move parts of their portfolio to smart beta from having

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Speaker 1: it be all passive. So there were three pillars by

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Speaker 1: which we gathered market share, and we're about five billion

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Speaker 1: today and from our our start with it's about so

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Speaker 1: we're pretty happy with. So let's since you brought that up,

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Speaker 1: let's talk about what Oppenheimer's portfolio options look like. So

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Speaker 1: you have the alternative way thing you're saying billion, what

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Speaker 1: are the other et F offerings they have in either

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Speaker 1: the beta or the non beta opportunities? Sure? Sure, So

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Speaker 1: we have twenty equity strategies. UM starting out with revenue

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Speaker 1: weighted revenue weighted, so that's a traditional smart beta fundamental.

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Speaker 1: It is absolutely yeah, and that is due to a

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Speaker 1: small acquisition we made back at the end of of

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Speaker 1: revenue shares. UM really kept five of those products and

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Speaker 1: then built that suite out and then we started to

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Speaker 1: move into factors and we've got a really nice partnership

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Speaker 1: with Fitsie Russell. We introduced Dynamic multi factor, which we're

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Speaker 1: super proud of. We were one of the first us

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Speaker 1: in PIMCO. So this is an active no, it's it

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Speaker 1: well interesting we have it's sort of an active overlay.

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Speaker 1: So it's a macro signal coming from our global multi

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Speaker 1: Asset group which takes UM sort of leading economic indicators

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Speaker 1: as well as the sort of the momentum signals from

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Speaker 1: the market and tells us monthly whether we're either in

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Speaker 1: a recovery, an expansion, a contraction or a slowdown. And

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Speaker 1: then we take the five factors and we wait them

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Speaker 1: depending upon which market regime we're in, and so based

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Speaker 1: on that you will alter within the e t F

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Speaker 1: the waiting of the So it is rules based, but

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Speaker 1: it is informed by this active signal and it has

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Speaker 1: done phenomenal. We launched it in November. It's at the

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Speaker 1: top of the category. So this is kind of an

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Speaker 1: interesting space because people have been talking about making its

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Speaker 1: ironic how beta has driven so much of e t

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Speaker 1: f s, but we're talking about making e t fs

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Speaker 1: more dynamic and more active based on a variety of

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Speaker 1: other inputs. So this one is rules based, driven by

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Speaker 1: a series of economic inputs. Any other dynamic or active

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Speaker 1: ETFs current or on the rise well, interestingly, so we

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Speaker 1: did file with the SEC for a senior loan product.

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Speaker 1: We've got a very very well recognized and successful senior

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Speaker 1: loan FRANX fixed income right, so so we were making

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Speaker 1: our foray into the fixed income marketplace. We also filed

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Speaker 1: for short duration uh e t F some liquidity enhanced

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Speaker 1: ETFs and all these are not to a specific index.

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Speaker 1: The role dynamic and can change. Well, these are actually active.

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Speaker 1: So what we're doing is filing active fixed income ETFs

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Speaker 1: with some of our key teams and Oppenhammer funds. And

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Speaker 1: had we not been bought by Investco, because those products

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Speaker 1: are just sitting on the shelf, those approvals by the

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Speaker 1: SECO sitting on the shelf, we would have launched fixed

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Speaker 1: income active UM just sort of you know, build out

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Speaker 1: the asset allocation sure and all the academic research says

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Speaker 1: that while active may not necessarily create a lot of

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Speaker 1: value in the equity side, it really can create value

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Speaker 1: unfixed income. It does absolutely, and I think you know,

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Speaker 1: firms who are thinking about that should really look at

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Speaker 1: sort of what are some of their core competencies on

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Speaker 1: the fixed income side. Certainly we've seen you know, Gunlock

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Speaker 1: and Gross do well with the products when they came out,

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Speaker 1: and they're sort of leading the fixed don't come active

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Speaker 1: ETF space, But we really believe that that there's something

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Speaker 1: in that for investors. I think the jury is still

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Speaker 1: out on the equity side. I mean we saw the

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Speaker 1: big you know, Presidian approval that was a big development

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Speaker 1: a couple of weeks ago. I'm not familiar with that ETF.

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Speaker 1: What was the um. The company is Prosidian, and they

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Speaker 1: have been working with the SEC to try to get

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Speaker 1: an approval for a non transparent solution. Quite quite interesting.

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Speaker 1: I'm very ritults. You're listening to Masters in Business on

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Speaker 1: Bloomberg Radio. My special guest today is Sharon French. She

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Speaker 1: is the head of Beta Solutions, for Oppenheimer Funds. She

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Speaker 1: also covers environmental, social and governance efforts at the firm.

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Speaker 1: She is a graduate of the Wharton School of Business

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Speaker 1: and sits on the board of Women in ETFs. So,

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Speaker 1: so let's talk about what's going on, um with women

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Speaker 1: in the E t F space. Tell us a little

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Speaker 1: bit about Women in E t F the board that

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Speaker 1: you're on, uh, and what is that group about and

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Speaker 1: what are they looking to accomplish. Yeah, I would love

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Speaker 1: to talk about that. Thank you for the question. So

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Speaker 1: I'm co president with Jillian del Signore JP Morgan of

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Speaker 1: Women in E t F. So I have been a

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Speaker 1: global governance committee and board members since the beginning. Um,

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Speaker 1: how long has this been around? For just over five years?

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Speaker 1: We just hit our five year anniversary in January. That's decent,

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Speaker 1: you know these days, five years just for something to

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Speaker 1: survive and grow is not a bit. And I have

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Speaker 1: to tell you we are growing so fast. We're global. Um.

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Speaker 1: So we're in a May as well as Asia, pack

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Speaker 1: and Canada. Um, We've got ten chapters, were just about

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Speaker 1: to hit five thousand members globally. That's fantastic. And this Verry,

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Speaker 1: this hit at the heart of what I really think

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Speaker 1: is needed within the e t F industry. There are

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Speaker 1: women of Wall Street, there are women in hedge funds. UM.

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Speaker 1: But this was really something that we heard a lot,

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Speaker 1: as we believe, but within financial services there are a

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Speaker 1: lot of women gravitate to the e t F ecosystem,

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Speaker 1: whether you're an AUTHORIIC participant. We have really drilled down

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Speaker 1: with some theories on this, but we would love to

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Speaker 1: get a research partner to prove it. Well, let me

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Speaker 1: man explain this to you, okay please, But UM, we

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Speaker 1: think it's innovation. We think women are very drawn to

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Speaker 1: innovation and UM evolution. Um, there's a lot of women

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Speaker 1: in supporting the e t F industry on the legal side.

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Speaker 1: There's a lot on the trading side, especially authorized participants

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Speaker 1: and market makers. You and I know many of them. Um.

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Speaker 1: There are a lot of women leading e t F businesses. Uh.

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Speaker 1: There are a lot of women in e t F distribution.

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Speaker 1: Again like my co president Jillian del Signore over at

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Speaker 1: JP Morgan. UM, there are also you know heads of products.

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Speaker 1: I mean, uh, they're the head of uh the e

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Speaker 1: t F business at JP Morgan. Also used to be

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Speaker 1: the head of product both at I Shares and and

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Speaker 1: JP Morgan. So so there is just a huge concentration

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Speaker 1: of women within the E T F industry that we

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Speaker 1: felt a need to get connected. So our mission is

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Speaker 1: to connect, support and inspire UM. So it's really having

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Speaker 1: some of the more senior executives within ETFs mentor and

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Speaker 1: sponsor and connect the women who are joining us who

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Speaker 1: are just starting out in the industry UM. And we

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Speaker 1: have events all over the world and by the way,

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Speaker 1: we do encourage men. Uh they're a well over ten

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Speaker 1: percent of our membership as men. We're hoping to get

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Speaker 1: it up to because we are trying to continue to

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Speaker 1: push forward the agenda of gender equality and the diversity

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Speaker 1: of thought. And so one of our big things that

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Speaker 1: we do every International Women's Day is ring the bell

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Speaker 1: at every stock exchange around the world with the Sustainable

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Speaker 1: Stock Exchange in the u N And that's a fabulous, fabulous,

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Speaker 1: high profile way to promote gender equality within the ecosystem.

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Speaker 1: And it's our five year anniversaries, so we're gonna be

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Speaker 1: doing events both in UH Hong Kong, San Francisco, Chicago,

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Speaker 1: New York, and Toronto. So it's funny you mentioned five years.

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Speaker 1: July will be five years that this show has been around,

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Speaker 1: And when I was first beginning and was able to

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Speaker 1: wrestle up a female guest, one of the questions was

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Speaker 1: always something corny, like, so what's it like being a

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Speaker 1: gallon of man's industry? And I'm being a little sarcastic,

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Speaker 1: and I'm thrilled that I get to ask a question.

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Speaker 1: So tell us about how you're driving the growth of

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Speaker 1: E t F. You can see just over the past

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Speaker 1: five years how much things have have changed. It's really

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Speaker 1: so different. And I'm curious. Do you think it's the

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Speaker 1: fact that the E t F space was so new

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Speaker 1: you did not have that sclerotic old boys network cemented

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Speaker 1: in place. It was easier to um breakthrough into that

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Speaker 1: space without the usual obstacle. I think that's very valid.

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Speaker 1: I think that's a very big part of it. I mean, look,

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Speaker 1: I you know, I've been around for over thirty years,

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Speaker 1: so I did grow up in the environment exactly um,

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Speaker 1: and you know you sort of because of of that,

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Speaker 1: you know, for me personally, I've sort of become teflon

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Speaker 1: coded because you needed to be. But you you know,

429
00:24:24,480 --> 00:24:27,880
Speaker 1: now it's much more supportive. I mean, the industry has changed.

430
00:24:27,880 --> 00:24:31,200
Speaker 1: I do have to say glacially it is better today,

431
00:24:31,320 --> 00:24:33,200
Speaker 1: but I would have preferred it to be in leaps

432
00:24:33,320 --> 00:24:36,399
Speaker 1: and strides. But um, but but whether it's you know,

433
00:24:36,640 --> 00:24:40,119
Speaker 1: women on Wall Street, the Financial Women's Association, hundred women's

434
00:24:40,119 --> 00:24:42,800
Speaker 1: in Hedge Funds, women in ETFs, I mean there's now

435
00:24:43,040 --> 00:24:49,439
Speaker 1: organizations that have a genuine interest in continuing to promote women. UM,

436
00:24:49,760 --> 00:24:51,879
Speaker 1: give them the tools and resources in order to to

437
00:24:51,960 --> 00:24:56,159
Speaker 1: advocate for themselves, negotiate for a job or a better raise. Um.

438
00:24:56,320 --> 00:24:59,000
Speaker 1: We have a speakers Bureau, So we have a lot

439
00:24:59,119 --> 00:25:01,680
Speaker 1: of people in media like you tell us about the

440
00:25:01,720 --> 00:25:06,760
Speaker 1: speakers because um, I introduced them to one of the

441
00:25:06,800 --> 00:25:09,920
Speaker 1: women who worked for me who actually speaks all around

442
00:25:09,960 --> 00:25:14,440
Speaker 1: the world then is highly sought after speaker, Blair Ducasney.

443
00:25:14,600 --> 00:25:18,359
Speaker 1: She started working with the Speakers Group who put together

444
00:25:19,320 --> 00:25:21,840
Speaker 1: Yes Yes, so thank you and look, we're we're sort

445
00:25:21,840 --> 00:25:24,920
Speaker 1: of spoon feeding the media who are are are having

446
00:25:25,000 --> 00:25:28,240
Speaker 1: a hard time finding female speakers. So Elizabeth Kashner at

447
00:25:28,280 --> 00:25:31,679
Speaker 1: fact Set and Linda Jang with she has her own firm, Purview,

448
00:25:32,480 --> 00:25:34,240
Speaker 1: we talked a lot about it and that's what we

449
00:25:34,280 --> 00:25:36,239
Speaker 1: do women as we just get it done. So they

450
00:25:36,320 --> 00:25:38,119
Speaker 1: came together and they reached out to everybody, and you

451
00:25:38,200 --> 00:25:39,840
Speaker 1: have to you have to apply, and you have to

452
00:25:39,920 --> 00:25:43,880
Speaker 1: be qualified in certain topics and media trained in order

453
00:25:43,920 --> 00:25:45,479
Speaker 1: to be part of our speakers. Beer, I think we're

454
00:25:45,560 --> 00:25:47,400
Speaker 1: up to Linda last set on our Lastkoll, I think

455
00:25:47,400 --> 00:25:50,720
Speaker 1: we're up to forty, you know, professionals who are you know,

456
00:25:51,000 --> 00:25:53,639
Speaker 1: very well experienced in certain key segments of the market.

457
00:25:54,000 --> 00:25:56,119
Speaker 1: So we're taking this list and we're giving it to

458
00:25:56,200 --> 00:25:58,720
Speaker 1: people like you. We're giving it to inside ets, We're

459
00:25:58,760 --> 00:26:01,000
Speaker 1: giving it to Tom i'd a e t of trends.

460
00:26:01,040 --> 00:26:04,160
Speaker 1: We're giving it to whoever needs female speakers to try

461
00:26:04,280 --> 00:26:07,880
Speaker 1: to get a more diversity of thought and equal representation

462
00:26:08,560 --> 00:26:10,760
Speaker 1: in the media. I won't I won't mention the group,

463
00:26:10,840 --> 00:26:13,720
Speaker 1: but there was an article not too long ago about

464
00:26:13,760 --> 00:26:18,320
Speaker 1: a conference and the photo is the panel on diversity

465
00:26:18,560 --> 00:26:21,960
Speaker 1: and it's six white dudes, and it's pretty Hey, listen,

466
00:26:22,040 --> 00:26:24,600
Speaker 1: you guys, really you gotta make a little bit more

467
00:26:24,640 --> 00:26:27,080
Speaker 1: of an effort. Then, look, I found six white guys.

468
00:26:27,200 --> 00:26:29,520
Speaker 1: Let's let's have a that that one I know exactly

469
00:26:29,560 --> 00:26:31,960
Speaker 1: which one you're talking about. That won't happen again, But again,

470
00:26:32,119 --> 00:26:35,600
Speaker 1: we did you guys tag them and say, oh, absolutely idiots,

471
00:26:35,960 --> 00:26:39,359
Speaker 1: absolutely didn't. It's kind of embarrassing. It is. It's embarrassing

472
00:26:39,520 --> 00:26:43,359
Speaker 1: on diversity. I might be exaggerating slightly, but the photo

473
00:26:43,440 --> 00:26:45,600
Speaker 1: I saw it was like, what, Yes, No, that's gotta

474
00:26:45,680 --> 00:26:47,200
Speaker 1: be the you know, how to raise money for a

475
00:26:47,240 --> 00:26:52,040
Speaker 1: hedge fund or something else, male dominated type of a panel.

476
00:26:52,119 --> 00:26:54,280
Speaker 1: That was pretty hilarious. Yeah, and so sometimes you just

477
00:26:54,359 --> 00:26:56,080
Speaker 1: need to take action. That's what we did. We have

478
00:26:56,520 --> 00:26:59,160
Speaker 1: the list of forty women and growing, so depending upon

479
00:26:59,240 --> 00:27:01,440
Speaker 1: the topic, we certainly will have three to five women

480
00:27:01,480 --> 00:27:04,600
Speaker 1: to choose from. That. That makes a whole lot of sense.

481
00:27:05,200 --> 00:27:07,960
Speaker 1: I'm Barry Hults. You're listening to Master's in Business on

482
00:27:08,040 --> 00:27:11,440
Speaker 1: Bloomberg Radio. My extra special guest this week is Sharon French.

483
00:27:11,920 --> 00:27:16,240
Speaker 1: She runs the Beta Solutions group at Oppenheimer Funds. Let's

484
00:27:16,359 --> 00:27:21,000
Speaker 1: talk a little bit about environmental, social, and governance investing.

485
00:27:21,119 --> 00:27:24,160
Speaker 1: What I keep hearing is we're on the leading edge

486
00:27:24,200 --> 00:27:29,320
Speaker 1: of a thirty plus trillion dollar generational wealth transfer um.

487
00:27:29,680 --> 00:27:33,000
Speaker 1: Millennials and women are the people most interested in investing

488
00:27:33,600 --> 00:27:37,520
Speaker 1: in the environment and social based clauses, and yet the

489
00:27:37,600 --> 00:27:41,880
Speaker 1: pickup has been so slow. What do you make of that? Yeah,

490
00:27:42,040 --> 00:27:44,320
Speaker 1: and if you look at the numbers in retail in

491
00:27:44,400 --> 00:27:47,480
Speaker 1: the US, right, so you always have to peel the onion. Uh,

492
00:27:47,840 --> 00:27:52,200
Speaker 1: the adoption has been slow within what I call the

493
00:27:52,240 --> 00:27:57,200
Speaker 1: sustainable investing universe to really understand why that is. And

494
00:27:57,320 --> 00:27:59,919
Speaker 1: by the way, this is the first really trend if

495
00:28:00,000 --> 00:28:02,720
Speaker 1: you want to call it a trend um where the

496
00:28:03,200 --> 00:28:07,520
Speaker 1: growth outside the US is really driving it. So it's

497
00:28:07,600 --> 00:28:12,880
Speaker 1: typically there's big pension funds within the Nordics, within Europe

498
00:28:13,000 --> 00:28:18,480
Speaker 1: or a MIA um so institutionally in Amia driving a

499
00:28:18,560 --> 00:28:21,200
Speaker 1: lot of the adoption. There is a very high expectation

500
00:28:21,320 --> 00:28:24,000
Speaker 1: in some cases of mandate that you have to have

501
00:28:24,160 --> 00:28:27,480
Speaker 1: a very well thought out E s G process within

502
00:28:27,560 --> 00:28:31,359
Speaker 1: your portfolio management structure. Is it a specific percentage or

503
00:28:31,440 --> 00:28:35,080
Speaker 1: is it just it's it's most of the market institutional

504
00:28:35,160 --> 00:28:37,440
Speaker 1: outside the U S. Yes, of the eight trillion or

505
00:28:37,480 --> 00:28:40,240
Speaker 1: so that's in that market today, most of his institutional

506
00:28:40,280 --> 00:28:42,840
Speaker 1: outside the U S. So, as you know, most of

507
00:28:42,880 --> 00:28:44,920
Speaker 1: the growth is driven by the US, and the adoption

508
00:28:45,000 --> 00:28:49,240
Speaker 1: happens usually in a Midia first and Asian Europe, Middle

509
00:28:49,280 --> 00:28:56,160
Speaker 1: East and UM Africa. So Europe pension funds specifically driving

510
00:28:56,320 --> 00:28:59,360
Speaker 1: deeper in the Nordics is what's driving the overall global

511
00:28:59,440 --> 00:29:03,400
Speaker 1: growth of stainable investing in the US, there has been

512
00:29:03,680 --> 00:29:07,360
Speaker 1: a legacy understanding that we're trying to unwind with s

513
00:29:07,480 --> 00:29:11,600
Speaker 1: RI I. So SRI I socially responsible in exactly, but

514
00:29:11,760 --> 00:29:14,680
Speaker 1: it's been sort of the days of Calvert where it

515
00:29:14,960 --> 00:29:23,960
Speaker 1: is exclusionary investing, the broad index, they screen out whatever

516
00:29:24,000 --> 00:29:27,720
Speaker 1: it happens, that's exactly right, and therefore they when you

517
00:29:27,840 --> 00:29:31,640
Speaker 1: carve out big segments of the market, in many cases,

518
00:29:31,760 --> 00:29:34,880
Speaker 1: not all, but many cases, it impacts performance. So it

519
00:29:35,000 --> 00:29:39,360
Speaker 1: has sort of has this negative um inertia attached to

520
00:29:39,480 --> 00:29:42,640
Speaker 1: it that has really evolved. So that's one end of

521
00:29:42,680 --> 00:29:46,440
Speaker 1: the spectrum, that's right. The middle part is E s

522
00:29:46,520 --> 00:29:50,160
Speaker 1: G investing or e s G integration, and what that

523
00:29:50,440 --> 00:29:54,240
Speaker 1: is is looking at the environmental, social, and governance factors

524
00:29:54,280 --> 00:29:58,400
Speaker 1: that impacts a corporation using that within a portfolio manage

525
00:29:58,640 --> 00:30:02,240
Speaker 1: management process. So they really called the intangibles, typically look

526
00:30:02,280 --> 00:30:06,960
Speaker 1: at the tangible balance sheet right financial metrics. Adding to that,

527
00:30:07,120 --> 00:30:10,520
Speaker 1: the intangibles really tells you and gives you a full

528
00:30:10,600 --> 00:30:15,040
Speaker 1: picture of how the firm is run. Um also exposes

529
00:30:15,120 --> 00:30:18,960
Speaker 1: you to some potential areas of vulnerability or risk. So

530
00:30:19,280 --> 00:30:22,240
Speaker 1: E s G integration within a portfolio management process is

531
00:30:22,280 --> 00:30:26,000
Speaker 1: a great risk management tool. I've heard a number of people,

532
00:30:26,200 --> 00:30:28,240
Speaker 1: in fact, that some of the events we both attended

533
00:30:28,280 --> 00:30:32,120
Speaker 1: together talk about E s g as being misunderstood, that

534
00:30:32,240 --> 00:30:36,120
Speaker 1: it's really a fundamental screening method to look for risk

535
00:30:36,480 --> 00:30:39,720
Speaker 1: and control for it for And the perfect example was

536
00:30:40,920 --> 00:30:43,560
Speaker 1: a lot of companies that have no diversity, no women

537
00:30:43,600 --> 00:30:46,239
Speaker 1: on their boards, very little women management. Oh and they

538
00:30:46,360 --> 00:30:50,120
Speaker 1: managed to get caught in the me too UM debacle

539
00:30:50,440 --> 00:30:56,080
Speaker 1: self self inflicted wounds. What a coincidental correlation or apparently

540
00:30:56,600 --> 00:30:59,240
Speaker 1: not right? That that's a fundamental screen isn't it? That

541
00:30:59,400 --> 00:31:02,040
Speaker 1: is absolutely right? The other sort of common ones are

542
00:31:02,160 --> 00:31:06,560
Speaker 1: you know, the Volkswagen example with its emissions issues scandal

543
00:31:06,760 --> 00:31:09,400
Speaker 1: that absolutely could have been uncovered if you start to

544
00:31:09,480 --> 00:31:12,920
Speaker 1: really dig deeper into some of their governance practices. Um

545
00:31:13,120 --> 00:31:15,360
Speaker 1: in some cases with some of the oil companies that

546
00:31:15,440 --> 00:31:18,720
Speaker 1: have been notable to oil spills. So you know that

547
00:31:18,840 --> 00:31:23,200
Speaker 1: really all of them though, can you screen for preventing oils?

548
00:31:23,960 --> 00:31:27,160
Speaker 1: You can screen for practices, right, so some have more

549
00:31:27,320 --> 00:31:30,960
Speaker 1: robust practices than others. Right, So would would you exclude

550
00:31:30,960 --> 00:31:33,600
Speaker 1: a company from your portfolio or would you overweight another

551
00:31:33,680 --> 00:31:37,480
Speaker 1: that you feel is more robust and and more tightly controlled,

552
00:31:38,120 --> 00:31:42,120
Speaker 1: so you know, the and then the the further on

553
00:31:42,240 --> 00:31:45,880
Speaker 1: the spectrum is impact investing. So impact investing is taking

554
00:31:46,600 --> 00:31:50,680
Speaker 1: a particular cause that you believe in rainforest in Sudan,

555
00:31:50,960 --> 00:31:56,960
Speaker 1: carbon emissions, very sort of narrowly focused, and and waiting

556
00:31:57,000 --> 00:32:00,280
Speaker 1: the portfolio towards that or buying just that. So you know,

557
00:32:00,360 --> 00:32:03,600
Speaker 1: a lot of private equity money is directed towards impact investing.

558
00:32:03,760 --> 00:32:05,960
Speaker 1: So so again if you look at the spectrum, you

559
00:32:06,000 --> 00:32:09,440
Speaker 1: have s R I and exclusionary on one side, which

560
00:32:09,480 --> 00:32:12,360
Speaker 1: again has been sort of fallen out of favor. Is

561
00:32:12,360 --> 00:32:14,280
Speaker 1: that well, I mean, I think there's just a better

562
00:32:14,400 --> 00:32:16,920
Speaker 1: understanding that people believe that there's a better way to

563
00:32:17,000 --> 00:32:19,760
Speaker 1: do it right. So and then there's the s G integration,

564
00:32:19,840 --> 00:32:21,840
Speaker 1: which was where a lot of the people in US

565
00:32:21,920 --> 00:32:25,280
Speaker 1: retail are focused, including us. And then there's impact investing,

566
00:32:25,320 --> 00:32:28,280
Speaker 1: which we actually have a company that we bought that

567
00:32:28,360 --> 00:32:32,080
Speaker 1: does custom municipal portfolios and we allow them to do

568
00:32:32,200 --> 00:32:37,840
Speaker 1: an impact overlay on that custom income fixed income. Really yes,

569
00:32:38,120 --> 00:32:41,800
Speaker 1: so you can actually get green bonds. You can quite

570
00:32:41,920 --> 00:32:45,080
Speaker 1: quite intriguing. So so what do you think is going

571
00:32:45,200 --> 00:32:49,000
Speaker 1: to be required for e s G to take off

572
00:32:49,480 --> 00:32:52,920
Speaker 1: or or we contextualizing it's the wrong way and it's

573
00:32:52,960 --> 00:32:56,000
Speaker 1: just going to be something that's implemented into the risk

574
00:32:56,120 --> 00:33:00,200
Speaker 1: screening approach. Yeah, I actually think it's both, So let's

575
00:33:00,240 --> 00:33:03,880
Speaker 1: take the latter first. I believe that the asset management

576
00:33:03,960 --> 00:33:08,560
Speaker 1: industry will just become E s G. Just just integrate it,

577
00:33:08,680 --> 00:33:11,760
Speaker 1: like you're no longer an Internet company everybody uses. Then yes,

578
00:33:11,840 --> 00:33:14,280
Speaker 1: there will. There will no longer be E s G

579
00:33:14,480 --> 00:33:18,280
Speaker 1: or non e s G because millennials and women demographically

580
00:33:18,360 --> 00:33:23,280
Speaker 1: are driving the desire and the requirement to incorporate E

581
00:33:23,440 --> 00:33:26,320
Speaker 1: s G screening within their portfolios is a big, big driver.

582
00:33:26,480 --> 00:33:31,040
Speaker 1: The other is data democratization. Most companies now well there's

583
00:33:31,400 --> 00:33:35,200
Speaker 1: a variety of different data providers that now collect that

584
00:33:35,320 --> 00:33:39,040
Speaker 1: information from companies. So now most of the sp are

585
00:33:39,160 --> 00:33:44,520
Speaker 1: reporting to data providers on those three measures. Their environmental practices,

586
00:33:44,960 --> 00:33:48,360
Speaker 1: there's social practices, and their governance practices. So we now

587
00:33:48,480 --> 00:33:51,360
Speaker 1: have access to all kinds of data to be able

588
00:33:51,400 --> 00:33:53,800
Speaker 1: to screen on those dimensions. Now, don't you run into

589
00:33:53,840 --> 00:33:56,080
Speaker 1: the same sort of issue we get with hedge funds

590
00:33:56,640 --> 00:33:59,719
Speaker 1: reporting performance? Well, if it's good your report and if

591
00:33:59,760 --> 00:34:01,239
Speaker 1: it's not so good, Oh, we're not going to make

592
00:34:01,320 --> 00:34:03,560
Speaker 1: that filing this quae. Well, so here's the issue this

593
00:34:03,720 --> 00:34:05,760
Speaker 1: is this is going to impede the group. So again

594
00:34:05,800 --> 00:34:08,720
Speaker 1: I think to your latter question, we're gonna asset management.

595
00:34:08,760 --> 00:34:10,920
Speaker 1: I can't say exactly when. I think it will be

596
00:34:11,000 --> 00:34:12,759
Speaker 1: somewhere between five to ten years from now. And then

597
00:34:12,760 --> 00:34:14,880
Speaker 1: you think that's a gradual Just one day we'll turn

598
00:34:14,960 --> 00:34:17,040
Speaker 1: around and say, oh we're all s G. Yes, I do,

599
00:34:17,400 --> 00:34:20,080
Speaker 1: I do. And there's a variety of people who agree

600
00:34:20,120 --> 00:34:25,040
Speaker 1: with that premise. The issues today are there's no uniformity, right,

601
00:34:25,120 --> 00:34:27,880
Speaker 1: there's a variety of different approaches. Even the data provider,

602
00:34:27,960 --> 00:34:30,239
Speaker 1: they go at collecting the data and reporting the data

603
00:34:30,280 --> 00:34:33,040
Speaker 1: in a variety of different ways to lack of uniformity

604
00:34:33,080 --> 00:34:36,880
Speaker 1: and data. The second is benchmarking, right, we always want

605
00:34:36,920 --> 00:34:39,040
Speaker 1: to try to especially on the active management side, we

606
00:34:39,080 --> 00:34:42,120
Speaker 1: always want to find a benchmark. So people are struggling

607
00:34:42,160 --> 00:34:46,440
Speaker 1: with how to benchmark E s G strategies and you know, uh,

608
00:34:46,600 --> 00:34:49,759
Speaker 1: consulting organizations like a mercer who does due diligence on

609
00:34:49,840 --> 00:34:53,279
Speaker 1: these strategies, they're they're struggling to answer that question, which

610
00:34:53,320 --> 00:34:56,560
Speaker 1: is sort of a traditional method of you know, rating

611
00:34:56,600 --> 00:34:59,640
Speaker 1: a particular strategy. So I think it's those two things

612
00:34:59,719 --> 00:35:02,640
Speaker 1: that are slowing down the growth. But once we you know,

613
00:35:02,840 --> 00:35:07,080
Speaker 1: come closer to solving those two, I think the growth

614
00:35:07,160 --> 00:35:10,600
Speaker 1: will start to be you know, sort of more profound

615
00:35:10,680 --> 00:35:13,120
Speaker 1: in US retail. So so that's the second part of

616
00:35:13,160 --> 00:35:16,520
Speaker 1: the question, which is will there still be E s

617
00:35:16,600 --> 00:35:19,800
Speaker 1: G focus funds and and who are going to be

618
00:35:19,880 --> 00:35:22,400
Speaker 1: the purchases of these? Yeah, I think there will be. Well.

619
00:35:22,480 --> 00:35:25,960
Speaker 1: First of all, institutions within the US certainly are following

620
00:35:26,239 --> 00:35:29,640
Speaker 1: Europe and so look, I mean I have to say,

621
00:35:29,920 --> 00:35:32,040
Speaker 1: just looking at the last six months to a year,

622
00:35:32,840 --> 00:35:36,320
Speaker 1: most of the r fps we get request for information

623
00:35:36,400 --> 00:35:39,800
Speaker 1: into a new strategy for institutional clients. They all have

624
00:35:39,920 --> 00:35:42,640
Speaker 1: E s G questions in there, and the portfolio management

625
00:35:42,680 --> 00:35:47,440
Speaker 1: has to be able to describe specifically their E s

626
00:35:47,520 --> 00:35:52,040
Speaker 1: G process. And uh so institutions are moving first within

627
00:35:52,160 --> 00:35:55,320
Speaker 1: the the US, and you know retail will follow closer

628
00:35:55,400 --> 00:35:58,120
Speaker 1: behind once we figure out these issues that I talked about,

629
00:35:58,160 --> 00:36:01,800
Speaker 1: which is uniformity and benchmarking. What do you think about

630
00:36:01,880 --> 00:36:04,840
Speaker 1: the dedicated E s G E T F that have

631
00:36:04,960 --> 00:36:09,319
Speaker 1: come out? Paul Jones has one full Just what are

632
00:36:09,360 --> 00:36:11,440
Speaker 1: the ones that you guys so we have s g

633
00:36:11,600 --> 00:36:13,520
Speaker 1: L and s GF and that's where we're taking our

634
00:36:13,560 --> 00:36:16,239
Speaker 1: revenue weated strategy L and F. What's the difference. That's

635
00:36:16,280 --> 00:36:20,600
Speaker 1: some foreign and domestic local local, that's right. I think

636
00:36:20,680 --> 00:36:23,400
Speaker 1: D was taken when we went to look for a ticker.

637
00:36:23,719 --> 00:36:25,560
Speaker 1: So my by the way, my theory is you you

638
00:36:25,680 --> 00:36:29,839
Speaker 1: not only need a good investment idea, but a good

639
00:36:29,920 --> 00:36:33,080
Speaker 1: ticker is just crucial. Absolutely right. It seems like that

640
00:36:33,200 --> 00:36:35,440
Speaker 1: makes a giant difference. It does make a giant difference.

641
00:36:35,480 --> 00:36:37,359
Speaker 1: It cuts through all the clutter. Look and a lot

642
00:36:37,440 --> 00:36:39,200
Speaker 1: of this is coming through the clutter. There's a lot

643
00:36:39,320 --> 00:36:42,960
Speaker 1: of players who have gotten so E s c F

644
00:36:43,200 --> 00:36:46,480
Speaker 1: is foreign s g L and they're they're broad based.

645
00:36:46,560 --> 00:36:48,960
Speaker 1: There's a lot out there that are more narrowly based,

646
00:36:49,000 --> 00:36:52,440
Speaker 1: again specifically as we talked about before, based upon you know,

647
00:36:52,840 --> 00:36:57,160
Speaker 1: climate change, um, climate risk, carbon emissions, things of that nature.

648
00:36:57,200 --> 00:36:58,520
Speaker 1: We want to be more broad based. So this is

649
00:36:58,600 --> 00:37:02,120
Speaker 1: revenue weighted s G strategies. But there are many and

650
00:37:02,200 --> 00:37:04,359
Speaker 1: there are many mutual funds. We have a mutual fund

651
00:37:04,400 --> 00:37:06,440
Speaker 1: where we partner with pick t A and it's a

652
00:37:06,520 --> 00:37:10,600
Speaker 1: Geo environmental h an E s G shop in Europe.

653
00:37:11,040 --> 00:37:13,920
Speaker 1: Is very their subadvisor to us and we like them

654
00:37:13,960 --> 00:37:17,440
Speaker 1: a lot actually. Um. And so there are strategies that

655
00:37:17,480 --> 00:37:20,520
Speaker 1: are coming out in separate account, mutual fund any TF

656
00:37:20,640 --> 00:37:25,440
Speaker 1: fashion that I think are a good start. Um. You know. Again,

657
00:37:25,600 --> 00:37:28,800
Speaker 1: the institutional clients are looking for more of the separate account,

658
00:37:28,800 --> 00:37:31,400
Speaker 1: in some cases mutual funds. M. They're not buying the

659
00:37:31,440 --> 00:37:33,719
Speaker 1: E s G E T f s quite yet. There

660
00:37:33,760 --> 00:37:36,719
Speaker 1: are people like the UN partnering with firms and developing

661
00:37:36,800 --> 00:37:39,359
Speaker 1: some of their E s G strategies. And there's big

662
00:37:39,440 --> 00:37:41,880
Speaker 1: pensions like CalPERS who partnered with State Street on she

663
00:37:42,640 --> 00:37:46,040
Speaker 1: they seated she to the tune of Calipers or Calisters

664
00:37:46,200 --> 00:37:52,000
Speaker 1: it was Kelpers. So who did Calists? M sure I

665
00:37:52,120 --> 00:37:54,520
Speaker 1: kind of remember them being involved our counts now I

666
00:37:54,600 --> 00:37:57,880
Speaker 1: know Calipers seated two d and fifty billion. Yeah, it was.

667
00:37:58,120 --> 00:37:59,840
Speaker 1: It was a big chunk of whatever it was. It

668
00:38:00,040 --> 00:38:06,640
Speaker 1: is a big jump of change um or million, excuse me,

669
00:38:06,760 --> 00:38:10,279
Speaker 1: it was. It was definitely a which is still not

670
00:38:10,440 --> 00:38:14,960
Speaker 1: ann So so our mutual friend Dave Nodding is a

671
00:38:15,080 --> 00:38:19,800
Speaker 1: huge fan of direct index. I'm slowly warming up to

672
00:38:19,880 --> 00:38:23,480
Speaker 1: the concept and where I see it having so much

673
00:38:23,520 --> 00:38:27,120
Speaker 1: potential is exactly what you just described the s M

674
00:38:27,160 --> 00:38:30,440
Speaker 1: as for individuals that want to have an overlay of this.

675
00:38:31,000 --> 00:38:34,400
Speaker 1: How do you see that space development? Yeah? Yeah, so

676
00:38:34,760 --> 00:38:38,080
Speaker 1: I I actually agree with Dave. Um, you know, getting

677
00:38:38,480 --> 00:38:41,680
Speaker 1: instead of buying the index, sort of buying the the

678
00:38:42,160 --> 00:38:45,120
Speaker 1: you know, underlying holdings of the index. That creates a

679
00:38:45,200 --> 00:38:52,080
Speaker 1: great opportunity for tax efficiency, tax harvesting, customization. Uh. There

680
00:38:52,160 --> 00:38:54,080
Speaker 1: are some firms out there, they are very good at it.

681
00:38:54,440 --> 00:38:57,400
Speaker 1: Parametric has been around for a while, Imperio, Uh, there

682
00:38:57,440 --> 00:39:01,399
Speaker 1: are others um and so you know, look, people are

683
00:39:01,480 --> 00:39:06,320
Speaker 1: looking for more of those things UM, and you have

684
00:39:06,719 --> 00:39:10,839
Speaker 1: more flexibility in getting access to that through direct indexation.

685
00:39:11,320 --> 00:39:14,279
Speaker 1: It is a little bit more uh efficient from a

686
00:39:14,400 --> 00:39:17,280
Speaker 1: cost perspective, You're not because you're not paying an index

687
00:39:17,320 --> 00:39:20,600
Speaker 1: provider three to five basis points. So the the index

688
00:39:21,080 --> 00:39:25,520
Speaker 1: landscape is changing as well as fees are getting driven

689
00:39:25,600 --> 00:39:28,120
Speaker 1: down there as well, people are doing self indexing, their

690
00:39:28,120 --> 00:39:31,360
Speaker 1: self indexing providers out there who are calculation agents, and

691
00:39:31,520 --> 00:39:34,239
Speaker 1: so the world of indexation as it existed ten years

692
00:39:34,239 --> 00:39:38,120
Speaker 1: ago is also changing because of self indexing and direct indexation.

693
00:39:38,560 --> 00:39:40,120
Speaker 1: I agree with Dave. I think it's going to grow

694
00:39:40,360 --> 00:39:44,560
Speaker 1: quite quite fascinating. So before we began we were talking

695
00:39:44,600 --> 00:39:49,680
Speaker 1: about music because you happen to see my picture, tweeted

696
00:39:49,760 --> 00:39:53,680
Speaker 1: of Eagles guitarist Don Felder. I have to tell you

697
00:39:53,880 --> 00:39:57,040
Speaker 1: that was a ridiculous amount of fun. I'm sure it was.

698
00:39:57,200 --> 00:40:00,719
Speaker 1: I'm jealous is my thing. Everyone who knows me knows

699
00:40:00,800 --> 00:40:03,160
Speaker 1: that music is my thing. Me too. I don't know

700
00:40:03,320 --> 00:40:06,399
Speaker 1: how far apart in age we are. We'll talk about

701
00:40:06,440 --> 00:40:11,880
Speaker 1: that later. You're deceptively um, You're like, you're hard to

702
00:40:12,080 --> 00:40:16,000
Speaker 1: pin an age on. Okay, like thirty nine is safe.

703
00:40:16,320 --> 00:40:18,960
Speaker 1: I'll take it. Um, I said you start, well that

704
00:40:19,000 --> 00:40:21,120
Speaker 1: would You said you've been in the business thirty years,

705
00:40:21,160 --> 00:40:23,080
Speaker 1: and I said you started it at age nine. So

706
00:40:23,920 --> 00:40:26,160
Speaker 1: that's how I came to that. Um. But I'm a

707
00:40:26,239 --> 00:40:28,920
Speaker 1: class I listened to a lot of stuff from jazz

708
00:40:29,000 --> 00:40:32,120
Speaker 1: to classical but really uh and a lot of punk

709
00:40:32,200 --> 00:40:35,200
Speaker 1: and reggae. But I'm really a classic rock guy. What

710
00:40:35,440 --> 00:40:40,040
Speaker 1: what's your musical over classic rock? Okay, you know classic

711
00:40:40,120 --> 00:40:45,759
Speaker 1: rewind or classic tracks on? On? Yeah, exactly. So you're

712
00:40:45,760 --> 00:40:48,520
Speaker 1: not a coffeehouse sort of No, Actually, it depends on

713
00:40:48,600 --> 00:40:50,320
Speaker 1: the mood. I like coffee house as well. Thank you

714
00:40:50,400 --> 00:40:53,200
Speaker 1: for bringing that up. Well, if you're a jack Johnson fan.

715
00:40:53,360 --> 00:40:56,960
Speaker 1: That's a great sort of a great sort of channel. Um,

716
00:40:57,320 --> 00:40:59,920
Speaker 1: so I've had I don't know how this has worked out.

717
00:41:00,000 --> 00:41:03,320
Speaker 1: It's been a dumb accident. But I've had a series

718
00:41:03,400 --> 00:41:07,440
Speaker 1: of guitarists. So it's been Don Felder and Steve Miller.

719
00:41:08,560 --> 00:41:13,279
Speaker 1: Steve Miller is, Lawrence Juber and John Pizzarelli. So those

720
00:41:13,320 --> 00:41:16,759
Speaker 1: are the four guitarists I've had. And I should reach

721
00:41:16,800 --> 00:41:19,600
Speaker 1: out to Jack Johnson because I love his ry. He's

722
00:41:19,640 --> 00:41:23,520
Speaker 1: a great Uh, so these things come up. Trucks, can

723
00:41:23,560 --> 00:41:27,120
Speaker 1: we talk about derren so your southern sort of roots?

724
00:41:27,480 --> 00:41:29,520
Speaker 1: So look, I mean I also love southern rock. But

725
00:41:29,640 --> 00:41:31,279
Speaker 1: my two so, I think Derek Trucks is one of

726
00:41:31,360 --> 00:41:34,439
Speaker 1: the most gifted guitarist and you know he's so that's

727
00:41:34,480 --> 00:41:37,040
Speaker 1: your pick for greatest guitarists? No, he actually he's not.

728
00:41:37,200 --> 00:41:39,600
Speaker 1: He's he's sort of next generation. My pick, but my

729
00:41:39,920 --> 00:41:44,360
Speaker 1: two picks, which I can't decide on, is uh, Carlos Santana.

730
00:41:44,719 --> 00:41:48,520
Speaker 1: I love Santana. He's technically a brilliant guitarist and a

731
00:41:48,680 --> 00:41:51,919
Speaker 1: very good songwriter. I don't know if many people would

732
00:41:51,960 --> 00:41:55,440
Speaker 1: put him up as in the top five because it's

733
00:41:55,520 --> 00:42:00,719
Speaker 1: usually the hyper technical guys like Joe Satriani or go

734
00:42:00,880 --> 00:42:03,640
Speaker 1: down to Montrose or and of course you know we

735
00:42:03,680 --> 00:42:06,160
Speaker 1: could talk about Clapton or June. Well, so that's my second.

736
00:42:06,640 --> 00:42:09,719
Speaker 1: So my second is Clapton. I would probably to your point,

737
00:42:09,719 --> 00:42:12,040
Speaker 1: I'd probably edge Clapton over cent Town a little bit.

738
00:42:12,560 --> 00:42:16,000
Speaker 1: But I gotta tell you, Derek Trucks is you know,

739
00:42:16,640 --> 00:42:18,880
Speaker 1: he's he's gonna think gonna arrival everybody. He's just a

740
00:42:18,960 --> 00:42:21,600
Speaker 1: little bit younger. I asked, Um, By the way, if

741
00:42:21,640 --> 00:42:25,520
Speaker 1: you like that sort of swampy southern are you familiar

742
00:42:25,600 --> 00:42:29,560
Speaker 1: with UM? J. J. Gray and the Mofro No? Oh,

743
00:42:29,880 --> 00:42:33,799
Speaker 1: so that's it. Then you have to check out. It's swampy,

744
00:42:34,239 --> 00:42:37,760
Speaker 1: bluesy southern roots rocking. They have a number of great albums,

745
00:42:37,920 --> 00:42:39,920
Speaker 1: but you can never go wrong with that first album

746
00:42:40,040 --> 00:42:43,680
Speaker 1: is J. J. Gray in the mo They're just um

747
00:42:44,840 --> 00:42:47,480
Speaker 1: sort of like a Southern version of Remember the album

748
00:42:48,040 --> 00:42:50,960
Speaker 1: Thick Freakness by Um. I'm ding a blank on the

749
00:42:51,000 --> 00:42:55,120
Speaker 1: band's name, but that Um Black Keys guy, that's the

750
00:42:55,200 --> 00:42:59,560
Speaker 1: first album. And I and I so, I asked Henley,

751
00:43:00,120 --> 00:43:02,120
Speaker 1: let me we can talk about music for hours, but

752
00:43:02,600 --> 00:43:05,040
Speaker 1: let me wrap this up. I asked Henley, who do

753
00:43:05,160 --> 00:43:09,960
Speaker 1: you think, um, what sort of guitarists do you like?

754
00:43:10,120 --> 00:43:13,399
Speaker 1: Who do you really appreciate? And he said, I love

755
00:43:13,560 --> 00:43:17,840
Speaker 1: the Triple Threats. I love people who are great songwriters,

756
00:43:18,520 --> 00:43:21,600
Speaker 1: ken sing and a really good performers. And I knew

757
00:43:21,640 --> 00:43:24,120
Speaker 1: exactly where he was going to go with that. I

758
00:43:24,320 --> 00:43:27,239
Speaker 1: thought he was going to say clapped in, but um,

759
00:43:28,400 --> 00:43:31,440
Speaker 1: he kind of surprised me and said, well, this generation,

760
00:43:31,520 --> 00:43:34,439
Speaker 1: it's John Mayer is that Triple Threat? And I said

761
00:43:34,560 --> 00:43:38,480
Speaker 1: that's because that's he's this generation the class. So who

762
00:43:38,520 --> 00:43:41,080
Speaker 1: else do you again? So I don't forget I put

763
00:43:41,160 --> 00:43:44,719
Speaker 1: Derek right up there. Yeah, but you know, and again

764
00:43:44,760 --> 00:43:47,080
Speaker 1: I'm a big Alllin Brothers fan, you know, I mean

765
00:43:47,160 --> 00:43:49,719
Speaker 1: that story, you know, has been a bit of a

766
00:43:49,800 --> 00:43:53,240
Speaker 1: sad story. But of course Dwayne Allman taught Don Felder

767
00:43:53,280 --> 00:43:56,279
Speaker 1: to play slide guitar house and they're all from the

768
00:43:56,440 --> 00:44:00,880
Speaker 1: music scene from Gainesville. Was crazy, was him, and I

769
00:44:00,960 --> 00:44:03,800
Speaker 1: think it was Stephen Stills and Tom Petty and it

770
00:44:03,960 --> 00:44:06,200
Speaker 1: was just like a like, wait, why are all those

771
00:44:06,400 --> 00:44:09,800
Speaker 1: people coming from Gainesville, Florida? And then Dwayne Alman on

772
00:44:09,920 --> 00:44:12,279
Speaker 1: top of that. So then of course, you know, Greg

773
00:44:12,480 --> 00:44:14,320
Speaker 1: just died, which was a very sad day for me.

774
00:44:14,480 --> 00:44:17,960
Speaker 1: But so you know, Ada Peach was my favorite Almon

775
00:44:18,040 --> 00:44:20,480
Speaker 1: Brothers album. I remember that was giant when I was

776
00:44:20,520 --> 00:44:24,040
Speaker 1: in high school. Giant. That was who else you listen

777
00:44:24,120 --> 00:44:27,279
Speaker 1: to today? Give me a newer you know today? I

778
00:44:27,360 --> 00:44:29,080
Speaker 1: have to tell you I'm sort of evolving a little

779
00:44:29,080 --> 00:44:32,359
Speaker 1: bit too, you know, sort of this newer country such

780
00:44:32,440 --> 00:44:38,160
Speaker 1: as so you know Dirk Spentley, Um, Zack Brown, Zack Brown.

781
00:44:38,239 --> 00:44:40,439
Speaker 1: I know Dirk Spentley. I don't know that. Yeah, yeah,

782
00:44:41,680 --> 00:44:43,440
Speaker 1: a lot of those guys got a little more of

783
00:44:43,480 --> 00:44:46,840
Speaker 1: an edge than tradition shoes radio. I mean, Kenny Chesney

784
00:44:46,960 --> 00:44:50,600
Speaker 1: obviously is terrific. Um, so you know. I so I'm

785
00:44:50,640 --> 00:44:55,160
Speaker 1: really pushing myself to appreciate other genres. And I didn't

786
00:44:55,200 --> 00:44:58,920
Speaker 1: like the old twangy country Chad Atkins sort of well

787
00:44:59,000 --> 00:45:01,760
Speaker 1: he was a brilliant guitarist. But the I know exactly,

788
00:45:01,800 --> 00:45:05,320
Speaker 1: I love My dog died, my my wife left me

789
00:45:06,080 --> 00:45:09,080
Speaker 1: that so there's a really do you ever we were

790
00:45:09,080 --> 00:45:10,840
Speaker 1: talking about X some satellite before. Do you have a

791
00:45:10,880 --> 00:45:14,600
Speaker 1: play with Pandora? Pandora that's my actually music of choice.

792
00:45:14,640 --> 00:45:16,360
Speaker 1: I have so knows in my home, so do I

793
00:45:16,880 --> 00:45:19,000
Speaker 1: and I go to Pandora. So what I love about

794
00:45:19,040 --> 00:45:23,359
Speaker 1: Pandora is if you want to discover something new, Yeah,

795
00:45:23,840 --> 00:45:27,640
Speaker 1: like you take those three newer country, create a channel,

796
00:45:27,920 --> 00:45:29,880
Speaker 1: call it whatever you want new country, and seed it

797
00:45:29,960 --> 00:45:33,399
Speaker 1: with five songs that you like. And it's really great

798
00:45:33,440 --> 00:45:36,320
Speaker 1: for music discovery. I'm always hearing things. Wow, what's that?

799
00:45:36,440 --> 00:45:38,200
Speaker 1: I haven't heard that? So it's a fun thing to

800
00:45:38,280 --> 00:45:42,359
Speaker 1: play with. Yeah, all right, back to back to ets. Sorry,

801
00:45:42,480 --> 00:45:44,359
Speaker 1: sorry to drag you back to you said I could

802
00:45:44,360 --> 00:45:48,520
Speaker 1: talk music all day long. Same here. It's it's just fascinating.

803
00:45:49,000 --> 00:45:52,560
Speaker 1: I um anything aside from country rock and classic rock.

804
00:45:52,640 --> 00:45:55,279
Speaker 1: You listen to jazz, you listen to reggae. I do.

805
00:45:55,480 --> 00:45:57,080
Speaker 1: I listened to both, but I have to say my

806
00:45:57,320 --> 00:46:02,160
Speaker 1: my world is really dominated by the too today. Um.

807
00:46:02,360 --> 00:46:04,120
Speaker 1: But I I used to listen to a lot more

808
00:46:04,160 --> 00:46:07,640
Speaker 1: classical um than I do today. I've always listened to jazz.

809
00:46:07,719 --> 00:46:10,759
Speaker 1: Miles Davis is my hero. Really, Miles Davis is my hero,

810
00:46:11,000 --> 00:46:13,440
Speaker 1: for he's not. I always warn people who are like

811
00:46:13,560 --> 00:46:15,640
Speaker 1: your your jazz head, what what should I listen to?

812
00:46:15,960 --> 00:46:19,080
Speaker 1: Should I listen to? Miles Davis? Not the most accessible?

813
00:46:19,520 --> 00:46:22,440
Speaker 1: Like I always say, start, start, slow, walk before you run,

814
00:46:22,760 --> 00:46:26,680
Speaker 1: because who is your walk slow person. Jerry Mulligan. Um,

815
00:46:27,160 --> 00:46:30,520
Speaker 1: like Coltrane, I I build a little further out halfway

816
00:46:30,560 --> 00:46:38,000
Speaker 1: between even thelonious monk um Um Paul Desmonds. Uh, you can't.

817
00:46:38,280 --> 00:46:41,480
Speaker 1: That's really totally accessible, very easy for most people. If

818
00:46:41,520 --> 00:46:45,200
Speaker 1: you if you listen to like Time Out or so there,

819
00:46:45,360 --> 00:46:48,120
Speaker 1: there's a way to to ease into jazz. But if

820
00:46:48,120 --> 00:46:51,279
Speaker 1: you start with bitches Brew or you know, that's a

821
00:46:51,480 --> 00:46:55,200
Speaker 1: tough It's like it's the equivalent of starting out in

822
00:46:55,320 --> 00:46:59,440
Speaker 1: rock music by listening to Frank's Appa. It's like Jethro Tull. Yeah,

823
00:46:59,800 --> 00:47:03,160
Speaker 1: that's call is. You know, you could listen you know,

824
00:47:03,320 --> 00:47:07,520
Speaker 1: aqualong or locomotive breath. Yeah, that's straightforward rock and roll.

825
00:47:08,040 --> 00:47:10,839
Speaker 1: But it's hard to find outside of Joe's garage. It's

826
00:47:10,840 --> 00:47:13,320
Speaker 1: hard to find a Zappa song that you could just

827
00:47:13,440 --> 00:47:15,680
Speaker 1: slide right into and say, I'm interested in rock music.

828
00:47:15,760 --> 00:47:20,640
Speaker 1: Play something for me because um, although since you mentioned

829
00:47:20,760 --> 00:47:26,280
Speaker 1: some of your favorite guitarists, if you ever have a chance,

830
00:47:26,719 --> 00:47:29,880
Speaker 1: get the Zappa album, shut up and play your guitar.

831
00:47:30,719 --> 00:47:33,920
Speaker 1: Y e er guitar. It's just three discs of him

832
00:47:34,080 --> 00:47:38,200
Speaker 1: doing leads and he's amazing. People don't realize what a

833
00:47:38,239 --> 00:47:41,600
Speaker 1: spectacular technical musician. You know, I didn't. And if I

834
00:47:41,640 --> 00:47:44,239
Speaker 1: could just make one plug for for a female the

835
00:47:44,320 --> 00:47:49,200
Speaker 1: modern day Bonnie Rate is Derek Truck's wife, Susan Twadski

836
00:47:51,760 --> 00:47:55,680
Speaker 1: a band two Trucks, you would not know the difference.

837
00:47:56,120 --> 00:47:58,320
Speaker 1: I think she's got more soul. Bonni Rate is a

838
00:47:58,360 --> 00:48:00,320
Speaker 1: ton of soul. But if if you can believe Susan

839
00:48:00,320 --> 00:48:02,960
Speaker 1: Tudeski even has more soul than body, right, so I

840
00:48:03,040 --> 00:48:05,840
Speaker 1: would I need to make my female plug before we

841
00:48:05,920 --> 00:48:11,680
Speaker 1: move on? All right? Last female guitarist um reference, Go

842
00:48:11,840 --> 00:48:14,200
Speaker 1: to YouTube. I can't remember the girl's name, and I

843
00:48:14,320 --> 00:48:17,600
Speaker 1: say girl because she's like eleven. There is this girl

844
00:48:17,920 --> 00:48:23,440
Speaker 1: on YouTube who just shreds. It's unbelievable. There's probably multiple

845
00:48:23,560 --> 00:48:27,360
Speaker 1: people in that age group who are just spectacular guitarists

846
00:48:28,160 --> 00:48:32,400
Speaker 1: and it's mind blowing you. Just I'll send you some links.

847
00:48:32,840 --> 00:48:36,000
Speaker 1: Some of them are just like what. Alright? So so

848
00:48:36,160 --> 00:48:40,359
Speaker 1: now now back to eat got drag herself away from music? Well,

849
00:48:40,400 --> 00:48:44,279
Speaker 1: because you know this is a conversation over a beer. Um.

850
00:48:44,560 --> 00:48:46,680
Speaker 1: The one question I forgot to ask you during the

851
00:48:46,719 --> 00:48:50,640
Speaker 1: broadcast portion that I meant to ask is you began

852
00:48:50,760 --> 00:48:57,040
Speaker 1: your career in nine seven, Right, what was stock market crash? Yeah?

853
00:48:57,239 --> 00:48:59,799
Speaker 1: What was that like? And by the way, there are

854
00:48:59,880 --> 00:49:03,759
Speaker 1: a few people who I know of David Rosenberg is one,

855
00:49:03,800 --> 00:49:05,520
Speaker 1: and I'm trying to remember who the other person was

856
00:49:06,000 --> 00:49:10,440
Speaker 1: who literally begin their career that fall and bang right

857
00:49:10,480 --> 00:49:12,600
Speaker 1: into I started and I think at the end of

858
00:49:12,680 --> 00:49:15,480
Speaker 1: May or June. But it was that fall. Um, you

859
00:49:15,600 --> 00:49:17,919
Speaker 1: certainly look, I mean it was. It was a great

860
00:49:18,000 --> 00:49:20,839
Speaker 1: learning experience for me, right, I mean, I am I right.

861
00:49:20,960 --> 00:49:23,359
Speaker 1: It was a five points, it was you know, percentage wise,

862
00:49:23,400 --> 00:49:29,000
Speaker 1: it was big and something like that. I think it

863
00:49:29,040 --> 00:49:31,239
Speaker 1: was six hundred and something points. It's easy enough. I

864
00:49:31,280 --> 00:49:33,759
Speaker 1: don't know why five hundred six in my mind, but um,

865
00:49:33,960 --> 00:49:37,640
Speaker 1: which we call today a Tuesday, Yeah, right, exactly exactly.

866
00:49:37,719 --> 00:49:39,440
Speaker 1: That's why that's why I brought it up. It's it's

867
00:49:39,520 --> 00:49:42,000
Speaker 1: sort of interesting to look back, and you know, it's

868
00:49:42,000 --> 00:49:45,120
Speaker 1: a blip in today's world. But but look, so I

869
00:49:45,320 --> 00:49:47,960
Speaker 1: wasn't really tied to the market at that time. Remember

870
00:49:48,000 --> 00:49:49,680
Speaker 1: as a Chase Manhattan Bank, and I was doing all

871
00:49:49,719 --> 00:49:52,319
Speaker 1: these cost studies. I still was domestic at this time.

872
00:49:52,360 --> 00:49:54,920
Speaker 1: I wasn't yet in Europe. By the way, you have

873
00:49:55,000 --> 00:49:57,840
Speaker 1: correct five eight points, Thank you. I I don't know

874
00:49:57,880 --> 00:49:59,239
Speaker 1: why that's stuck in my head, but you know I

875
00:49:59,360 --> 00:50:02,160
Speaker 1: was there, so you know these things are important. Um.

876
00:50:02,719 --> 00:50:04,800
Speaker 1: And so it was a great learning experience for me.

877
00:50:04,840 --> 00:50:07,239
Speaker 1: I was still learning about the market, right and so

878
00:50:07,920 --> 00:50:10,239
Speaker 1: uh me and Chase Manhattan Bank, you know too, I

879
00:50:10,320 --> 00:50:13,120
Speaker 1: had some exposures. So they obviously took a hit but recovered.

880
00:50:13,120 --> 00:50:16,120
Speaker 1: I think Don Boudreau was the the CEO or president

881
00:50:16,160 --> 00:50:19,160
Speaker 1: at the time. Um. But so you know, there was

882
00:50:19,200 --> 00:50:21,880
Speaker 1: a lot to learn in terms of the you know,

883
00:50:22,080 --> 00:50:26,279
Speaker 1: how the market factors into sort of the you know,

884
00:50:26,360 --> 00:50:29,120
Speaker 1: the capital markets and what a driver they are and

885
00:50:29,320 --> 00:50:31,640
Speaker 1: why that happened and how to avoid it and how

886
00:50:31,719 --> 00:50:34,160
Speaker 1: to put you know, stops in place by the New

887
00:50:34,239 --> 00:50:38,200
Speaker 1: York Stock Exchange. And so I was young and you

888
00:50:38,280 --> 00:50:40,440
Speaker 1: know what behind the ears as they say, And so

889
00:50:40,760 --> 00:50:43,520
Speaker 1: I was just a great learning experience for me. Don Boudreau,

890
00:50:43,600 --> 00:50:47,600
Speaker 1: why is that name familiar? Is he still around and published?

891
00:50:47,800 --> 00:50:52,680
Speaker 1: He's been retired, So you you looked at it as

892
00:50:52,760 --> 00:50:55,960
Speaker 1: a learning experience I did. I didn't have any personal exposure.

893
00:50:55,960 --> 00:50:58,040
Speaker 1: I had no money, so you know it didn't affect me.

894
00:50:58,360 --> 00:51:01,279
Speaker 1: Are the best crash exactly? Now? The next one I was,

895
00:51:01,440 --> 00:51:02,880
Speaker 1: by the way, I was in grad school and I

896
00:51:03,000 --> 00:51:07,239
Speaker 1: watched it with such clinical, detached detachment. It was like, oh,

897
00:51:07,360 --> 00:51:09,560
Speaker 1: that seems to be kind of interesting. Now. I was fascinated,

898
00:51:10,040 --> 00:51:11,600
Speaker 1: you know, I thankfully was at a place where I

899
00:51:11,600 --> 00:51:13,360
Speaker 1: could learn more about it. And that was really my

900
00:51:13,480 --> 00:51:16,880
Speaker 1: first like ouch when you when you when you um accidentally,

901
00:51:17,000 --> 00:51:18,920
Speaker 1: you know, touch a burner on this story, it was

902
00:51:18,960 --> 00:51:21,520
Speaker 1: sort of like a you know, learning about the capital

903
00:51:21,600 --> 00:51:23,680
Speaker 1: markets by being stung by it. But thankfully it didn't

904
00:51:23,680 --> 00:51:29,840
Speaker 1: affect yes, and so did two thousand. Obviously two thousand

905
00:51:29,920 --> 00:51:31,640
Speaker 1: it was the worst, but that was the best one

906
00:51:31,680 --> 00:51:34,840
Speaker 1: of all two left of market. Yeah, so two thousand

907
00:51:34,840 --> 00:51:38,560
Speaker 1: and eight was fabulous learning experience. Can we describe it

908
00:51:38,600 --> 00:51:42,799
Speaker 1: as that because it was we'll take that off, Mike.

909
00:51:42,840 --> 00:51:45,719
Speaker 1: I found that to be of all the market crashes

910
00:51:46,239 --> 00:51:49,880
Speaker 1: I lived through, the one that was most fascinating. Yeah, No,

911
00:51:50,040 --> 00:51:52,520
Speaker 1: it certainly was. There's millions of stories that have come

912
00:51:52,520 --> 00:51:55,279
Speaker 1: out of that. When it's really shaped, it's shaped, you know,

913
00:51:55,320 --> 00:51:58,920
Speaker 1: the whole generation. Absolutely. You alluded to this earlier. Let

914
00:51:58,960 --> 00:52:03,200
Speaker 1: me circle back to that. My pet theory is all

915
00:52:03,320 --> 00:52:07,120
Speaker 1: of the scandals, the animal scandal, the IP, all those

916
00:52:07,239 --> 00:52:11,400
Speaker 1: things kind of led mom and pop to say, you know,

917
00:52:11,760 --> 00:52:14,560
Speaker 1: this Wall Street thing is, you know, I'm just gonna

918
00:52:14,760 --> 00:52:18,560
Speaker 1: give the money to Vanguard and be done. I kind

919
00:52:18,600 --> 00:52:21,560
Speaker 1: of felt like the cherry on that cake was the

920
00:52:21,640 --> 00:52:24,560
Speaker 1: O eight oh nine crash. But you even took it further.

921
00:52:24,680 --> 00:52:30,200
Speaker 1: You said, this really drove people into passive explain absolutely absolutely, Um,

922
00:52:30,680 --> 00:52:33,479
Speaker 1: you know, part of it is they sort of didn't

923
00:52:33,480 --> 00:52:35,279
Speaker 1: want to deal with it anymore. Just let me, let

924
00:52:35,360 --> 00:52:37,080
Speaker 1: me just give it to an index. Let me give

925
00:52:37,160 --> 00:52:39,560
Speaker 1: my money to an index. They didn't trust the institutions

926
00:52:39,600 --> 00:52:41,520
Speaker 1: that were running their money in a lot of cases,

927
00:52:41,640 --> 00:52:44,040
Speaker 1: especially the ones that got bailed out, that had to

928
00:52:44,320 --> 00:52:48,080
Speaker 1: imbat the thought process right exactly right, And so I

929
00:52:48,200 --> 00:52:51,680
Speaker 1: think it just shocked people. People woke up. I think

930
00:52:51,840 --> 00:52:55,320
Speaker 1: previous that they dabbled in et f s a post

931
00:52:55,480 --> 00:52:57,600
Speaker 1: two thousand and eight, two thou nine, when when we

932
00:52:57,680 --> 00:53:01,200
Speaker 1: finally recovered, I think they made it a prominent part

933
00:53:01,280 --> 00:53:03,560
Speaker 1: of their portfolio construction, and part of it I think

934
00:53:03,640 --> 00:53:06,200
Speaker 1: was a risk mitigation, at least from what they understood

935
00:53:06,239 --> 00:53:09,160
Speaker 1: to be more of a risk mitigation because of you know,

936
00:53:09,320 --> 00:53:10,960
Speaker 1: let me look, at the time, I was at a

937
00:53:11,040 --> 00:53:14,520
Speaker 1: lines Bernstein uh Bernstein that part of a line Spernstein's

938
00:53:14,560 --> 00:53:19,040
Speaker 1: deep value and um, you know the Bernstein managers specifically

939
00:53:19,080 --> 00:53:21,319
Speaker 1: and Loose Sanders as an investor himself, the CEO at

940
00:53:21,360 --> 00:53:24,120
Speaker 1: the time, they rode financial services down all the way

941
00:53:24,200 --> 00:53:27,520
Speaker 1: to the bottom because they were looking for that. You

942
00:53:27,560 --> 00:53:29,920
Speaker 1: know what they talk about the sustainability of earnings with

943
00:53:30,000 --> 00:53:32,960
Speaker 1: growth companies, and they talk about the recoverability of earnings

944
00:53:33,520 --> 00:53:38,520
Speaker 1: with with value companies, and so you know, fundamental active managers.

945
00:53:38,600 --> 00:53:40,600
Speaker 1: I think at the time, we're just riding the wave

946
00:53:40,680 --> 00:53:42,319
Speaker 1: to see if they can pick up some assets at

947
00:53:42,360 --> 00:53:45,000
Speaker 1: the cheap. And that was a very, very tough ride

948
00:53:45,160 --> 00:53:46,920
Speaker 1: for a lot of investors. So I think part of

949
00:53:46,960 --> 00:53:49,320
Speaker 1: it was trust. I think a lot of it was

950
00:53:49,760 --> 00:53:55,680
Speaker 1: risk mitigation. Quite quite interesting. So again looking at the

951
00:53:55,880 --> 00:53:59,080
Speaker 1: lack of faith in the institutions, is that something that

952
00:53:59,239 --> 00:54:03,080
Speaker 1: eventually comes back or is that a permanent scar and

953
00:54:03,320 --> 00:54:06,759
Speaker 1: people change their behavior for a generation. Yeah, yeah, No,

954
00:54:06,880 --> 00:54:09,120
Speaker 1: I think ten years later, I think it is bouncing back.

955
00:54:09,200 --> 00:54:10,880
Speaker 1: And I think part of it is, you know, government

956
00:54:11,000 --> 00:54:13,040
Speaker 1: lead because of everything they've put in place in terms

957
00:54:13,080 --> 00:54:17,600
Speaker 1: of safeguards, meaning the regulatory environment or the federal reserve environment.

958
00:54:18,239 --> 00:54:21,160
Speaker 1: I think the regulatory environment in terms of the requirements

959
00:54:21,239 --> 00:54:24,000
Speaker 1: that they have. So they forced some of it. And

960
00:54:24,120 --> 00:54:27,000
Speaker 1: I think CEO s I mean, now, on the executive

961
00:54:27,000 --> 00:54:29,800
Speaker 1: committees of organizations, whether it's a bank or asset managers,

962
00:54:30,160 --> 00:54:32,840
Speaker 1: the chief risk officer reports to the CEO. And that

963
00:54:33,000 --> 00:54:36,400
Speaker 1: wasn't a position that necessarily exists. It didn't didn't it

964
00:54:36,520 --> 00:54:39,839
Speaker 1: didn't so and I agree with that, right, I mean,

965
00:54:39,880 --> 00:54:42,359
Speaker 1: the general council reports the CEO. Why shouldn't the chief

966
00:54:42,440 --> 00:54:45,480
Speaker 1: risk officers. It's we are stewards of our clients capitals,

967
00:54:45,520 --> 00:54:50,719
Speaker 1: we are fiduciaries. We need to take that particular function seriously.

968
00:54:51,320 --> 00:54:53,800
Speaker 1: And so you know, whether it's it did the different

969
00:54:53,880 --> 00:54:57,680
Speaker 1: government structures for running an etf business or fundamental active business.

970
00:54:57,719 --> 00:55:02,399
Speaker 1: I think whether it was regulatory pushed or forced upon,

971
00:55:02,760 --> 00:55:06,000
Speaker 1: or firms just taking this more seriously and it becoming

972
00:55:06,040 --> 00:55:10,719
Speaker 1: a key role of the CEO. I think that certainly, Uh,

973
00:55:11,000 --> 00:55:14,080
Speaker 1: those institutions are starting to earn back trust ten years later.

974
00:55:14,200 --> 00:55:17,000
Speaker 1: Do we do we run the risk when we elevate

975
00:55:17,160 --> 00:55:21,680
Speaker 1: the chief risk officer to that c suite with the

976
00:55:22,080 --> 00:55:26,600
Speaker 1: CEO's ear of stifling innovation or making companies risk averse?

977
00:55:26,680 --> 00:55:28,360
Speaker 1: Sure no, And I think that's a great question, and

978
00:55:28,440 --> 00:55:30,239
Speaker 1: I think it has to and we and we talk

979
00:55:30,280 --> 00:55:32,319
Speaker 1: about this a lot at Oppenheimer Funds, and I think

980
00:55:32,520 --> 00:55:35,640
Speaker 1: thankfully we've struck the balance because the portfolio management teams

981
00:55:36,280 --> 00:55:39,319
Speaker 1: UM on the fundamental active side are you know, there's

982
00:55:39,320 --> 00:55:41,120
Speaker 1: a little bit of a push pole there, right. So

983
00:55:41,960 --> 00:55:45,400
Speaker 1: our chief investment Officer, Christian MoManI Um, you know, he

984
00:55:46,040 --> 00:55:48,480
Speaker 1: works very very closely with our chief risk officer on

985
00:55:48,640 --> 00:55:51,480
Speaker 1: behalf of making sure that we don't do just that,

986
00:55:52,080 --> 00:55:55,200
Speaker 1: that we give the prudent degree of freedom. Now, how

987
00:55:55,239 --> 00:55:58,239
Speaker 1: do you define prudent degree of freedom? No leverage? That's

988
00:55:58,280 --> 00:56:02,000
Speaker 1: how I define it, Um, And you know, I mean, really,

989
00:56:02,040 --> 00:56:04,320
Speaker 1: it's so much easier to get into trouble when you're running,

990
00:56:04,360 --> 00:56:07,440
Speaker 1: for one, if you're putting out et fs that are

991
00:56:08,040 --> 00:56:12,160
Speaker 1: more interesting in in the way they're assembled and built

992
00:56:12,560 --> 00:56:15,479
Speaker 1: and they're not relying on a ton of leverage. There's

993
00:56:15,560 --> 00:56:18,800
Speaker 1: really very modest risk there, right. The product works or

994
00:56:18,840 --> 00:56:21,120
Speaker 1: it doesn't. It finds an audience or it doesn't. It

995
00:56:21,200 --> 00:56:24,080
Speaker 1: accumulates assets or it doesn't. But none of your e

996
00:56:24,200 --> 00:56:26,640
Speaker 1: t f s are ever going to blow up Oppenheim

997
00:56:26,719 --> 00:56:29,120
Speaker 1: or that we would never play. We would never I

998
00:56:29,160 --> 00:56:31,000
Speaker 1: don't want to play that game, but that that wasn't

999
00:56:31,040 --> 00:56:33,080
Speaker 1: our that was not our space, And I agree with you,

1000
00:56:33,160 --> 00:56:35,600
Speaker 1: it's tough. I don't think investors understand it. I don't

1001
00:56:35,680 --> 00:56:38,400
Speaker 1: think they understand the impact of the leverage you're taking on.

1002
00:56:39,040 --> 00:56:41,040
Speaker 1: It's easy. If you're fifty two one and you drop

1003
00:56:41,239 --> 00:56:45,200
Speaker 1: two per cent, you're gone, You're done, right, Like, wait,

1004
00:56:45,400 --> 00:56:48,000
Speaker 1: two percent drop wipes me out? Oh, I don't want leverage.

1005
00:56:48,040 --> 00:56:50,960
Speaker 1: That's a bad thing. And I think everybody that was

1006
00:56:51,040 --> 00:56:55,160
Speaker 1: the one big takeaway. I thought everybody learned from from

1007
00:56:55,280 --> 00:56:58,719
Speaker 1: the financial crisis. But you're saying risk is now thought

1008
00:56:58,800 --> 00:57:02,239
Speaker 1: of a little more differently at financial institutions. Absolutely, and

1009
00:57:02,360 --> 00:57:05,200
Speaker 1: again part of it is because they knew they needed

1010
00:57:05,280 --> 00:57:07,720
Speaker 1: to to build back trust with clients. I mean again

1011
00:57:07,880 --> 00:57:10,360
Speaker 1: back to our FPS. You know, in the very beginning

1012
00:57:10,400 --> 00:57:13,120
Speaker 1: of the RP, it asks about their risk management process,

1013
00:57:13,160 --> 00:57:16,360
Speaker 1: whether it's the firm overall from a centralized perspective, whether

1014
00:57:16,360 --> 00:57:20,360
Speaker 1: the portfolio management specifically, you've got to articulate your risk

1015
00:57:20,360 --> 00:57:22,680
Speaker 1: management process. And we have that and we're running our

1016
00:57:22,720 --> 00:57:25,480
Speaker 1: rules based strategies. We have that in there as well, right,

1017
00:57:25,600 --> 00:57:28,240
Speaker 1: and index providers have that as well. So it's an

1018
00:57:28,280 --> 00:57:30,520
Speaker 1: important part of the story. You know, again, we are

1019
00:57:30,560 --> 00:57:32,880
Speaker 1: stewards of capital and we are fiduciaries and we need

1020
00:57:32,960 --> 00:57:36,400
Speaker 1: to take that role seriously, not to say the least. Um.

1021
00:57:36,960 --> 00:57:40,760
Speaker 1: The dominance in the E t F space by I

1022
00:57:40,840 --> 00:57:43,760
Speaker 1: almost want to say trilogy, but really it's Van Garden blocked.

1023
00:57:44,360 --> 00:57:47,840
Speaker 1: The Yeah, State Street is up there, but it the

1024
00:57:47,960 --> 00:57:51,520
Speaker 1: two big ones are really um, well, the muscle in

1025
00:57:51,560 --> 00:57:55,200
Speaker 1: the space. How is it that this sector has evolved

1026
00:57:55,320 --> 00:58:01,480
Speaker 1: where it's such a uneven distribution A winner take coal distribution.

1027
00:58:02,480 --> 00:58:05,720
Speaker 1: I mean, look, you know those three firms got started

1028
00:58:05,920 --> 00:58:09,800
Speaker 1: way before everybody else, as you know, spise over years old, right,

1029
00:58:09,960 --> 00:58:12,480
Speaker 1: So I mean there there, there is, there is a

1030
00:58:12,800 --> 00:58:18,560
Speaker 1: a advantage absolutely, um. So part of it is that

1031
00:58:18,920 --> 00:58:21,240
Speaker 1: you know, they certainly won over the early adopters of

1032
00:58:21,320 --> 00:58:24,720
Speaker 1: E t F specifically UM, and they grew their passive

1033
00:58:24,760 --> 00:58:26,880
Speaker 1: business for the first decade, so they just had a

1034
00:58:27,000 --> 00:58:29,840
Speaker 1: giant head start and everybody else's playing catch up. I

1035
00:58:29,880 --> 00:58:33,560
Speaker 1: mean there's well and then the players that got in

1036
00:58:33,680 --> 00:58:37,640
Speaker 1: the market after them. I have a belief set many

1037
00:58:37,800 --> 00:58:40,720
Speaker 1: of them that you know, we actually can evolve our

1038
00:58:40,760 --> 00:58:44,600
Speaker 1: fundamental active franchise. We can do enhanced index, we can

1039
00:58:44,720 --> 00:58:48,600
Speaker 1: do active ETF. So they have sort of by passed

1040
00:58:49,280 --> 00:58:52,760
Speaker 1: the passive to go to alternatively rated or active, something

1041
00:58:52,840 --> 00:58:56,120
Speaker 1: more active, And so there's not a lot of unless

1042
00:58:56,160 --> 00:58:58,760
Speaker 1: you are putting out you know, these vehicles that are

1043
00:58:58,840 --> 00:59:01,960
Speaker 1: for free that you used to allocate internally within your organization,

1044
00:59:02,520 --> 00:59:05,439
Speaker 1: whether you're using them to build model portfolios and charging

1045
00:59:05,480 --> 00:59:10,160
Speaker 1: an overlafy. People aren't jumping on the passive bandwagon, by

1046
00:59:10,240 --> 00:59:12,200
Speaker 1: which State Street vand guard Nice Year has got a

1047
00:59:12,360 --> 00:59:15,480
Speaker 1: very strong early start too, so and most of the

1048
00:59:15,680 --> 00:59:18,480
Speaker 1: pie of the flows every single year go to that.

1049
00:59:18,760 --> 00:59:20,959
Speaker 1: So there are people who are dabbling around the edges

1050
00:59:21,040 --> 00:59:24,360
Speaker 1: to UM try to offer a more sort of UM,

1051
00:59:25,040 --> 00:59:27,720
Speaker 1: you know, fully built out sweet to their clients, but

1052
00:59:27,880 --> 00:59:31,920
Speaker 1: nobody has the scale or can buy or build the

1053
00:59:31,960 --> 00:59:33,600
Speaker 1: scare in a short period of time where they can

1054
00:59:33,680 --> 00:59:36,320
Speaker 1: even make a dent in the market share that that

1055
00:59:36,480 --> 00:59:38,920
Speaker 1: those three organizations have. And I do believe a lot

1056
00:59:39,000 --> 00:59:41,400
Speaker 1: of it was the head start that they got. It

1057
00:59:41,480 --> 00:59:44,520
Speaker 1: makes sense. Before I get to my favorite questions is

1058
00:59:44,560 --> 00:59:46,240
Speaker 1: one of the questions I wanted to ask you about.

1059
00:59:46,880 --> 00:59:49,680
Speaker 1: So you were at F squared UM when they ran

1060
00:59:49,720 --> 00:59:52,640
Speaker 1: into the little difficulties, What was your role and what

1061
00:59:52,840 --> 00:59:57,400
Speaker 1: was your reaction when you've heard about what was happening elsewhere. Yeah, so, uh,

1062
00:59:57,560 --> 00:59:59,400
Speaker 1: that was a big segment of the market, as you

1063
00:59:59,560 --> 01:00:02,920
Speaker 1: recall at F strategis segment which is defined by you know,

1064
01:00:03,000 --> 01:00:05,800
Speaker 1: model portfolios where at least fifty or more has to

1065
01:00:05,840 --> 01:00:08,040
Speaker 1: be with an ETFs. It grew to over a hundred

1066
01:00:08,080 --> 01:00:10,840
Speaker 1: billion UM. Actually F Square was a big client of

1067
01:00:11,160 --> 01:00:13,600
Speaker 1: I Shares, so that's how I knew them. Um they

1068
01:00:13,800 --> 01:00:17,320
Speaker 1: probably gave I Shares directed six st eight billion a year.

1069
01:00:18,000 --> 01:00:21,960
Speaker 1: That number might be slightly off, but anyway, so I

1070
01:00:22,440 --> 01:00:26,280
Speaker 1: they had outsourced everything and they wanted to build their

1071
01:00:26,280 --> 01:00:29,000
Speaker 1: own discretionary business internally. So as hired as the president

1072
01:00:29,400 --> 01:00:31,919
Speaker 1: of F Squared Capital, and I had to build our

1073
01:00:32,120 --> 01:00:36,120
Speaker 1: our trading system higher head trader. UH put in place

1074
01:00:36,160 --> 01:00:40,320
Speaker 1: a portfolio management system with the client service UM group

1075
01:00:40,720 --> 01:00:44,040
Speaker 1: assemble a client service group sales to talk to Wells

1076
01:00:44,120 --> 01:00:48,360
Speaker 1: Fargo's separate account platform business. So I built that lots

1077
01:00:48,400 --> 01:00:51,560
Speaker 1: of moving parts. Was really fun. We grewed almost thirty billion.

1078
01:00:51,680 --> 01:00:55,280
Speaker 1: But the SEC came in in the summer of I

1079
01:00:55,360 --> 01:00:57,960
Speaker 1: hope I get this right summer to do a routine

1080
01:00:58,360 --> 01:01:02,160
Speaker 1: audit and had discovered that the track record we were marketing.

1081
01:01:02,280 --> 01:01:05,240
Speaker 1: This is really important. The tracker we were marketing was

1082
01:01:05,520 --> 01:01:09,200
Speaker 1: went back to two thousand one. The time period in

1083
01:01:09,320 --> 01:01:12,200
Speaker 1: question was two thousand and eight, back to two thousand

1084
01:01:12,240 --> 01:01:14,680
Speaker 1: and one. In two thousand and eight, the CEO of

1085
01:01:14,760 --> 01:01:18,160
Speaker 1: F squared bought a signal from a firm and was

1086
01:01:18,360 --> 01:01:21,919
Speaker 1: told that the signal was run against live client money.

1087
01:01:22,400 --> 01:01:26,160
Speaker 1: Therefore was a live signal two thousand and eight forward. Uh,

1088
01:01:26,360 --> 01:01:29,360
Speaker 1: that was now in the in the domain of F

1089
01:01:29,440 --> 01:01:32,800
Speaker 1: squared and they ran that money at that signal against

1090
01:01:33,200 --> 01:01:36,480
Speaker 1: live client money and live client portfolios. It was Gibbs compliant.

1091
01:01:36,560 --> 01:01:39,000
Speaker 1: It was audited by a big accounting firm. So the

1092
01:01:39,160 --> 01:01:41,480
Speaker 1: SEC had no issue with the track record from two

1093
01:01:41,520 --> 01:01:43,680
Speaker 1: thousand and eight forward. That was valid. It was all

1094
01:01:43,960 --> 01:01:47,760
Speaker 1: based on the purchase and what was represented. That's there

1095
01:01:47,800 --> 01:01:49,880
Speaker 1: was the crux of the matter. So you know that

1096
01:01:50,040 --> 01:01:52,880
Speaker 1: was a disagreement. Yeah, so there was a disagreement. Certainly,

1097
01:01:52,960 --> 01:01:55,240
Speaker 1: the CEO of F squared continued to fight that that

1098
01:01:55,480 --> 01:01:58,280
Speaker 1: it was misrepresented, but the SEC just with the SEC

1099
01:01:58,760 --> 01:02:00,640
Speaker 1: did I mean, they get trade blotters and they get

1100
01:02:00,640 --> 01:02:03,280
Speaker 1: everything they need to do to subpoena people and get

1101
01:02:03,360 --> 01:02:05,000
Speaker 1: to the heart of the matter, even if it is

1102
01:02:05,080 --> 01:02:08,360
Speaker 1: represent if it's misrepresented to you and you go out

1103
01:02:08,360 --> 01:02:11,560
Speaker 1: and represented, that's what they're going to hang their hat on. So, hey,

1104
01:02:11,600 --> 01:02:14,200
Speaker 1: you relied on someone who lied to you, your bed right,

1105
01:02:14,320 --> 01:02:16,400
Speaker 1: so you should have done deeper due diligence or whatever

1106
01:02:16,600 --> 01:02:20,640
Speaker 1: the theory is. So unfortunately, you know, we I still

1107
01:02:20,720 --> 01:02:22,480
Speaker 1: believe to this day that what we were doing in

1108
01:02:22,560 --> 01:02:23,960
Speaker 1: the way in which we were doing it, which was

1109
01:02:24,040 --> 01:02:26,640
Speaker 1: the alpha sector of products, was a prudent way to

1110
01:02:26,760 --> 01:02:29,160
Speaker 1: run a portfolio. Client certainly agreed with that as we

1111
01:02:29,240 --> 01:02:33,120
Speaker 1: grew very quickly. However, um, once they slapped the fine

1112
01:02:33,200 --> 01:02:35,200
Speaker 1: on and they got rid of our CEO and sort

1113
01:02:35,240 --> 01:02:37,080
Speaker 1: of abandoned from the industry and one of the board

1114
01:02:37,120 --> 01:02:39,440
Speaker 1: members came off of the board to be the introm CEO,

1115
01:02:40,000 --> 01:02:42,200
Speaker 1: we really needed to kind of wind the firm down.

1116
01:02:42,640 --> 01:02:44,560
Speaker 1: There was too much damage done. I was going to say,

1117
01:02:44,680 --> 01:02:48,000
Speaker 1: is that recoverable even if it's an innocent mistake? And

1118
01:02:48,120 --> 01:02:50,240
Speaker 1: I don't have any information whether it is or isn't,

1119
01:02:50,600 --> 01:02:54,440
Speaker 1: But when the SEC drops that sort of hammer, is

1120
01:02:54,480 --> 01:02:56,800
Speaker 1: there anything that can be done to done to save

1121
01:02:56,840 --> 01:02:59,280
Speaker 1: a company of that point or is it just all

1122
01:02:59,360 --> 01:03:01,959
Speaker 1: bets are off? Yeah? You know. Look, so to your point, Barry,

1123
01:03:02,040 --> 01:03:06,280
Speaker 1: all two employees approximate to employees were completely innocent. Thankfully,

1124
01:03:06,320 --> 01:03:09,400
Speaker 1: the industry recognized that and gave everybody a free option,

1125
01:03:09,480 --> 01:03:12,960
Speaker 1: and everybody has has gone on to be into really

1126
01:03:13,000 --> 01:03:15,800
Speaker 1: great jobs at other firms. Um. But I think what

1127
01:03:16,000 --> 01:03:19,520
Speaker 1: happened is the trust was just eroded, but from the clients.

1128
01:03:19,600 --> 01:03:22,520
Speaker 1: So clients were starting to pull money. Um, and it

1129
01:03:22,720 --> 01:03:25,200
Speaker 1: was it was too difficult to save. And so we

1130
01:03:25,440 --> 01:03:27,480
Speaker 1: what we did is we hired a banker to do

1131
01:03:27,600 --> 01:03:30,520
Speaker 1: an asset pursage agreement and so sell the remaining assets off.

1132
01:03:31,200 --> 01:03:33,360
Speaker 1: And um, you know, we just it was it was

1133
01:03:33,400 --> 01:03:35,920
Speaker 1: too difficult. So you know, look, I I what I

1134
01:03:36,080 --> 01:03:40,040
Speaker 1: learned through that process was I mean it was excruciating certainly,

1135
01:03:40,720 --> 01:03:44,560
Speaker 1: UM but um, you know, managing through crisis and trying

1136
01:03:44,640 --> 01:03:46,960
Speaker 1: to you know, keep everybody on the boat until such

1137
01:03:47,000 --> 01:03:49,920
Speaker 1: time that you've got to get everybody safely off the boat. UM,

1138
01:03:50,080 --> 01:03:52,160
Speaker 1: and just being really open and honest with clients. I

1139
01:03:52,200 --> 01:03:53,720
Speaker 1: mean clients would take me out to dinner and say

1140
01:03:53,760 --> 01:03:55,400
Speaker 1: what really happened? And I had to say that I

1141
01:03:55,560 --> 01:03:57,880
Speaker 1: actually have no idea. I mean I wasn't here I

1142
01:03:57,960 --> 01:04:04,120
Speaker 1: joined in. Um. But again b B seek solace and

1143
01:04:04,200 --> 01:04:07,280
Speaker 1: knowing that two thousand and eight forward, since F square,

1144
01:04:07,280 --> 01:04:09,320
Speaker 1: it has been running your money. It's been it's been

1145
01:04:09,400 --> 01:04:12,200
Speaker 1: done in in a in a prudent way. So it

1146
01:04:12,360 --> 01:04:14,960
Speaker 1: was tough. But that's an amazing story. Yeah, it's it's

1147
01:04:15,000 --> 01:04:19,920
Speaker 1: certainly the most excruciating chapter of my career. It's for

1148
01:04:20,080 --> 01:04:24,000
Speaker 1: two is that everybody below the CEO managed to continue

1149
01:04:24,040 --> 01:04:27,280
Speaker 1: the career. Everybody's great without that being a black mark. No, no,

1150
01:04:27,400 --> 01:04:29,720
Speaker 1: everybody understands it now. It was sort of isolated to

1151
01:04:29,800 --> 01:04:34,160
Speaker 1: the CEO. Amazing. So let's jump to our favorite questions.

1152
01:04:34,320 --> 01:04:37,120
Speaker 1: These are the things I asked all of our guests.

1153
01:04:37,800 --> 01:04:40,320
Speaker 1: Let's start out with, what was the first car you

1154
01:04:40,440 --> 01:04:48,600
Speaker 1: ever owned? Your making Model seventy four Volkswagen super Beetle. Really,

1155
01:04:48,720 --> 01:04:53,080
Speaker 1: I had a super Beetle. They were indestructible, are absolutely.

1156
01:04:53,200 --> 01:04:57,560
Speaker 1: I had three hundred thousand miles online. I had not

1157
01:04:57,720 --> 01:05:01,880
Speaker 1: a beat seven the four By then they had breakes

1158
01:05:02,000 --> 01:05:04,840
Speaker 1: and radios and air conditioning. I didn't have any of that.

1159
01:05:05,000 --> 01:05:07,320
Speaker 1: Mine was light blue, which god, I had a light

1160
01:05:07,360 --> 01:05:09,840
Speaker 1: blue one. Also I had a white Bug and then

1161
01:05:10,560 --> 01:05:13,720
Speaker 1: a light blue super Beetle. The super Beetle for about

1162
01:05:13,760 --> 01:05:16,080
Speaker 1: six months I was broken, did not have a battery,

1163
01:05:16,520 --> 01:05:19,240
Speaker 1: and I would start parked on a hill and just

1164
01:05:19,360 --> 01:05:21,240
Speaker 1: drop the clutch and that's how I would start the car.

1165
01:05:23,080 --> 01:05:26,120
Speaker 1: It's um literally so so I had no heat, so

1166
01:05:26,240 --> 01:05:30,600
Speaker 1: that was tough. But they were pretty pretty indestructive, absolutely

1167
01:05:30,720 --> 01:05:34,080
Speaker 1: until the floorboards rusted out and became like a flint stone. Right.

1168
01:05:34,920 --> 01:05:37,520
Speaker 1: I had one of those, absolutely, So tell us the

1169
01:05:37,600 --> 01:05:42,080
Speaker 1: most important thing people don't know about? Sharon French. It

1170
01:05:42,160 --> 01:05:44,160
Speaker 1: was funny what the word important? I mean, the most

1171
01:05:44,240 --> 01:05:46,600
Speaker 1: important thing in my life, for sure is that I'm

1172
01:05:46,600 --> 01:05:50,240
Speaker 1: a mom. And but I think most people know. Y, yes,

1173
01:05:50,360 --> 01:05:53,400
Speaker 1: I think most people know that. Um, what else is important?

1174
01:05:54,640 --> 01:05:56,240
Speaker 1: I mean some things people don't know. I don't know

1175
01:05:56,240 --> 01:05:59,320
Speaker 1: how important is I have a titanium hip, so a

1176
01:05:59,360 --> 01:06:01,320
Speaker 1: lot of people called me the bionic woman. When you

1177
01:06:01,440 --> 01:06:04,560
Speaker 1: go through airport security, does that set stuff? Yes, it does.

1178
01:06:04,640 --> 01:06:06,240
Speaker 1: I have to. I have to do the walk through

1179
01:06:06,280 --> 01:06:08,800
Speaker 1: thing where you hold your arms machine. That is the

1180
01:06:09,120 --> 01:06:14,360
Speaker 1: only non invasive imaging technology that has not been f

1181
01:06:14,520 --> 01:06:16,960
Speaker 1: d A approved. And you'll notice when they set the

1182
01:06:17,000 --> 01:06:19,360
Speaker 1: button they kind of lean back, lean away from it

1183
01:06:19,600 --> 01:06:21,600
Speaker 1: because they know that stuff is going to kill them.

1184
01:06:21,680 --> 01:06:25,760
Speaker 1: So I'm I'm the beauty of t s A pre

1185
01:06:26,200 --> 01:06:28,840
Speaker 1: or even better clear is that you don't have to

1186
01:06:28,920 --> 01:06:31,520
Speaker 1: do the naked machine, which does go. But because of

1187
01:06:31,640 --> 01:06:33,440
Speaker 1: my hip and I carry I carry a card to

1188
01:06:33,520 --> 01:06:35,720
Speaker 1: my and my wallet that shows the hip, I have

1189
01:06:35,800 --> 01:06:37,880
Speaker 1: a striker hip, and my doctor's name and everything I've

1190
01:06:37,880 --> 01:06:40,680
Speaker 1: an addressed. Um. But I actually just thinking about it,

1191
01:06:40,720 --> 01:06:42,320
Speaker 1: and this could set up a whole, This could set

1192
01:06:42,360 --> 01:06:44,960
Speaker 1: off a whole another series of questions. An important fact

1193
01:06:45,000 --> 01:06:47,000
Speaker 1: about me that nobody knows that I just found out,

1194
01:06:47,560 --> 01:06:50,040
Speaker 1: and it's a little bit of a family controversy. Family

1195
01:06:50,160 --> 01:06:52,960
Speaker 1: of origin, my my five brothers and sisters or six

1196
01:06:53,000 --> 01:06:56,040
Speaker 1: of us is I did twenty three and me and

1197
01:06:56,160 --> 01:06:58,560
Speaker 1: my whole life. I thought I was a pure bread

1198
01:06:58,800 --> 01:07:06,880
Speaker 1: Irish woman. Apparently not I am Oshgnazi Jew. Really, yes,

1199
01:07:07,200 --> 01:07:11,000
Speaker 1: that's fascinating, that's fascinating. So we had an unbelievable you know,

1200
01:07:11,240 --> 01:07:14,480
Speaker 1: family conversation over Thanksgiving and made my mother Unfortunately my

1201
01:07:14,560 --> 01:07:16,880
Speaker 1: dad has passed, but we made my mother take the

1202
01:07:16,960 --> 01:07:21,840
Speaker 1: test and she surprisingly is fifty percent, which means one

1203
01:07:22,000 --> 01:07:26,040
Speaker 1: of her parents has to be so you know, and

1204
01:07:26,720 --> 01:07:29,920
Speaker 1: which she doesn't. They're both deceased. But we think it's

1205
01:07:29,920 --> 01:07:32,840
Speaker 1: my grandfather. But you know, somebody went astray or this

1206
01:07:33,000 --> 01:07:37,080
Speaker 1: is post World War two or maybe not. So they

1207
01:07:37,120 --> 01:07:41,160
Speaker 1: were born in uh the after the war. People stopped,

1208
01:07:41,440 --> 01:07:44,320
Speaker 1: some people stopped talking. They were born in nineteen oh.

1209
01:07:45,600 --> 01:07:48,480
Speaker 1: My grandparents were born in nineteen o five or six

1210
01:07:48,800 --> 01:07:51,360
Speaker 1: around there. So anyway, so that's an important fact that

1211
01:07:51,440 --> 01:07:53,680
Speaker 1: quite frankly, I didn't even know until recently. If you

1212
01:07:53,720 --> 01:07:58,600
Speaker 1: want to have some fun, google Oshkenazi Jewish nobel recipients.

1213
01:07:58,640 --> 01:08:03,600
Speaker 1: It's there's fastly disproportionate, and I don't know what that's about,

1214
01:08:03,720 --> 01:08:06,080
Speaker 1: but it's kind of it's I just went to the

1215
01:08:06,160 --> 01:08:10,200
Speaker 1: Nobile Museum in Stockholm and the fall was it was fabulous. Second, yeah,

1216
01:08:10,240 --> 01:08:12,400
Speaker 1: I learned a lot um tell us about some of

1217
01:08:12,480 --> 01:08:16,519
Speaker 1: your early mentors who helped shape your career. Yes, yes, so,

1218
01:08:17,120 --> 01:08:22,880
Speaker 1: um Bob Shulman, Robert Shulman. So he was an executive

1219
01:08:23,120 --> 01:08:26,240
Speaker 1: at E. F. Hutton Shearson Lehman Brothers. I think he

1220
01:08:26,400 --> 01:08:29,840
Speaker 1: left before the Smith Barney acquisition to become president and

1221
01:08:30,000 --> 01:08:35,439
Speaker 1: CEO of Tremont Advisors. Um. But he was a very

1222
01:08:35,760 --> 01:08:41,280
Speaker 1: very shrewd, tough boss. He had I had moved into

1223
01:08:41,400 --> 01:08:43,840
Speaker 1: a number of different positions throughout my decade at that

1224
01:08:44,080 --> 01:08:47,560
Speaker 1: organization and really really tough and ran a number of

1225
01:08:47,600 --> 01:08:51,640
Speaker 1: different business units, new product development. He actually was one

1226
01:08:51,680 --> 01:08:55,640
Speaker 1: of the early executives who ran the Smith Barney Consulting

1227
01:08:55,680 --> 01:08:58,760
Speaker 1: Group UM, which was ultimately sold off to I think

1228
01:08:58,800 --> 01:09:01,920
Speaker 1: Bank of New York m Ellen UM. And he was

1229
01:09:02,320 --> 01:09:06,439
Speaker 1: tough as nails and so the reason and we still

1230
01:09:06,600 --> 01:09:10,840
Speaker 1: meet for coffee and and uh lunch today he's retired, UM,

1231
01:09:11,040 --> 01:09:14,400
Speaker 1: but he was. He was instrumental to me because he

1232
01:09:14,680 --> 01:09:17,960
Speaker 1: was so tough. I didn't need coddling. I needed to

1233
01:09:18,560 --> 01:09:22,400
Speaker 1: understand how to be better and do better and UM help.

1234
01:09:22,520 --> 01:09:25,439
Speaker 1: He gave me all kinds of runway. And so my

1235
01:09:25,560 --> 01:09:30,760
Speaker 1: reputation today is sort of somebody who can you know, fixer? Right,

1236
01:09:31,120 --> 01:09:33,080
Speaker 1: I was a question I didn't get to. Your reputation

1237
01:09:33,200 --> 01:09:36,960
Speaker 1: is something's messed up, Send share and she'll fix it. Yeah. Well,

1238
01:09:37,080 --> 01:09:39,200
Speaker 1: and it's and it's fixing and growing or doing the

1239
01:09:39,280 --> 01:09:42,519
Speaker 1: diagnostic in order to remove the obstacle for growth. I mean,

1240
01:09:42,600 --> 01:09:45,840
Speaker 1: I I hope that at some point people see me

1241
01:09:45,880 --> 01:09:49,679
Speaker 1: as somebody who drives profitable growth. But that was Bob,

1242
01:09:50,000 --> 01:09:53,160
Speaker 1: and that was that is who gave me those early

1243
01:09:53,800 --> 01:09:56,479
Speaker 1: you know sort of runways and taught me how to

1244
01:09:56,840 --> 01:10:00,360
Speaker 1: go at the heart of the issue, um and keep harder,

1245
01:10:00,439 --> 01:10:02,960
Speaker 1: keep running stronger. I mean, I certainly he wasn't a

1246
01:10:02,960 --> 01:10:05,240
Speaker 1: lot of people are afraid of him. UM So I

1247
01:10:05,280 --> 01:10:07,080
Speaker 1: wouldn't say that he was the mentor in my life

1248
01:10:07,120 --> 01:10:09,880
Speaker 1: who taught me how to socialize issues and how to

1249
01:10:10,000 --> 01:10:12,400
Speaker 1: get the right key stake overt holders involved and get

1250
01:10:12,439 --> 01:10:15,000
Speaker 1: their buy and that came later. Um. I had a

1251
01:10:15,080 --> 01:10:18,519
Speaker 1: female mentor, Alliance Bernstein. I had a male mentor also

1252
01:10:18,560 --> 01:10:20,800
Speaker 1: to Alliance Bernstein, and I think helped me along in

1253
01:10:20,840 --> 01:10:24,080
Speaker 1: that regard as well. UM So, I'm a big believer

1254
01:10:24,200 --> 01:10:27,439
Speaker 1: in mentors. I'm a big believer in sponsorship. Um And

1255
01:10:27,640 --> 01:10:31,360
Speaker 1: I have mentored a ton of mostly women in my career,

1256
01:10:31,720 --> 01:10:33,560
Speaker 1: which I continue to do and I really believe in

1257
01:10:33,920 --> 01:10:35,760
Speaker 1: because at this stage of my career very to me,

1258
01:10:35,840 --> 01:10:38,320
Speaker 1: it's all about paying it forward. I mean, I I

1259
01:10:38,439 --> 01:10:40,800
Speaker 1: still have a lot more to accomplish, but it's all

1260
01:10:40,840 --> 01:10:45,479
Speaker 1: about inspiring the next generation, which I started a a

1261
01:10:45,760 --> 01:10:48,720
Speaker 1: unit called University Outreach within Women and e t f S,

1262
01:10:48,800 --> 01:10:52,160
Speaker 1: which is actually going to universities at the undergraduate level

1263
01:10:52,840 --> 01:10:56,639
Speaker 1: and mentoring in them and raising their awareness around asset

1264
01:10:56,720 --> 01:10:59,720
Speaker 1: management and et F specifically because a lot of a

1265
01:10:59,800 --> 01:11:01,840
Speaker 1: lot of women who are going into business, I have

1266
01:11:02,000 --> 01:11:05,240
Speaker 1: nowhere to go from there, and business is hard for women.

1267
01:11:05,320 --> 01:11:08,599
Speaker 1: Financial services is still pretty difficult. It's getting better, um,

1268
01:11:08,760 --> 01:11:11,439
Speaker 1: but I I really want to inspire the next generation

1269
01:11:11,520 --> 01:11:14,639
Speaker 1: at the undergraduate level and then mentor younger females who

1270
01:11:14,760 --> 01:11:19,599
Speaker 1: are incredibly smart and promising within this industry. What about

1271
01:11:19,680 --> 01:11:23,919
Speaker 1: investors who influenced the way you look at assets, markets

1272
01:11:24,000 --> 01:11:26,120
Speaker 1: and investment. When I was young, it was Bill Sharp

1273
01:11:26,200 --> 01:11:31,280
Speaker 1: and Harry mark o Witz right Modern Partio, Yes sixty two.

1274
01:11:31,400 --> 01:11:33,679
Speaker 1: So the only startup I did in my career was Empower.

1275
01:11:33,920 --> 01:11:39,240
Speaker 1: That's when I left my wealth management brokerage experience in

1276
01:11:39,320 --> 01:11:41,599
Speaker 1: New York and moved to San Francisco right after AO

1277
01:11:41,800 --> 01:11:45,599
Speaker 1: went public in remember that that really started the whole

1278
01:11:45,600 --> 01:11:50,640
Speaker 1: Internet place. UM and so UM that startup experience was

1279
01:11:51,080 --> 01:11:54,479
Speaker 1: was really really strong, and we partnered with Harry Marko Witz.

1280
01:11:54,920 --> 01:11:59,160
Speaker 1: Our competition with financial engines who partnered with Bill Sharp. UM,

1281
01:11:59,280 --> 01:12:03,240
Speaker 1: I mean more recently, um over the that was probably

1282
01:12:03,360 --> 01:12:06,160
Speaker 1: my second decade. My third decade was more FAMA and

1283
01:12:06,240 --> 01:12:08,680
Speaker 1: French at the University of Chicago and a lot of

1284
01:12:08,720 --> 01:12:11,360
Speaker 1: their factor work. I really do believe in the persistence

1285
01:12:11,400 --> 01:12:14,960
Speaker 1: of factors is a more uh precise way to get

1286
01:12:15,040 --> 01:12:19,200
Speaker 1: at the key drivers of return. Right, Eugene Fama at Chicago,

1287
01:12:19,360 --> 01:12:22,360
Speaker 1: I think Ken French at Dartmouth, Yes, exactly, a tough

1288
01:12:22,400 --> 01:12:28,800
Speaker 1: school and that's quite interesting. Um. Everybody's favorite question, what

1289
01:12:28,920 --> 01:12:31,360
Speaker 1: are some of your favorite books, be they fiction, non fiction,

1290
01:12:31,439 --> 01:12:34,800
Speaker 1: investing related, or whatever. Yeah. So, I'm I really love

1291
01:12:34,920 --> 01:12:39,280
Speaker 1: to learn about people. So I love reading biographies. Um

1292
01:12:39,720 --> 01:12:42,200
Speaker 1: and so I the one I just read was I

1293
01:12:42,320 --> 01:12:46,280
Speaker 1: Love Capitalism by Ken Lango. It was fast. He's a

1294
01:12:46,400 --> 01:12:49,240
Speaker 1: really interesting I'll be a krusty guy. I mean he's

1295
01:12:49,520 --> 01:12:52,680
Speaker 1: sort of like a classic curmudgeon. Lely had the book read.

1296
01:12:52,840 --> 01:12:57,879
Speaker 1: He was scrappy, scrappy. That's the better work to get crusty, scrappy, scrappy.

1297
01:12:58,040 --> 01:12:59,880
Speaker 1: I mean, I could not put it down. I read

1298
01:12:59,920 --> 01:13:02,920
Speaker 1: it three days home. Depot is just amazing. I mean

1299
01:13:02,960 --> 01:13:06,160
Speaker 1: he did so many other things deep absolutely, I mean

1300
01:13:06,280 --> 01:13:09,680
Speaker 1: he put capital together on Wall Street, That's what he did.

1301
01:13:10,160 --> 01:13:13,800
Speaker 1: He was scrappy, he was fearless. He was amazing. Um.

1302
01:13:13,920 --> 01:13:16,800
Speaker 1: So anyway, so, um, I just read Michelle Obama's book,

1303
01:13:16,800 --> 01:13:18,760
Speaker 1: which I thought was great becoming also read that one

1304
01:13:18,800 --> 01:13:23,160
Speaker 1: in three days. Um, Katherine Hepburn, Um, certainly Michael Bloomberg,

1305
01:13:23,360 --> 01:13:29,599
Speaker 1: I'm a giant Katherine Hepburn fane biography, biography, biography, who

1306
01:13:29,640 --> 01:13:33,479
Speaker 1: wrote that? And UM, oh gosh, you're testing me. I

1307
01:13:33,640 --> 01:13:37,639
Speaker 1: just I just don't there's a dozen Katherine Hepburn biography. Yes, Um,

1308
01:13:38,120 --> 01:13:41,160
Speaker 1: I don't remember. Barry I'm sorry, I don't remember. Emailed me.

1309
01:13:41,240 --> 01:13:44,599
Speaker 1: I'll add it to the list. But even Anne Keller,

1310
01:13:44,680 --> 01:13:46,880
Speaker 1: I mean, you know, I mean, I you know, so

1311
01:13:46,960 --> 01:13:51,360
Speaker 1: I'm fascinated by people. So my my my favorite books

1312
01:13:51,400 --> 01:13:54,240
Speaker 1: are actually reading about you know, the bio biography channel

1313
01:13:54,280 --> 01:13:56,479
Speaker 1: I love to listen to. I mean, I certainly have

1314
01:13:56,600 --> 01:13:58,920
Speaker 1: read a lot about the Grateful Dead, going back to music,

1315
01:13:59,080 --> 01:14:02,960
Speaker 1: you know, Jerry Goo see uh, Phil Collins, So I

1316
01:14:03,200 --> 01:14:06,120
Speaker 1: I typically read not, that's a weird that's a weird

1317
01:14:07,160 --> 01:14:12,600
Speaker 1: juxtaposition the dead into Phil. Not exactly. I've got an neglectic,

1318
01:14:12,880 --> 01:14:15,439
Speaker 1: you know, palette. Let's see, I go back to the

1319
01:14:15,880 --> 01:14:19,280
Speaker 1: established that of Genesis and Peter Gabriel, not that I

1320
01:14:19,720 --> 01:14:23,360
Speaker 1: not that I mind super tramp Genesis, that whole that

1321
01:14:23,400 --> 01:14:25,200
Speaker 1: was high school for me. That was my freshman year

1322
01:14:25,200 --> 01:14:28,880
Speaker 1: in college. Breakfast alight. So you're older than me. A touch,

1323
01:14:29,240 --> 01:14:31,920
Speaker 1: just a touch, Um, So, what do you tell us

1324
01:14:31,960 --> 01:14:34,160
Speaker 1: about a time you failed and what you learned from

1325
01:14:34,200 --> 01:14:36,679
Speaker 1: the experience? Are there any other books before we jumped

1326
01:14:36,680 --> 01:14:38,920
Speaker 1: in down? That's that's good. I mean, certainly I read

1327
01:14:38,960 --> 01:14:41,599
Speaker 1: other things other than just biographies. But I think that's

1328
01:14:41,640 --> 01:14:43,760
Speaker 1: the thought I'd like to leave you with. Okay, So

1329
01:14:44,160 --> 01:14:47,120
Speaker 1: let's discuss the time you failed business or not and

1330
01:14:47,240 --> 01:14:52,800
Speaker 1: what you learned from the experience. Gosh, okay. So it's

1331
01:14:52,800 --> 01:14:55,040
Speaker 1: sort of business and personal at the same time. So

1332
01:14:55,439 --> 01:14:56,760
Speaker 1: during that period of time where I was in San

1333
01:14:56,760 --> 01:14:59,040
Speaker 1: Francisco where I was working for Empower and we were

1334
01:14:59,120 --> 01:15:02,080
Speaker 1: we were growing fast us again. Harvard Business Case Study

1335
01:15:02,200 --> 01:15:03,920
Speaker 1: loved it. We ended up selling the business to morning

1336
01:15:03,960 --> 01:15:07,479
Speaker 1: Star ultimately in two thousand one. But um, I was

1337
01:15:07,760 --> 01:15:10,519
Speaker 1: running global sales. I was one of uh. I was

1338
01:15:10,760 --> 01:15:13,240
Speaker 1: you know, I was on the management team employed, you know,

1339
01:15:13,360 --> 01:15:16,479
Speaker 1: fifth member of the management team. UM. And we had

1340
01:15:16,520 --> 01:15:18,879
Speaker 1: built our business domestically and I was starting to establish

1341
01:15:18,920 --> 01:15:21,160
Speaker 1: our business globally. So we I set up I was

1342
01:15:21,240 --> 01:15:23,360
Speaker 1: going back and forth from San Francisco to Tokyo and

1343
01:15:23,360 --> 01:15:26,479
Speaker 1: San Francisco to London. Put up joint ventures in London

1344
01:15:26,560 --> 01:15:28,840
Speaker 1: to grow that and build a subsidiary bricks and mortar

1345
01:15:29,040 --> 01:15:32,960
Speaker 1: in Um sorry, in Asia. We did joint ventures London.

1346
01:15:33,000 --> 01:15:35,960
Speaker 1: We put up a subsidering we had We were a

1347
01:15:36,080 --> 01:15:40,840
Speaker 1: finalist for so Miszooho really came together in two thousand

1348
01:15:40,880 --> 01:15:43,479
Speaker 1: one of his iby J Industrial Bank of Japan, day

1349
01:15:43,600 --> 01:15:47,120
Speaker 1: Chicanga dk B and Fujibank. Those three individual banks came

1350
01:15:47,160 --> 01:15:49,719
Speaker 1: together to form ben zoo Hoo. While they were forming,

1351
01:15:50,320 --> 01:15:53,479
Speaker 1: they were looking for online investment advisory services. We were

1352
01:15:53,680 --> 01:15:55,880
Speaker 1: as one of many things on this platform they were building.

1353
01:15:55,920 --> 01:15:58,000
Speaker 1: We were a finalist. There was two of us at

1354
01:15:58,080 --> 01:16:01,680
Speaker 1: that time. I was pregnant with my daughter, very pregnant, well,

1355
01:16:01,920 --> 01:16:03,840
Speaker 1: started out not so pregnant, but over the course of

1356
01:16:03,880 --> 01:16:10,280
Speaker 1: eight months, I and um I needed to and as

1357
01:16:10,360 --> 01:16:14,120
Speaker 1: if you understand the Japanese culture, they are very much

1358
01:16:14,400 --> 01:16:17,720
Speaker 1: into relationships, right, not that we are in the US,

1359
01:16:17,800 --> 01:16:20,200
Speaker 1: but even more so, much deeper. So when you start

1360
01:16:20,240 --> 01:16:21,800
Speaker 1: with them, you have to end with them or you

1361
01:16:21,880 --> 01:16:24,760
Speaker 1: might as well not compete. And so I was the

1362
01:16:24,840 --> 01:16:27,000
Speaker 1: one who had to hot fly to Tokyo to do

1363
01:16:27,160 --> 01:16:30,560
Speaker 1: this finalist presentation. And I was eight months right, so

1364
01:16:30,960 --> 01:16:36,000
Speaker 1: ps forged the doctor's note. Bad idea. UM. I remember

1365
01:16:36,040 --> 01:16:39,200
Speaker 1: at the time my husband and my son was to saying,

1366
01:16:39,360 --> 01:16:41,800
Speaker 1: you know, if you go you don't get it, we

1367
01:16:41,960 --> 01:16:44,120
Speaker 1: will not be here when you get back. Do you

1368
01:16:44,280 --> 01:16:46,439
Speaker 1: understand that when you fly to New York or London

1369
01:16:46,560 --> 01:16:48,920
Speaker 1: or New York, you're flying over land, So if you

1370
01:16:49,040 --> 01:16:51,040
Speaker 1: go into labor, you have to land the plane and

1371
01:16:51,120 --> 01:16:52,720
Speaker 1: you can land them. I can't land the plane when

1372
01:16:52,720 --> 01:16:58,000
Speaker 1: you're over the that's right, So stupid me I went. Thankfully,

1373
01:16:58,840 --> 01:17:01,560
Speaker 1: The story ends, well, we did win the business and

1374
01:17:01,760 --> 01:17:05,640
Speaker 1: I didn't quinto labor. But I went into labor prematurely

1375
01:17:05,880 --> 01:17:09,000
Speaker 1: two weeks after I got back, and my daughter was fine,

1376
01:17:09,080 --> 01:17:12,720
Speaker 1: she was six pounds. My husband and little boy was

1377
01:17:13,000 --> 01:17:15,000
Speaker 1: were still there, although he didn't talk to me for

1378
01:17:15,040 --> 01:17:17,880
Speaker 1: the following month. But the lesson learned and very I

1379
01:17:18,000 --> 01:17:21,120
Speaker 1: said that I mentor people and women, and many of

1380
01:17:21,200 --> 01:17:23,200
Speaker 1: the things I said them is look avoid the mistakes

1381
01:17:23,280 --> 01:17:27,679
Speaker 1: I made. What was I thinking our number one priorities, ourselves,

1382
01:17:27,720 --> 01:17:31,240
Speaker 1: our healths in our family. That was the stupidest thing

1383
01:17:31,320 --> 01:17:34,600
Speaker 1: I ever did. I put my life at risk and

1384
01:17:34,720 --> 01:17:39,840
Speaker 1: my unborn child's life at risk. Wow, like stupid, that's

1385
01:17:40,040 --> 01:17:44,080
Speaker 1: that's that's pretty bad. That's a horrifying, horrifying story. Again,

1386
01:17:44,120 --> 01:17:47,240
Speaker 1: it worked out, but still, what do you do for fun?

1387
01:17:48,520 --> 01:17:52,840
Speaker 1: What do I do for fund? Listen to music? Um? Look,

1388
01:17:52,920 --> 01:17:56,639
Speaker 1: I'm very sporty, as you say so. I I used

1389
01:17:56,640 --> 01:17:57,760
Speaker 1: to run, but now I have a new hip, so

1390
01:17:57,800 --> 01:18:00,400
Speaker 1: I can't do that anymore. But I do yoga, I

1391
01:18:01,000 --> 01:18:04,160
Speaker 1: do you know, stand up paddle boarding, I ski, um,

1392
01:18:04,520 --> 01:18:11,280
Speaker 1: I you know, snorkele, I, paraglide, I do anything. I

1393
01:18:11,320 --> 01:18:14,200
Speaker 1: don't say no to anything. I don't scuba dive. I've

1394
01:18:14,280 --> 01:18:16,599
Speaker 1: got to get my over my fear of scuba diving.

1395
01:18:17,400 --> 01:18:19,840
Speaker 1: But I'm very sporty, so you know, I'll be on

1396
01:18:19,880 --> 01:18:24,280
Speaker 1: a softball team or I'll you know, um, I'll always

1397
01:18:24,280 --> 01:18:26,639
Speaker 1: say yes if anybody wants my son just jump jumped

1398
01:18:26,640 --> 01:18:27,880
Speaker 1: out of a plane. I don't know if I'm going

1399
01:18:27,960 --> 01:18:30,240
Speaker 1: to do that, but yeah, that's the risk reward on

1400
01:18:30,320 --> 01:18:33,120
Speaker 1: that one is not my my favorite. So our last

1401
01:18:33,200 --> 01:18:35,800
Speaker 1: questions because we have to wrap. Um, what sort of

1402
01:18:35,840 --> 01:18:38,720
Speaker 1: advice would you give any millennial who was thinking of

1403
01:18:38,800 --> 01:18:41,920
Speaker 1: going into a career in finance. Yeah, so, look, it's

1404
01:18:41,960 --> 01:18:44,240
Speaker 1: interesting millennials. You and I grew up with the mutual

1405
01:18:44,280 --> 01:18:46,840
Speaker 1: fund in the eighties. Millennials are growing up with et

1406
01:18:47,000 --> 01:18:50,080
Speaker 1: f s right, and they're growing up with digital advice.

1407
01:18:50,800 --> 01:18:52,960
Speaker 1: Um So. One of the things I like about that

1408
01:18:53,320 --> 01:18:55,760
Speaker 1: is it's it's a lot of the burden of that

1409
01:18:55,920 --> 01:18:58,320
Speaker 1: falls on their shoulders in terms of how they learned

1410
01:18:58,400 --> 01:19:02,519
Speaker 1: to um you know, think about portfolio construction. Um So,

1411
01:19:02,880 --> 01:19:06,120
Speaker 1: I think data and I mean, look, we're sitting at Bloomberg.

1412
01:19:06,200 --> 01:19:09,559
Speaker 1: This is the epicenter of data and intelligence. I am

1413
01:19:09,680 --> 01:19:13,519
Speaker 1: big into how the financial world meets the technology world.

1414
01:19:13,680 --> 01:19:16,439
Speaker 1: So I certainly my passion and my love deep down

1415
01:19:16,520 --> 01:19:19,559
Speaker 1: as asset management, but I love the intersection of finance

1416
01:19:19,600 --> 01:19:23,519
Speaker 1: and technology, So I certainly would um you know, advise

1417
01:19:23,600 --> 01:19:26,439
Speaker 1: them in that direction. And our final question, what is

1418
01:19:26,479 --> 01:19:28,439
Speaker 1: it that you know about the world of investing today

1419
01:19:28,520 --> 01:19:30,519
Speaker 1: that you wish you knew thirty years ago when you

1420
01:19:30,600 --> 01:19:35,320
Speaker 1: first started. I wish I understood risk a little bit more.

1421
01:19:35,520 --> 01:19:37,160
Speaker 1: You know, I sort of thought tree screwed to the

1422
01:19:37,160 --> 01:19:39,320
Speaker 1: sky back then, and you know, I think I was

1423
01:19:39,360 --> 01:19:42,320
Speaker 1: a little bit idealistic at that time. So I'm I'm

1424
01:19:42,479 --> 01:19:44,559
Speaker 1: I've I've been sobered and I've been burned. I mean,

1425
01:19:44,600 --> 01:19:47,240
Speaker 1: I've been through three market corrections that are pretty significant

1426
01:19:47,320 --> 01:19:50,080
Speaker 1: eight seven, two thousand, two thousand one and two eight,

1427
01:19:50,680 --> 01:19:52,599
Speaker 1: as well as market timing scandals and all the things

1428
01:19:52,640 --> 01:19:55,920
Speaker 1: you mentioned. So you know, I'm I'm much more practical now,

1429
01:19:56,040 --> 01:19:58,560
Speaker 1: much more pragmatic, and uh, I wish I knew that

1430
01:19:58,600 --> 01:20:00,360
Speaker 1: back then. I think a lot of you, a younger

1431
01:20:00,400 --> 01:20:04,200
Speaker 1: generation of special millennials, are super idealistic. But having been

1432
01:20:04,280 --> 01:20:06,840
Speaker 1: through what I've been through throughout my career, you know,

1433
01:20:06,960 --> 01:20:10,200
Speaker 1: I wish I learned more earlier on about you know,

1434
01:20:10,400 --> 01:20:14,200
Speaker 1: managing risk better. Really really interesting answer. We have been

1435
01:20:14,280 --> 01:20:17,240
Speaker 1: speaking with Sharon French. She is the head of Beta

1436
01:20:17,320 --> 01:20:22,200
Speaker 1: Solutions at Oppenheimer Funds. If you enjoy this conversation, well,

1437
01:20:22,320 --> 01:20:25,040
Speaker 1: be sure and check out Apple iTunes, uh and look

1438
01:20:25,160 --> 01:20:27,240
Speaker 1: upward down an inch where you can see any of

1439
01:20:27,400 --> 01:20:30,960
Speaker 1: the other two hundred and fifty or so such conversations

1440
01:20:31,040 --> 01:20:36,280
Speaker 1: we've had previously. Uh. You can find that at iTunes, Stitcher, overcast,

1441
01:20:36,320 --> 01:20:40,320
Speaker 1: Bloomberg dot com. We love your comments, feedback and suggestions

1442
01:20:40,640 --> 01:20:44,519
Speaker 1: right to us at m IB podcast at Bloomberg dot net.

1443
01:20:45,160 --> 01:20:47,120
Speaker 1: I would be remiss if I did not thank the

1444
01:20:47,160 --> 01:20:50,760
Speaker 1: crack staff that helps put together these conversations each week.

1445
01:20:51,240 --> 01:20:56,760
Speaker 1: Medina Parwana is our audio engineer. Slash producer Atika val

1446
01:20:56,840 --> 01:21:01,880
Speaker 1: Brun is our project director. Uh Michael Boyle is our booker.

1447
01:21:02,240 --> 01:21:06,160
Speaker 1: Michael Batnick is our head of research. I'm Parry Retolts.

1448
01:21:06,320 --> 01:21:09,400
Speaker 1: You're listening to Masters in Business on Bloomberg Radio.