1 00:00:02,040 --> 00:00:07,160 Speaker 1: This is Mesters in Business with Very Renaults on Bluebird Radio. 2 00:00:08,280 --> 00:00:11,280 Speaker 1: This week on the podcast, I have an extra special guest. 3 00:00:11,760 --> 00:00:14,840 Speaker 1: Her name is Gene Hines and she is the incoming 4 00:00:15,000 --> 00:00:19,720 Speaker 1: CEO of Wellington Management, a nearly hundred year old firm 5 00:00:19,920 --> 00:00:24,520 Speaker 1: which manages over a trillion dollars in assets. Gine is 6 00:00:24,560 --> 00:00:29,040 Speaker 1: a fascinating investors. She's got a great history both as 7 00:00:29,040 --> 00:00:33,600 Speaker 1: she started her early jobs at Wellington, eventually taking over 8 00:00:34,200 --> 00:00:37,479 Speaker 1: the Vanguard Healthcare Fund, the largest healthcare fund in the country. 9 00:00:38,080 --> 00:00:41,760 Speaker 1: As a managing partner at Wellington and soon to be CEO, 10 00:00:42,040 --> 00:00:47,080 Speaker 1: she simply has a unique perspective as to what's going 11 00:00:47,120 --> 00:00:50,960 Speaker 1: on in the world of asset management. That includes everything 12 00:00:51,200 --> 00:00:55,640 Speaker 1: from governance issues, who's becoming CEOs, who's rising up through 13 00:00:55,680 --> 00:01:00,320 Speaker 1: the ranks across the entire industry, what the impact active 14 00:01:00,360 --> 00:01:04,080 Speaker 1: sustainability is going to be on the entire asset management. 15 00:01:04,400 --> 00:01:07,920 Speaker 1: We talk about private equity, we talked about passive versus active, 16 00:01:08,400 --> 00:01:12,360 Speaker 1: pretty much we covered everything there was to discuss about 17 00:01:12,959 --> 00:01:17,280 Speaker 1: investing these days, and really there aren't many people who 18 00:01:17,319 --> 00:01:20,560 Speaker 1: have as unique a perch to look out on the 19 00:01:20,560 --> 00:01:24,959 Speaker 1: world of finance and and have an informed opinion. I 20 00:01:25,000 --> 00:01:27,520 Speaker 1: thought This was a fascinating conversation and I think you 21 00:01:27,600 --> 00:01:31,680 Speaker 1: will too. So, with no further ado, my interview of 22 00:01:31,760 --> 00:01:38,759 Speaker 1: Wellington Managements Gene Hinn. This is Mesters in Business with 23 00:01:38,920 --> 00:01:44,200 Speaker 1: very Results on Bluebird Radio. My extra special guest this 24 00:01:44,240 --> 00:01:48,760 Speaker 1: week is Gene Hynes. She is the incoming CEO of 25 00:01:48,880 --> 00:01:53,480 Speaker 1: Wellington Asset Management. The firm manages over a trillion dollars 26 00:01:53,560 --> 00:01:58,000 Speaker 1: in client assets. She began as an administrative assistant at 27 00:01:58,040 --> 00:02:02,680 Speaker 1: Wellington UH and currently also manages the fifty one billion 28 00:02:02,720 --> 00:02:07,640 Speaker 1: dollar Vanguard Healthcare Fund, the country's largest health care fund. 29 00:02:08,040 --> 00:02:11,760 Speaker 1: She takes over as CEO of this June. Gene Hines, 30 00:02:12,080 --> 00:02:15,280 Speaker 1: Welcome to Bloomberg. Thank you very much, Barry. I'm happy 31 00:02:15,320 --> 00:02:19,280 Speaker 1: to talk touesday. So I'm kind of intrigued by all 32 00:02:19,320 --> 00:02:22,040 Speaker 1: sorts of parts of your career. You come out of 33 00:02:22,040 --> 00:02:25,359 Speaker 1: a college with a degree in economics, but your first 34 00:02:25,440 --> 00:02:30,480 Speaker 1: job is as an administrative assistant. Seems a little disconnected. 35 00:02:30,720 --> 00:02:34,120 Speaker 1: Explained that early career choice. Well, Barry, if I go 36 00:02:34,200 --> 00:02:36,960 Speaker 1: back and maybe just give you some context. You know, 37 00:02:37,000 --> 00:02:41,280 Speaker 1: I'm from I'm a daughter of Irish immigrants, and so 38 00:02:41,400 --> 00:02:43,639 Speaker 1: when I went to Wellesley College on a scholarship, I 39 00:02:43,680 --> 00:02:46,800 Speaker 1: didn't really know anything about the stock market UM, and 40 00:02:47,120 --> 00:02:50,640 Speaker 1: I remember being in the crash of seven. That was 41 00:02:50,720 --> 00:02:54,520 Speaker 1: my first experience and in hearing about what the market is. 42 00:02:54,880 --> 00:02:57,120 Speaker 1: I took a sociology class and was about work, and 43 00:02:57,160 --> 00:02:59,960 Speaker 1: so you had to find an internship at a play 44 00:03:00,160 --> 00:03:03,720 Speaker 1: of work anywhere around Boston, and I found an internship 45 00:03:03,720 --> 00:03:06,240 Speaker 1: at a brokerage firm UM, and that introduced me to 46 00:03:06,240 --> 00:03:09,920 Speaker 1: the market, which I loved UM, and I particularly like 47 00:03:10,000 --> 00:03:12,080 Speaker 1: the research part of it. I wanted to find out 48 00:03:12,360 --> 00:03:15,240 Speaker 1: what made stocks go up and down UM and so 49 00:03:15,440 --> 00:03:19,160 Speaker 1: UM in the context of which was a mini recession. 50 00:03:19,240 --> 00:03:23,079 Speaker 1: If you remember, there weren't many jobs. I went out 51 00:03:23,120 --> 00:03:26,799 Speaker 1: trying to find that job where I could UM, learn 52 00:03:26,840 --> 00:03:30,040 Speaker 1: about the markets and UM and do research UM. I 53 00:03:30,080 --> 00:03:33,280 Speaker 1: was interviewing at two different jobs that they were similar 54 00:03:33,360 --> 00:03:36,040 Speaker 1: jobs who one had a much better title UM and 55 00:03:36,160 --> 00:03:38,840 Speaker 1: one the one at Wellington was an administrative assistant. And 56 00:03:38,840 --> 00:03:42,960 Speaker 1: you have to imagine back in Wellington's UM was under 57 00:03:43,000 --> 00:03:46,200 Speaker 1: three hundred employees were now so it was much as 58 00:03:46,280 --> 00:03:50,880 Speaker 1: much smaller organization, very flat. UM. I didn't know I 59 00:03:50,920 --> 00:03:53,800 Speaker 1: was going to come in and do UM maybe fifty 60 00:03:53,800 --> 00:03:57,800 Speaker 1: percent of my job would be more typical research assistant work. UM. 61 00:03:57,840 --> 00:03:59,960 Speaker 1: And I remember back to the head hunters or tell 62 00:04:00,080 --> 00:04:02,080 Speaker 1: you mean that this is a special space. You're never 63 00:04:02,080 --> 00:04:04,680 Speaker 1: going to regret going to Wellington's. There's gonna be lots 64 00:04:04,680 --> 00:04:07,320 Speaker 1: of growth opportunities for you. UM. And that's why it's 65 00:04:07,320 --> 00:04:09,400 Speaker 1: just a job. And I guess I you know, I 66 00:04:09,760 --> 00:04:13,000 Speaker 1: really did. For the first couple of years, maybe fifty 67 00:04:13,040 --> 00:04:17,440 Speaker 1: percent of the job was administrative. Fift was really getting 68 00:04:17,480 --> 00:04:20,480 Speaker 1: to know the markets and learning how to model and UM. 69 00:04:20,760 --> 00:04:23,760 Speaker 1: And then about eighteen months and I started working with 70 00:04:23,880 --> 00:04:27,320 Speaker 1: Ed Owen. So let's talk a little bit about Ed Owens. 71 00:04:27,360 --> 00:04:31,760 Speaker 1: He has been called the best investor you never heard of. 72 00:04:32,400 --> 00:04:36,679 Speaker 1: He ran the Vanguard Healthcare funds for quite a long time. 73 00:04:37,480 --> 00:04:40,120 Speaker 1: What did you learn from working with Ed? Had the 74 00:04:40,200 --> 00:04:43,880 Speaker 1: privilege of working for Ed for twenty years of my career. UM. 75 00:04:43,960 --> 00:04:46,800 Speaker 1: When I think back, and as I said, I started 76 00:04:47,240 --> 00:04:51,440 Speaker 1: UM working with Ed in early and that was a 77 00:04:51,480 --> 00:04:55,480 Speaker 1: period of UM intense UM. I p O activity in 78 00:04:55,520 --> 00:04:58,200 Speaker 1: the bio in the biotechnology spector. He was the he 79 00:04:58,320 --> 00:05:02,279 Speaker 1: was the analyst, the biotech analysts, he was the pharmaceutical landilists, 80 00:05:02,279 --> 00:05:05,400 Speaker 1: and he also ran the Vanguard Healthcare fund and so 81 00:05:05,440 --> 00:05:07,920 Speaker 1: I just got to go deep with him right from 82 00:05:07,960 --> 00:05:11,240 Speaker 1: the very beginning. Uh, you know, when we started working together, 83 00:05:11,720 --> 00:05:13,279 Speaker 1: if I had to take a step back and say, 84 00:05:13,320 --> 00:05:16,560 Speaker 1: what are the three things that Ed taught me that 85 00:05:16,640 --> 00:05:19,080 Speaker 1: will that sort of live with me now and how 86 00:05:19,120 --> 00:05:21,960 Speaker 1: I both show up as an investor and show up 87 00:05:22,000 --> 00:05:25,560 Speaker 1: as a leader. I think one just the concept of 88 00:05:25,680 --> 00:05:29,600 Speaker 1: very deep research. You know, when we're thinking about how 89 00:05:29,640 --> 00:05:32,000 Speaker 1: we're going to make money for our clients, it's you know, 90 00:05:32,040 --> 00:05:33,960 Speaker 1: how will the fu what will the future hold, what 91 00:05:34,040 --> 00:05:38,560 Speaker 1: will change that is going to UM really create value 92 00:05:38,640 --> 00:05:41,560 Speaker 1: for the world, And I think Ed was early taking 93 00:05:41,560 --> 00:05:44,800 Speaker 1: that perspective UM. I think the other one was also 94 00:05:44,880 --> 00:05:48,640 Speaker 1: following all companies any market cap global. I think he 95 00:05:48,720 --> 00:05:53,160 Speaker 1: was global before UM. Many many investors were global, and 96 00:05:53,320 --> 00:05:56,440 Speaker 1: that really helped us build mosaics. So, for instance, if 97 00:05:56,480 --> 00:05:59,960 Speaker 1: a company was building was working on a specific met 98 00:06:00,000 --> 00:06:02,880 Speaker 1: anism of action for a drug and there was a 99 00:06:02,920 --> 00:06:06,039 Speaker 1: small company in UM San Diego working on it, there 100 00:06:06,120 --> 00:06:08,240 Speaker 1: might be a Japanese company also working on it, and 101 00:06:08,320 --> 00:06:11,640 Speaker 1: that just helped us UM fleshed out what was happening 102 00:06:11,680 --> 00:06:14,640 Speaker 1: and and really trying and really helped us figure out 103 00:06:14,880 --> 00:06:16,960 Speaker 1: who might be the winners. And whether this was really 104 00:06:16,960 --> 00:06:18,520 Speaker 1: going to be a drug, was just really going to 105 00:06:18,640 --> 00:06:21,640 Speaker 1: change medicine, And so I think that sort of deep 106 00:06:21,680 --> 00:06:27,040 Speaker 1: research um and instilled an. Secondly, it's just um, you 107 00:06:27,080 --> 00:06:30,159 Speaker 1: know what value is, So it is a value investor. 108 00:06:30,200 --> 00:06:33,640 Speaker 1: I consider myself a value investor, and that is very 109 00:06:33,720 --> 00:06:36,080 Speaker 1: much linked to trying to see what the future is. 110 00:06:36,160 --> 00:06:38,000 Speaker 1: So what is this company going to be worth it 111 00:06:38,400 --> 00:06:42,280 Speaker 1: if this drug is successful or they or they gained 112 00:06:42,279 --> 00:06:45,200 Speaker 1: this market share in this medical device. And it's not 113 00:06:45,240 --> 00:06:48,599 Speaker 1: necessarily a low pie type of investing. It's really what 114 00:06:48,800 --> 00:06:52,440 Speaker 1: what companies are worth. And and then just really tying 115 00:06:52,520 --> 00:06:54,479 Speaker 1: back to what the stock is that so our job 116 00:06:54,600 --> 00:06:56,800 Speaker 1: is not to predict the future of medicine. Our job 117 00:06:56,880 --> 00:07:00,159 Speaker 1: is to buy stock um, not concepts. So we're or 118 00:07:00,200 --> 00:07:04,359 Speaker 1: is that where is that value versus fundamental um? And 119 00:07:04,360 --> 00:07:06,960 Speaker 1: there has to be room um in the value of 120 00:07:06,960 --> 00:07:09,120 Speaker 1: the enterprise for us to make money for our clients. 121 00:07:09,400 --> 00:07:15,320 Speaker 1: And this finally flexibility. Ed was a very long term, 122 00:07:15,560 --> 00:07:20,680 Speaker 1: low turnover investor, but he was anything but complacent. Um. 123 00:07:20,680 --> 00:07:23,920 Speaker 1: He was just very flexible to change his mind when 124 00:07:23,960 --> 00:07:27,280 Speaker 1: something changed our long term thesis. I think I'm much 125 00:07:27,360 --> 00:07:29,760 Speaker 1: better at that in the past decade. I think that's 126 00:07:29,800 --> 00:07:32,280 Speaker 1: something you learn over time. I think it's a very 127 00:07:32,320 --> 00:07:35,280 Speaker 1: important important in my leadership as well as we think 128 00:07:35,320 --> 00:07:39,160 Speaker 1: about the firm. That sort of flexibility UM is very key. 129 00:07:39,200 --> 00:07:42,440 Speaker 1: So I want to flesh out some of the results 130 00:07:42,520 --> 00:07:46,680 Speaker 1: from that approach to investing in healthcare with some numbers. 131 00:07:46,800 --> 00:07:51,960 Speaker 1: When Ed retired in twelve, the Vanguard Healthcare Fund that 132 00:07:52,120 --> 00:07:56,320 Speaker 1: he was managing was the top performing fund over the 133 00:07:56,360 --> 00:08:00,440 Speaker 1: previous twenty five years, over three thousand per scent for 134 00:08:00,480 --> 00:08:04,560 Speaker 1: an annualized return of more than fourteen point eight percent, 135 00:08:04,880 --> 00:08:09,600 Speaker 1: far ahead of its benchmark or the SMP five. So 136 00:08:10,400 --> 00:08:14,080 Speaker 1: what sort of pressure was it like taking over a 137 00:08:14,120 --> 00:08:17,840 Speaker 1: fund that had those sort of numbers. Well, I I 138 00:08:17,960 --> 00:08:21,000 Speaker 1: worked with Ed, as I said, for twenty years on 139 00:08:21,080 --> 00:08:24,160 Speaker 1: that fund, so I was int you know, very much, 140 00:08:24,280 --> 00:08:27,880 Speaker 1: very closely tied to the research, as well as some 141 00:08:27,920 --> 00:08:29,760 Speaker 1: of my colleagues on the team. So I guess when 142 00:08:29,760 --> 00:08:31,840 Speaker 1: I took over the fund, I just felt very comfortable 143 00:08:31,880 --> 00:08:34,240 Speaker 1: that we had built a team and we had learned 144 00:08:34,360 --> 00:08:37,079 Speaker 1: from Ed, we had the privilege of learning from me 145 00:08:37,200 --> 00:08:40,240 Speaker 1: for twenty years, that we would make him proud and 146 00:08:40,400 --> 00:08:43,480 Speaker 1: and carry on um the you know, carry on the 147 00:08:43,480 --> 00:08:46,440 Speaker 1: great results over over the long term that he has 148 00:08:46,520 --> 00:08:50,320 Speaker 1: created UM. I would say a couple of things as well. UM. 149 00:08:50,360 --> 00:08:53,040 Speaker 1: You know he as I said he for over twenty 150 00:08:53,040 --> 00:08:57,040 Speaker 1: five years. He really brought that very science based long 151 00:08:57,160 --> 00:08:59,960 Speaker 1: term best health care is a growth industry. I think 152 00:09:00,040 --> 00:09:02,480 Speaker 1: it will continue to be a growth industry going forward. 153 00:09:02,559 --> 00:09:05,680 Speaker 1: And so that is you know, really bringing that lens 154 00:09:05,679 --> 00:09:09,480 Speaker 1: to UM to the fund UM. He was also very 155 00:09:09,520 --> 00:09:12,719 Speaker 1: much a contrarian and and again this value investor, and 156 00:09:12,920 --> 00:09:15,920 Speaker 1: you know, when you think back to big, big moves 157 00:09:16,000 --> 00:09:18,400 Speaker 1: in the index, you know he made had made a 158 00:09:18,440 --> 00:09:22,240 Speaker 1: big move in in um N and two thousands towards 159 00:09:22,320 --> 00:09:26,520 Speaker 1: healthcare services and medical technology, which had been very much 160 00:09:26,559 --> 00:09:29,400 Speaker 1: out of favor for many years UM. And that was 161 00:09:31,400 --> 00:09:34,720 Speaker 1: of the index back in thousand. Now it's closer to 162 00:09:35,440 --> 00:09:40,120 Speaker 1: So that shift to looking broader than just the pharmaceutical companies. Also, 163 00:09:40,559 --> 00:09:44,840 Speaker 1: you know served us well during that period really interesting. 164 00:09:44,960 --> 00:09:50,760 Speaker 1: And you became one of Wellington's three managing partners. What 165 00:09:50,880 --> 00:09:56,400 Speaker 1: has that experience been like knowing that you're the key 166 00:09:57,160 --> 00:10:02,439 Speaker 1: troika that's responsible for directing over a trillion dollars. So 167 00:10:02,440 --> 00:10:06,720 Speaker 1: so one of Wellington's core edges is our private partnership structure, 168 00:10:07,280 --> 00:10:10,120 Speaker 1: and that structure has been in place now for almost 169 00:10:10,160 --> 00:10:14,560 Speaker 1: forty two years. It's it's UM gone global, it's it's 170 00:10:14,559 --> 00:10:17,839 Speaker 1: scaled us to a trillion dollars UM. And I would say, 171 00:10:18,160 --> 00:10:22,240 Speaker 1: you know, the the concepts of the private partnership structure 172 00:10:22,240 --> 00:10:26,839 Speaker 1: have been in place now for forty years, forty plus years. UM. 173 00:10:26,880 --> 00:10:30,120 Speaker 1: The three managing partners are responsible for the governance of 174 00:10:30,160 --> 00:10:33,800 Speaker 1: the partnership. And I guess now after my seventh year 175 00:10:33,800 --> 00:10:36,960 Speaker 1: of being a managing partner, I just really appreciate, you know, 176 00:10:37,320 --> 00:10:41,080 Speaker 1: one the brilliance of our partnership structure, UM. The fact 177 00:10:41,200 --> 00:10:44,640 Speaker 1: that UM, you know, the partners, those the partners and 178 00:10:44,679 --> 00:10:47,920 Speaker 1: the employees need to trust us to do our homework 179 00:10:47,960 --> 00:10:52,880 Speaker 1: and leave our biases, UM, you know, leave our biases behind. UM. 180 00:10:53,000 --> 00:10:55,000 Speaker 1: So again, when I think about my last seven years, 181 00:10:55,040 --> 00:10:57,920 Speaker 1: I've just learned so much about the business the manager. 182 00:10:58,440 --> 00:11:02,240 Speaker 1: It's about what people the coming um partners and becoming 183 00:11:02,280 --> 00:11:06,199 Speaker 1: managing directors. And it's about sharing the economics of the firm. 184 00:11:06,280 --> 00:11:10,679 Speaker 1: And so again those two things being their fair UM. 185 00:11:10,880 --> 00:11:15,240 Speaker 1: Knowing that businesses can make right decisions are things that 186 00:11:14,280 --> 00:11:17,360 Speaker 1: have that have helped me be one of you know, 187 00:11:18,080 --> 00:11:20,600 Speaker 1: helped me be one of those managing partners that are 188 00:11:20,720 --> 00:11:24,679 Speaker 1: our partners trust. Quite interesting, So let's talk a little 189 00:11:24,679 --> 00:11:29,280 Speaker 1: bit about Wellington's. I know they have a big birthday 190 00:11:29,360 --> 00:11:32,280 Speaker 1: coming up soon to be a hundred years old. Having 191 00:11:32,360 --> 00:11:35,920 Speaker 1: that sort of history, what does that mean to the firm? 192 00:11:36,240 --> 00:11:38,679 Speaker 1: So our our hundred year anniversary is still a few 193 00:11:38,720 --> 00:11:43,240 Speaker 1: years off. We trace our roots back to when Walter 194 00:11:43,400 --> 00:11:47,679 Speaker 1: Morrigan founded the first balanced mutual fund, which is now 195 00:11:48,120 --> 00:11:52,439 Speaker 1: the Wellington's Fund that is sponsored by Vanguard. Our modern 196 00:11:52,520 --> 00:11:55,040 Speaker 1: history of the firm is almost forty two years old 197 00:11:55,080 --> 00:11:59,600 Speaker 1: when we formed our private partnership and took the company 198 00:11:59,760 --> 00:12:04,800 Speaker 1: from being all being private partnership back in nine and 199 00:12:04,920 --> 00:12:07,560 Speaker 1: the firm currently is running over a trillion dollars in 200 00:12:07,640 --> 00:12:11,000 Speaker 1: client assets. Tell us about some of your clients. I 201 00:12:11,080 --> 00:12:15,280 Speaker 1: know that pensions and endowments and foundations as well as 202 00:12:15,320 --> 00:12:20,079 Speaker 1: other global wealth managers are some of the clients of Wellington's. 203 00:12:20,280 --> 00:12:23,240 Speaker 1: So what we do one thing um at Wellington and 204 00:12:23,280 --> 00:12:26,000 Speaker 1: have to manage money for our clients. Um. We have 205 00:12:26,120 --> 00:12:29,960 Speaker 1: a large subadvisory business in the US and around the world. 206 00:12:30,559 --> 00:12:33,880 Speaker 1: We have a very large institutional business and that's from 207 00:12:33,960 --> 00:12:39,720 Speaker 1: governments around the world to pension funds to endowments and foundations. 208 00:12:39,840 --> 00:12:42,199 Speaker 1: We as you mentioned, we have a growing private wealth 209 00:12:42,240 --> 00:12:46,160 Speaker 1: business for private banks. UM. Again, our singular focuses on 210 00:12:46,200 --> 00:12:50,480 Speaker 1: providing investment content investment products, and I think that singular 211 00:12:50,520 --> 00:12:54,360 Speaker 1: focus really helps us deliver investment excellence over time for 212 00:12:54,400 --> 00:12:57,120 Speaker 1: our for our clients around the world. So one of 213 00:12:57,160 --> 00:13:02,600 Speaker 1: your largest clients is Vanguard. That's a longstanding relationship. Obviously, 214 00:13:03,080 --> 00:13:07,880 Speaker 1: Jack Bogel came out of Wellington to launch Vanguard. Tell 215 00:13:07,960 --> 00:13:12,800 Speaker 1: us about the relationship between Wellington Management and the Vanguard Group. 216 00:13:13,240 --> 00:13:16,120 Speaker 1: So Barry, as he said, as he said, Vanguard and 217 00:13:16,120 --> 00:13:20,959 Speaker 1: Wellington had very similar routes back in when Walter and 218 00:13:21,000 --> 00:13:24,000 Speaker 1: Morgan founded the company, and we went different paths in 219 00:13:24,040 --> 00:13:28,720 Speaker 1: the nineteen seventies, with Wellington focused on investment management and 220 00:13:28,800 --> 00:13:34,360 Speaker 1: investment content and Vanguard focusing on the mutual fund distribution business. UM. 221 00:13:34,559 --> 00:13:37,679 Speaker 1: I would say we have a very very strong partnership. 222 00:13:38,040 --> 00:13:41,360 Speaker 1: There are our largest clients, UM, and I just have 223 00:13:41,520 --> 00:13:44,719 Speaker 1: enormous respect for how well they've done as a business. UM. 224 00:13:44,760 --> 00:13:47,880 Speaker 1: And so you know, our goal with Vanguard is to 225 00:13:47,880 --> 00:13:52,160 Speaker 1: to really make sure that we're delivering investment excellence over 226 00:13:52,600 --> 00:13:54,280 Speaker 1: over the long term. And I would say, one of 227 00:13:54,280 --> 00:13:56,920 Speaker 1: the things that I really appreciate appreciate about Vanguard is 228 00:13:56,960 --> 00:13:59,959 Speaker 1: they really have a very long term horizon and they 229 00:14:00,120 --> 00:14:03,280 Speaker 1: are evaluating us on five years and ten years. And 230 00:14:03,320 --> 00:14:06,199 Speaker 1: I think that that that sort of partnership sert us 231 00:14:06,240 --> 00:14:11,319 Speaker 1: well over time. Interesting you mentioned earlier that Wellington is 232 00:14:11,400 --> 00:14:16,360 Speaker 1: a partnership, not publicly traded. I have to imagine that 233 00:14:16,480 --> 00:14:20,160 Speaker 1: over time there were offers to either go public or 234 00:14:20,200 --> 00:14:25,400 Speaker 1: to be sold. Why stay private? What's the advantage of that? 235 00:14:25,800 --> 00:14:29,040 Speaker 1: So one of the most important advantages of staying private 236 00:14:29,280 --> 00:14:32,240 Speaker 1: is that we can be very long term, long term 237 00:14:32,240 --> 00:14:35,720 Speaker 1: in our investment horizons, long term and how we evaluate 238 00:14:35,760 --> 00:14:39,760 Speaker 1: our talent um and thatt I that really does align 239 00:14:40,240 --> 00:14:42,360 Speaker 1: with the long term objectives of our clients. So what 240 00:14:42,400 --> 00:14:44,720 Speaker 1: are our what are we trying to do? We were 241 00:14:44,760 --> 00:14:49,240 Speaker 1: trying to deliver investment results, investment outcomes for our clients, 242 00:14:49,280 --> 00:14:52,680 Speaker 1: and ultimately there and beneficiaries which which which could be 243 00:14:52,760 --> 00:14:57,720 Speaker 1: retail individual investors um around the world, that could be pensioners, um. 244 00:14:57,800 --> 00:15:01,320 Speaker 1: And and they have very very their time horizons are 245 00:15:01,360 --> 00:15:04,360 Speaker 1: extremely long term. And so again I think our private 246 00:15:04,360 --> 00:15:06,920 Speaker 1: partnerships serves us quite well, and it might be the 247 00:15:06,960 --> 00:15:11,680 Speaker 1: optimal structure UM to run an investment UM asset management business. 248 00:15:11,920 --> 00:15:13,920 Speaker 1: And I would say the other thing is that this 249 00:15:14,000 --> 00:15:16,640 Speaker 1: is not a capital heavy business, so we know we 250 00:15:16,680 --> 00:15:20,520 Speaker 1: don't rely on the financial markets or or banks for 251 00:15:20,800 --> 00:15:23,400 Speaker 1: to run our business. And so again there was never 252 00:15:23,440 --> 00:15:26,280 Speaker 1: any necessity. And then maybe one final thing is that 253 00:15:26,360 --> 00:15:31,600 Speaker 1: we have grown organically because I started we were approximately 254 00:15:31,680 --> 00:15:34,120 Speaker 1: sixty billion, and as you said, we're over a trillion 255 00:15:34,160 --> 00:15:38,840 Speaker 1: dollars now. UM. That's all been through organic growth, adding 256 00:15:38,960 --> 00:15:42,680 Speaker 1: talent um along the way to grow, to globalize or 257 00:15:42,720 --> 00:15:46,320 Speaker 1: grow our fixed income business. And again we haven't needed. 258 00:15:46,360 --> 00:15:49,160 Speaker 1: We now have at at our size, we have the 259 00:15:49,200 --> 00:15:53,080 Speaker 1: global scale to invest in our business without relying on 260 00:15:53,120 --> 00:15:55,640 Speaker 1: the market. So tell us a little bit about the 261 00:15:55,680 --> 00:15:59,680 Speaker 1: firm's morning meeting. It's been described as a quote signature 262 00:15:59,720 --> 00:16:02,480 Speaker 1: of tell us a little bit about that. So we 263 00:16:02,520 --> 00:16:05,120 Speaker 1: start the morning meeting has been going on to ninety 264 00:16:05,240 --> 00:16:09,240 Speaker 1: eight UM. It is something that has started in UM 265 00:16:09,240 --> 00:16:12,000 Speaker 1: in our Boston office, but now also happens we have 266 00:16:12,040 --> 00:16:16,360 Speaker 1: an Eurasian morning meeting that happens in our London Eurasia 267 00:16:16,360 --> 00:16:18,680 Speaker 1: meeting that happens in our London and that connects to 268 00:16:18,720 --> 00:16:23,120 Speaker 1: our Asia offices. It's really a place to get together 269 00:16:23,400 --> 00:16:26,960 Speaker 1: and UM debate what's happening in the markets, whether that's 270 00:16:27,120 --> 00:16:31,600 Speaker 1: UM individual stocks or individual credits, or individual or what's 271 00:16:31,640 --> 00:16:35,760 Speaker 1: happening on a macro level. UM. It really does bring 272 00:16:35,800 --> 00:16:39,720 Speaker 1: the firm together in terms of a focus on on 273 00:16:39,720 --> 00:16:42,760 Speaker 1: on how you know the news of the day. Sometimes 274 00:16:42,760 --> 00:16:46,880 Speaker 1: those meetings they're very topical and sometimes they are forward 275 00:16:46,920 --> 00:16:50,680 Speaker 1: looking and we try to share unfinished ideas. I think 276 00:16:50,840 --> 00:16:53,800 Speaker 1: most importantly, Verry, if I could leave you with one 277 00:16:53,840 --> 00:16:56,600 Speaker 1: thing about our firm is that we have a very 278 00:16:57,200 --> 00:17:01,880 Speaker 1: collaborative culture. And what that means is that there's no 279 00:17:02,040 --> 00:17:08,000 Speaker 1: chief investment officer UM. Each individual portfolio manager we have 280 00:17:08,040 --> 00:17:12,000 Speaker 1: about fifty plus boutiques UM can go back and practice 281 00:17:12,040 --> 00:17:15,040 Speaker 1: their own philosophy and process. But we have this open, 282 00:17:15,240 --> 00:17:19,360 Speaker 1: collaborative platform and Morning Meeting is is critical part of that. 283 00:17:19,480 --> 00:17:24,000 Speaker 1: And what you want is debate and challenge on any topic. 284 00:17:24,200 --> 00:17:26,560 Speaker 1: And I think over the I think the Morning Meeting 285 00:17:26,600 --> 00:17:31,399 Speaker 1: has allowed that that forum where UM portfolio managers and 286 00:17:31,440 --> 00:17:34,840 Speaker 1: analysts can can have debates and have different views and 287 00:17:34,960 --> 00:17:38,600 Speaker 1: different perspectives UM. I think that has really helped our 288 00:17:38,640 --> 00:17:44,639 Speaker 1: collaborative platform. And you mentioned attracting talent. What has it 289 00:17:44,680 --> 00:17:49,320 Speaker 1: been like this year to attract or develop and retain 290 00:17:49,480 --> 00:17:53,760 Speaker 1: talent given the challenges of the pandemic and having to 291 00:17:54,480 --> 00:17:59,320 Speaker 1: work remotely, not necessarily being able to interview people face 292 00:17:59,400 --> 00:18:02,359 Speaker 1: to face, what's it been like this best year? But 293 00:18:02,440 --> 00:18:05,800 Speaker 1: we have a tracted so again, as you said, it's 294 00:18:05,840 --> 00:18:11,480 Speaker 1: surprising how you know, we're almost a year into really 295 00:18:11,560 --> 00:18:15,360 Speaker 1: having to work from home and and we've been able 296 00:18:15,400 --> 00:18:19,159 Speaker 1: to run the firm virtually and that includes attracting talent 297 00:18:19,320 --> 00:18:22,920 Speaker 1: from all over the globe. So we have onboarded well 298 00:18:22,960 --> 00:18:27,280 Speaker 1: over a hundred people in and even more starting in 299 00:18:27,320 --> 00:18:31,119 Speaker 1: twenty one, and so that's has seen seamless. But again, 300 00:18:31,200 --> 00:18:33,399 Speaker 1: the most important thing is how do you integrate them? 301 00:18:33,440 --> 00:18:36,280 Speaker 1: And how do you integrate them um into your teams. 302 00:18:36,280 --> 00:18:38,520 Speaker 1: We've had two new team members on the health care team, 303 00:18:38,600 --> 00:18:41,880 Speaker 1: so I know, first Ham, we're trying to integrate them 304 00:18:41,960 --> 00:18:45,399 Speaker 1: into our processes and into our team culture. UM. And 305 00:18:45,440 --> 00:18:47,960 Speaker 1: again I think it takes work. It takes it takes 306 00:18:48,000 --> 00:18:50,480 Speaker 1: work to make sure that you're connecting and you're getting 307 00:18:50,480 --> 00:18:52,679 Speaker 1: to know them and that you're spending a lot of 308 00:18:52,720 --> 00:18:56,399 Speaker 1: time with them. UM. I think the apprenticeship model is 309 00:18:56,480 --> 00:18:58,880 Speaker 1: one of the things that we will as we think 310 00:18:58,920 --> 00:19:02,760 Speaker 1: about the future of work that will be very important 311 00:19:02,800 --> 00:19:05,919 Speaker 1: to having in person, both the combination of both in 312 00:19:05,960 --> 00:19:10,000 Speaker 1: person and potentially more flexibility in the future. But again, 313 00:19:10,040 --> 00:19:13,040 Speaker 1: we've we've we've done, we've we've tried a lot of 314 00:19:13,080 --> 00:19:16,360 Speaker 1: different things that make sure we are both integrating new 315 00:19:16,400 --> 00:19:20,080 Speaker 1: talent as well as keeping teams together during this pandemic, 316 00:19:20,119 --> 00:19:23,919 Speaker 1: and technology has really helped, and it's really a lot 317 00:19:24,040 --> 00:19:28,240 Speaker 1: of every day making sure people are connecting either through 318 00:19:28,240 --> 00:19:31,480 Speaker 1: our morning meeting as we talked about, or through more 319 00:19:31,600 --> 00:19:35,560 Speaker 1: team meetings, or through one on one conversation. So you're 320 00:19:36,000 --> 00:19:41,200 Speaker 1: founded in Philadelphia, headquartered in Boston. How has the pandemic 321 00:19:41,920 --> 00:19:46,440 Speaker 1: changed how you recruit and retain people? Does it open 322 00:19:46,560 --> 00:19:50,160 Speaker 1: up more opportunities? I do think what we've learned from 323 00:19:50,160 --> 00:19:53,320 Speaker 1: the from working from home is that you know, one, 324 00:19:53,600 --> 00:19:58,920 Speaker 1: the technology work, so we can work more virtually UM 325 00:19:59,119 --> 00:20:02,960 Speaker 1: and and we can we can we can be more 326 00:20:02,960 --> 00:20:07,359 Speaker 1: flexible in terms of UM how we use technology to interact. 327 00:20:07,680 --> 00:20:10,800 Speaker 1: So I would suspect first of all, will there will 328 00:20:10,840 --> 00:20:13,879 Speaker 1: be more flexibility in the workforce, and that does allow 329 00:20:14,040 --> 00:20:17,840 Speaker 1: us to think about other locations where we can attract 330 00:20:17,840 --> 00:20:21,600 Speaker 1: talent so other other parts of other parts of the 331 00:20:21,680 --> 00:20:25,440 Speaker 1: US where we don't have UM, we don't have offices. 332 00:20:25,480 --> 00:20:28,160 Speaker 1: That's something we're looking at. No decisions have been made, 333 00:20:28,200 --> 00:20:30,480 Speaker 1: but that's something that I would suspect will look at 334 00:20:30,520 --> 00:20:33,280 Speaker 1: over time UM as well as other parts of the 335 00:20:33,320 --> 00:20:35,639 Speaker 1: world where we don't have offices, Like how how do 336 00:20:35,720 --> 00:20:37,960 Speaker 1: we how do we take a fresh look. We have 337 00:20:38,040 --> 00:20:40,960 Speaker 1: a group of our leaders now studying we have a 338 00:20:40,960 --> 00:20:44,200 Speaker 1: business challenge, studying the future of work UM. I think 339 00:20:44,200 --> 00:20:47,080 Speaker 1: in the next couple of months will will see what's there. 340 00:20:47,119 --> 00:20:49,720 Speaker 1: And they've done such extensive work in terms of serving 341 00:20:50,160 --> 00:20:52,960 Speaker 1: other companies and serving our employees, and I think they'll 342 00:20:53,000 --> 00:20:56,560 Speaker 1: come recommendations about how will work in the future. And 343 00:20:56,640 --> 00:21:00,000 Speaker 1: I assume we'll have more flexibility and that will allow 344 00:21:00,080 --> 00:21:03,000 Speaker 1: us to think more broadly about where our employees are located. 345 00:21:03,240 --> 00:21:07,919 Speaker 1: So what's going on Gene in the health care industry today? 346 00:21:07,960 --> 00:21:12,119 Speaker 1: What insights do we have on the vaccine and innovation? 347 00:21:12,720 --> 00:21:16,760 Speaker 1: This has really been a hell of a year for healthcare. Yes, Berry, 348 00:21:16,960 --> 00:21:19,119 Speaker 1: I think when you think about health care, and I 349 00:21:19,119 --> 00:21:23,359 Speaker 1: did mention earlier that healthcare is a growth industry and 350 00:21:23,400 --> 00:21:26,320 Speaker 1: what I mean by that is that when you think 351 00:21:26,359 --> 00:21:29,959 Speaker 1: about demand, what with the population aging as well as 352 00:21:30,000 --> 00:21:33,240 Speaker 1: in many many and virgin markets such as China, more 353 00:21:33,320 --> 00:21:37,280 Speaker 1: people entering the middle class. That just increases health care demand. 354 00:21:37,400 --> 00:21:41,480 Speaker 1: So health care demand is increasing at a brisk rate, 355 00:21:41,640 --> 00:21:45,480 Speaker 1: and then we have payers around the world try to 356 00:21:45,520 --> 00:21:48,680 Speaker 1: figure out how to control that natural growth of health care. 357 00:21:49,200 --> 00:21:51,359 Speaker 1: So that's what's on the demand side. I think on 358 00:21:51,440 --> 00:21:53,960 Speaker 1: the on the supply side, we are in and I 359 00:21:54,200 --> 00:21:56,919 Speaker 1: really like to say we are in a revolutionary period 360 00:21:57,000 --> 00:21:59,760 Speaker 1: of biology. And so when you when you talk about 361 00:21:59,760 --> 00:22:04,040 Speaker 1: the bio pharmacide by a pharmaceutical side of healthcare, Um, 362 00:22:04,080 --> 00:22:07,200 Speaker 1: this is the most exciting period in my five plus 363 00:22:07,400 --> 00:22:13,600 Speaker 1: years of following the industry. And I think in that technology. 364 00:22:13,800 --> 00:22:16,639 Speaker 1: The power of that technology really came through when you 365 00:22:16,640 --> 00:22:20,280 Speaker 1: think about how fast um, the vaccines and the and 366 00:22:20,320 --> 00:22:23,400 Speaker 1: the antibodies, and you know how fast they were able 367 00:22:23,400 --> 00:22:27,280 Speaker 1: to be developed during this pandemic. So last year m 368 00:22:27,600 --> 00:22:30,240 Speaker 1: r NA was the new tech. It really showed its 369 00:22:30,280 --> 00:22:35,000 Speaker 1: stuff in developing the COVID vaccine. What are some of 370 00:22:35,000 --> 00:22:39,000 Speaker 1: the next great healthcare technologies? What when are the nanobots 371 00:22:39,040 --> 00:22:44,920 Speaker 1: gonna eat the cholesterol that's built up in people's vascular systems? 372 00:22:45,280 --> 00:22:48,040 Speaker 1: Or is it something else entirely Yeah, I think if 373 00:22:48,040 --> 00:22:50,680 Speaker 1: we take a step back and think about the history 374 00:22:50,880 --> 00:22:56,560 Speaker 1: of biopharmaceutical and you had small molecule drugs that those 375 00:22:56,600 --> 00:23:00,320 Speaker 1: are small drugs like you know advil or aspirint and 376 00:23:00,359 --> 00:23:03,679 Speaker 1: then in the nineties you have the discovery of that 377 00:23:03,720 --> 00:23:06,480 Speaker 1: you could deliver proteins, and the late ninety nineties you 378 00:23:06,560 --> 00:23:10,840 Speaker 1: have the discovery that you could um deliver monoclon landi bodies, 379 00:23:10,840 --> 00:23:14,480 Speaker 1: which we went after much larger receptors UM in the body. 380 00:23:14,600 --> 00:23:17,480 Speaker 1: That has opened up biology UM. So again, when you 381 00:23:17,480 --> 00:23:20,560 Speaker 1: think about the past twenty years, it's it's been the 382 00:23:20,600 --> 00:23:23,840 Speaker 1: growth in the industry and the and really being able 383 00:23:23,880 --> 00:23:26,840 Speaker 1: to treat many different diseases has been about using these 384 00:23:26,880 --> 00:23:30,840 Speaker 1: biologic um to treat diseases. I think we're in a 385 00:23:31,240 --> 00:23:34,159 Speaker 1: we're in a completely new era now in when you 386 00:23:34,200 --> 00:23:37,560 Speaker 1: think about the ability to target d NA and in 387 00:23:37,640 --> 00:23:41,439 Speaker 1: a completely new way. So we think about those the 388 00:23:41,600 --> 00:23:45,199 Speaker 1: history of all medicines, those three modalities, and now we 389 00:23:45,320 --> 00:23:50,679 Speaker 1: have small interfering RNA as you mentioned, messenger RNA, gene 390 00:23:50,720 --> 00:23:55,840 Speaker 1: therapy eventually cristoper. We have new modalities called bispecific antibizes 391 00:23:55,880 --> 00:23:59,960 Speaker 1: which targets to targets at once, and even small molecules. 392 00:24:00,040 --> 00:24:03,560 Speaker 1: Because you understand biology at at a completely new level, 393 00:24:04,040 --> 00:24:07,919 Speaker 1: small molecules are are becoming more targeted with less side effects. 394 00:24:08,280 --> 00:24:12,320 Speaker 1: And so when you look forward to the next twenty years, UM, 395 00:24:12,359 --> 00:24:15,120 Speaker 1: as we unravel biology, we're just going to have many, 396 00:24:15,160 --> 00:24:18,400 Speaker 1: many more modalities. UM, I'm not sure. I'm not sure 397 00:24:18,400 --> 00:24:21,200 Speaker 1: if we're going to have nanobos, but I do think 398 00:24:21,600 --> 00:24:26,160 Speaker 1: that these technology platforms will be used broadly across all 399 00:24:26,200 --> 00:24:29,040 Speaker 1: diseases to treat diseases. And I think if we look 400 00:24:29,080 --> 00:24:32,600 Speaker 1: back thirty years from now, we will have made a 401 00:24:32,680 --> 00:24:38,480 Speaker 1: substantial in roads into disease and treating disease and UM 402 00:24:38,520 --> 00:24:41,560 Speaker 1: and that's that's very exciting and encouraging, and we'll create 403 00:24:41,560 --> 00:24:44,920 Speaker 1: a lot of value for the industry. What about oncology 404 00:24:44,960 --> 00:24:47,720 Speaker 1: and cancer, We we've seen a lot of progress, but 405 00:24:47,840 --> 00:24:50,840 Speaker 1: it turns out cancer is not one disease but hundreds 406 00:24:50,880 --> 00:24:53,960 Speaker 1: of diseases. What are we looking at in that space 407 00:24:54,040 --> 00:24:58,800 Speaker 1: and how important is genomics for pursuing a broader cure 408 00:24:58,840 --> 00:25:02,520 Speaker 1: for cancer? So when you think back to ten years ago, 409 00:25:02,680 --> 00:25:07,080 Speaker 1: cancer was treated with UM with chemotherapy, which are like 410 00:25:07,119 --> 00:25:12,160 Speaker 1: poisons and chemotherapy really has resulted in you know, really 411 00:25:12,200 --> 00:25:16,439 Speaker 1: controlling cancer or treat helping to treat cancer. But it's 412 00:25:16,440 --> 00:25:19,960 Speaker 1: been the past ten years where you've you've used you've 413 00:25:20,000 --> 00:25:23,840 Speaker 1: had the ability to use genomics and use genetic information 414 00:25:24,400 --> 00:25:28,480 Speaker 1: to both understand how why cancers grow. And like you said, 415 00:25:28,640 --> 00:25:31,520 Speaker 1: it's you know, breast cancer or lung cancer is not 416 00:25:31,640 --> 00:25:33,800 Speaker 1: just just because it's in the lung doesn't mean it's 417 00:25:33,800 --> 00:25:36,840 Speaker 1: being driven by the same kinds of mutations. And so 418 00:25:37,119 --> 00:25:41,600 Speaker 1: just a better understanding of my patients UM what's driving 419 00:25:41,640 --> 00:25:46,560 Speaker 1: their cancers has led to much better identification of targets 420 00:25:46,560 --> 00:25:50,520 Speaker 1: and much better identication of drugs. And so when you 421 00:25:50,560 --> 00:25:53,720 Speaker 1: think about cancer now you have you still have chemotherapy 422 00:25:53,880 --> 00:25:57,560 Speaker 1: as a backbone. You have immuno oncology which helps the 423 00:25:57,600 --> 00:26:02,199 Speaker 1: immune system UM overcome UMM overcome the cancers, and you 424 00:26:02,280 --> 00:26:07,560 Speaker 1: have targeted therapies in terms of UM driver mutations, the 425 00:26:07,600 --> 00:26:10,840 Speaker 1: ability to target those UM driving mutations. I think in 426 00:26:10,880 --> 00:26:13,840 Speaker 1: the future some of the interesting areas are going to 427 00:26:13,880 --> 00:26:17,879 Speaker 1: be UM antibody antibody drug conjugates, which is more precisely 428 00:26:17,960 --> 00:26:22,200 Speaker 1: delivering chemo through an antibody. Though that though those platforms 429 00:26:22,200 --> 00:26:26,399 Speaker 1: I think will expand going forward you have you know, 430 00:26:26,480 --> 00:26:30,280 Speaker 1: they're the first of carts. I think those those could 431 00:26:30,320 --> 00:26:33,920 Speaker 1: possibly be used much more broadly and other and other 432 00:26:34,040 --> 00:26:36,760 Speaker 1: diseases as well. So I think we're on the We're 433 00:26:36,800 --> 00:26:40,920 Speaker 1: on the brink of really making dramatic changes in ecology. 434 00:26:40,960 --> 00:26:44,040 Speaker 1: And interestingly, when you look at the industry, when you 435 00:26:44,080 --> 00:26:47,400 Speaker 1: look at the biotechnology industry, I think half the companies 436 00:26:47,440 --> 00:26:51,399 Speaker 1: are oncology based and approximately half of a half of 437 00:26:51,560 --> 00:26:53,879 Speaker 1: R and D spending in the industry is oncology. So 438 00:26:54,320 --> 00:26:57,520 Speaker 1: when you think about the combination of really unmet medical 439 00:26:57,680 --> 00:27:04,080 Speaker 1: need and um being very susceptible or driven by genetic mutation, 440 00:27:04,640 --> 00:27:08,960 Speaker 1: that's the perfect marriage in terms of really making progress. 441 00:27:09,960 --> 00:27:12,879 Speaker 1: M quite quite interesting. So what does this mean for 442 00:27:13,160 --> 00:27:18,240 Speaker 1: longevity and future lifespans? Are we looking at someone being 443 00:27:18,280 --> 00:27:22,360 Speaker 1: born today with the high probability of reaching a hundred 444 00:27:23,320 --> 00:27:27,320 Speaker 1: I I always suspect that lifespans are going to be 445 00:27:27,480 --> 00:27:31,240 Speaker 1: prolonged going forward. I think you're you're already seeing that. 446 00:27:31,320 --> 00:27:34,160 Speaker 1: I think that just recently the death rate from cancer 447 00:27:34,280 --> 00:27:37,000 Speaker 1: has a clined in the last five years. We just 448 00:27:37,040 --> 00:27:40,840 Speaker 1: talked about the number of new technologies, So you're already 449 00:27:40,880 --> 00:27:42,800 Speaker 1: seeing it in the data, So that would be one. 450 00:27:43,359 --> 00:27:46,840 Speaker 1: I think that also the the ability to have gene 451 00:27:46,880 --> 00:27:51,919 Speaker 1: therapy for these are hundred monogenic diseases that potentially could 452 00:27:52,560 --> 00:27:56,560 Speaker 1: be susceptible to a technology like geen therapy. That if 453 00:27:56,560 --> 00:28:00,399 Speaker 1: you give those two newborns, that could dramatically change um 454 00:28:00,480 --> 00:28:05,520 Speaker 1: the lifespan and the quality of the lifespan of individuals 455 00:28:05,560 --> 00:28:10,120 Speaker 1: with those genetic mutations. So that would be another area UM. 456 00:28:10,359 --> 00:28:13,040 Speaker 1: And I think when you think about the large um 457 00:28:13,720 --> 00:28:17,800 Speaker 1: large parts of the market that really drive mortality, you know, 458 00:28:17,920 --> 00:28:23,320 Speaker 1: really really it's UM. It's cancer, and it's also cardiovascular disease. 459 00:28:23,359 --> 00:28:27,080 Speaker 1: And I think we've made progress in terms of congestive 460 00:28:27,080 --> 00:28:30,160 Speaker 1: part failure and in blood pressure, and so again, if 461 00:28:30,200 --> 00:28:33,280 Speaker 1: we can crack those and you have more people at 462 00:28:33,320 --> 00:28:36,760 Speaker 1: an earlier stage controlling all of those risk factors, that 463 00:28:36,840 --> 00:28:39,560 Speaker 1: will also likely lead to longer lives in the future. 464 00:28:40,440 --> 00:28:44,680 Speaker 1: Quite quite interesting. So let's talk a little bit about Wellington. 465 00:28:45,000 --> 00:28:48,120 Speaker 1: I think of you guys as an investor in the 466 00:28:48,200 --> 00:28:52,280 Speaker 1: public spaces, but you have a pretty robust business in 467 00:28:52,480 --> 00:28:56,240 Speaker 1: alternative assets like private equity and venture capital. I think 468 00:28:56,280 --> 00:28:59,360 Speaker 1: that's over thirty billion dollars. Now, tell us a little 469 00:28:59,360 --> 00:29:03,360 Speaker 1: bit about what's attractive in that space, and so we 470 00:29:03,440 --> 00:29:06,720 Speaker 1: have an over thirty billion dollars at alternatives, which are 471 00:29:06,720 --> 00:29:10,120 Speaker 1: both UM long short funds as well as UM an 472 00:29:10,120 --> 00:29:14,480 Speaker 1: emerging private equity business. If I think about the private 473 00:29:14,520 --> 00:29:17,560 Speaker 1: equity business, UM, we and you mentioned that we were 474 00:29:17,600 --> 00:29:20,720 Speaker 1: a public company. One of the things that we started, 475 00:29:21,120 --> 00:29:24,000 Speaker 1: you know, right around two thousand and fourteen is fifteen 476 00:29:24,120 --> 00:29:27,440 Speaker 1: is is launching a late stage crossover fund. So that 477 00:29:27,520 --> 00:29:30,560 Speaker 1: was our first private funds. You know, came out of 478 00:29:30,600 --> 00:29:34,920 Speaker 1: the observation that companies were staying private longer and there 479 00:29:34,960 --> 00:29:37,360 Speaker 1: weren't as many I p O s and it was 480 00:29:37,400 --> 00:29:42,680 Speaker 1: a very natural adjacency to our to our public investing UM. 481 00:29:42,680 --> 00:29:45,760 Speaker 1: We've just launched the third of that platform UM and 482 00:29:45,800 --> 00:29:47,920 Speaker 1: a few years ago we also launched the first of 483 00:29:47,920 --> 00:29:52,000 Speaker 1: a biology based private funds UM. Again, I think the 484 00:29:52,000 --> 00:29:54,920 Speaker 1: big observation when you step back is that there are 485 00:29:54,960 --> 00:29:57,800 Speaker 1: more companies staying private longer, There are more companies that 486 00:29:57,800 --> 00:30:01,040 Speaker 1: are private UM. When I when I think of biotechnology, 487 00:30:01,080 --> 00:30:04,160 Speaker 1: there are more private companies relative to public companies now 488 00:30:04,200 --> 00:30:07,040 Speaker 1: than any part in my career. UM. So it is 489 00:30:07,040 --> 00:30:11,280 Speaker 1: a very right area for investing it and it really 490 00:30:11,480 --> 00:30:14,360 Speaker 1: is very much aligned with how we invest in the 491 00:30:14,360 --> 00:30:18,600 Speaker 1: public market. Um, it's very adjacent to our public market investing, 492 00:30:18,960 --> 00:30:21,520 Speaker 1: and I think if you think about wellingting going forward, 493 00:30:21,560 --> 00:30:25,760 Speaker 1: we'll have more platforms beyond those first two. It's an 494 00:30:25,760 --> 00:30:29,000 Speaker 1: area that we're investing in as a firm. So some 495 00:30:29,080 --> 00:30:32,720 Speaker 1: of the older alternatives that are out there, hedge funds 496 00:30:32,840 --> 00:30:36,400 Speaker 1: seem to have gotten very crowded over the past twenty years, 497 00:30:36,480 --> 00:30:39,720 Speaker 1: and and some people have argued the same is true 498 00:30:39,760 --> 00:30:42,720 Speaker 1: for the venture capital side. A lot of money is 499 00:30:42,800 --> 00:30:46,640 Speaker 1: chasing only a finite amount of deals. What does the 500 00:30:46,920 --> 00:30:50,520 Speaker 1: risk look like in private equity? Is there the possibility 501 00:30:50,600 --> 00:30:55,480 Speaker 1: that that becomes a crowded space. Also, I'll go back 502 00:30:55,520 --> 00:30:58,560 Speaker 1: to what I've talked about in terms of a number 503 00:30:58,640 --> 00:31:02,080 Speaker 1: of private companies. So again, when we think about our 504 00:31:02,120 --> 00:31:06,280 Speaker 1: process and think about Wellington's very rooted process in terms 505 00:31:06,320 --> 00:31:11,080 Speaker 1: of both valuation and assessing fundamentals, I think we think 506 00:31:11,080 --> 00:31:14,960 Speaker 1: that there's plenty of opportunity right now for using our 507 00:31:15,040 --> 00:31:19,280 Speaker 1: skills as public investors, using the skills we've generated, you know, 508 00:31:20,040 --> 00:31:23,480 Speaker 1: skills we've told you know, skills we've honed over many, 509 00:31:23,520 --> 00:31:26,440 Speaker 1: many years, to apply those to the private market. And 510 00:31:26,480 --> 00:31:30,520 Speaker 1: I think the observation about maybe the productivity of the world, 511 00:31:30,520 --> 00:31:33,320 Speaker 1: that there are just a number of private you know, 512 00:31:33,400 --> 00:31:36,040 Speaker 1: a larger number of private companies than probably any time 513 00:31:36,040 --> 00:31:40,320 Speaker 1: in history UM and and creating real value for the world, 514 00:31:40,320 --> 00:31:44,640 Speaker 1: and that that's the opportunity really interesting. Let's talk a 515 00:31:44,680 --> 00:31:49,880 Speaker 1: little bit about sustainable investing. Wellington is known for its 516 00:31:49,880 --> 00:31:55,080 Speaker 1: sustainability and alternatives approaches. You guys have a partnership with 517 00:31:55,200 --> 00:31:58,880 Speaker 1: Woodwell Climate Research Center. What are some of the physical 518 00:31:58,920 --> 00:32:03,239 Speaker 1: effects of climate change on capital markets? How how has 519 00:32:03,280 --> 00:32:07,400 Speaker 1: climate change affecting asset prices? So, UM, let me take 520 00:32:07,440 --> 00:32:09,800 Speaker 1: a step back and talk about sustainability and then talk 521 00:32:09,840 --> 00:32:14,200 Speaker 1: about our would Well Climate Research partnership and then how 522 00:32:14,240 --> 00:32:18,520 Speaker 1: it impacts UM the market. UM. In terms of sustainability, 523 00:32:18,600 --> 00:32:21,640 Speaker 1: it's it's I would say that it's broad. It's it's 524 00:32:21,680 --> 00:32:24,840 Speaker 1: if you think about E, S and G, environment, social 525 00:32:24,920 --> 00:32:28,880 Speaker 1: and governance. UM. I think governance has been UM, you know, 526 00:32:29,080 --> 00:32:31,960 Speaker 1: an important part of our process for the past twenty 527 00:32:32,000 --> 00:32:34,360 Speaker 1: five years. Governance has always been important important part of 528 00:32:34,360 --> 00:32:36,800 Speaker 1: our process. That we now have more, we now define 529 00:32:36,840 --> 00:32:40,120 Speaker 1: it more and we are interacting as a firm more 530 00:32:40,360 --> 00:32:44,160 Speaker 1: with companies as well as boards. In terms of in 531 00:32:44,280 --> 00:32:47,760 Speaker 1: terms of our oversight of governance of our of our holdings, 532 00:32:47,760 --> 00:32:50,240 Speaker 1: and I think that will continue. Um. I think in 533 00:32:50,280 --> 00:32:54,960 Speaker 1: the last number of years the environmental has really become 534 00:32:55,560 --> 00:32:59,280 Speaker 1: quite important in terms of, you know, new regulations being 535 00:32:59,280 --> 00:33:02,120 Speaker 1: put in place in in certain parts of the world. 536 00:33:02,600 --> 00:33:06,000 Speaker 1: And again that we have this very exciting partnership with 537 00:33:06,000 --> 00:33:09,160 Speaker 1: would Well Climate Research Center, and we're working with a 538 00:33:09,200 --> 00:33:12,160 Speaker 1: few of our clients on this partnership and we're asking 539 00:33:12,240 --> 00:33:17,320 Speaker 1: questions such as how does climate impact asset prices, and 540 00:33:17,360 --> 00:33:22,840 Speaker 1: they just spend fascinating insights into how water shorter shortage 541 00:33:22,840 --> 00:33:26,840 Speaker 1: for example, or heat map. So we're we're bringing that 542 00:33:26,960 --> 00:33:32,800 Speaker 1: climate research down to very specific parts of geographies and 543 00:33:32,840 --> 00:33:35,960 Speaker 1: then connecting them and trying to connect them then to well, 544 00:33:36,000 --> 00:33:38,360 Speaker 1: this businesses in this geography and it's not going to 545 00:33:38,440 --> 00:33:42,520 Speaker 1: have an impact potentially on municipal bonds for example, or 546 00:33:42,560 --> 00:33:45,520 Speaker 1: even on the equities um in the in the in 547 00:33:45,560 --> 00:33:48,200 Speaker 1: the media too long term. So that what we're trying 548 00:33:48,240 --> 00:33:50,440 Speaker 1: to do is take those insights, make sure we're asking 549 00:33:50,480 --> 00:33:53,920 Speaker 1: the right questions, take those insights and bring it down 550 00:33:54,080 --> 00:33:59,880 Speaker 1: to very specific mapping of climate risks, and then trying 551 00:34:00,040 --> 00:34:04,920 Speaker 1: to connect back to actual stocks and credits UM and 552 00:34:04,960 --> 00:34:07,320 Speaker 1: so we are in the in the process of doing that. 553 00:34:07,360 --> 00:34:11,000 Speaker 1: It's a very exciting partnership UM. And we're also doing 554 00:34:11,040 --> 00:34:14,560 Speaker 1: with that data doing climate reviews of our portfolios. So 555 00:34:14,800 --> 00:34:17,839 Speaker 1: again what our portfolios look like from a climate perspective. 556 00:34:18,800 --> 00:34:21,239 Speaker 1: If I take a very big step back, I think 557 00:34:21,239 --> 00:34:24,840 Speaker 1: the next the next stage will be social and you know, again, 558 00:34:25,280 --> 00:34:29,160 Speaker 1: how how does social interact with the public markets UM, 559 00:34:29,200 --> 00:34:32,319 Speaker 1: And I would suspect starry that we are going UM 560 00:34:32,320 --> 00:34:35,680 Speaker 1: that sustain ability is UM is not a fad, A's 561 00:34:35,719 --> 00:34:39,040 Speaker 1: here to stay and it is really going to impact 562 00:34:39,600 --> 00:34:43,600 Speaker 1: how the markets evolved in terms of where assets go 563 00:34:43,719 --> 00:34:46,799 Speaker 1: into what kind of funds. And so it's a very 564 00:34:46,840 --> 00:34:51,000 Speaker 1: important area of investment for Wellington in terms of you know, 565 00:34:51,080 --> 00:34:54,640 Speaker 1: both talent in terms of the talent that comes with E. 566 00:34:54,920 --> 00:34:59,239 Speaker 1: S G background, as well as a technology investment for 567 00:34:59,320 --> 00:35:01,920 Speaker 1: us in terms of how we can use our climate 568 00:35:02,320 --> 00:35:06,799 Speaker 1: for example, or our governance insights into portfolio construction. UM. 569 00:35:06,800 --> 00:35:09,160 Speaker 1: I think if we're early in the process, but eventually 570 00:35:09,200 --> 00:35:12,360 Speaker 1: it will become part of the dialogue of all stocks 571 00:35:12,600 --> 00:35:15,279 Speaker 1: UM in a number of years. So in June you 572 00:35:15,400 --> 00:35:19,560 Speaker 1: take over for Brended Swords as Wellington's fifth CEO since 573 00:35:19,640 --> 00:35:24,040 Speaker 1: the firm went private nine. You're the first woman to 574 00:35:24,160 --> 00:35:27,040 Speaker 1: serve in that capacity. You're only one of two female 575 00:35:27,080 --> 00:35:32,960 Speaker 1: CEOs amongst the largest asset managers. UH. What does this 576 00:35:33,080 --> 00:35:37,480 Speaker 1: tell us about governance as an issue both in corporate 577 00:35:37,480 --> 00:35:42,239 Speaker 1: America generally but in the finance sector specifically. So I'm 578 00:35:42,239 --> 00:35:44,440 Speaker 1: going to answer that in two parts. One would be 579 00:35:44,719 --> 00:35:48,000 Speaker 1: very Wellington specific and then maybe one about a comment 580 00:35:48,040 --> 00:35:52,359 Speaker 1: about UM corporate, you know, the world of corporations and 581 00:35:52,480 --> 00:35:57,480 Speaker 1: what the future might hold UM from from a Wellington perspective. UM, 582 00:35:57,600 --> 00:35:59,520 Speaker 1: as you said, I'm going to be the fifth generation 583 00:36:00,239 --> 00:36:04,000 Speaker 1: CEO of the of the private partnership eras in ninety nine. 584 00:36:04,080 --> 00:36:06,200 Speaker 1: I think the most important thing to know is we 585 00:36:06,400 --> 00:36:10,240 Speaker 1: really value stewardship. We really really value passing the baton 586 00:36:10,320 --> 00:36:13,600 Speaker 1: to the next generation, leaving the partnership in a better place. 587 00:36:13,680 --> 00:36:17,480 Speaker 1: Like my goal is that this partnership in this firm 588 00:36:17,560 --> 00:36:21,080 Speaker 1: will be thriving fifty years from now. So that's very 589 00:36:21,120 --> 00:36:25,200 Speaker 1: important in terms of that's a very well in specific 590 00:36:25,600 --> 00:36:28,600 Speaker 1: stewardship of the firm. UM. If I shift and think 591 00:36:28,640 --> 00:36:31,680 Speaker 1: about governance, you know, I you know, I just have 592 00:36:31,719 --> 00:36:34,600 Speaker 1: an observation you know, I think it is a novelty 593 00:36:34,719 --> 00:36:38,920 Speaker 1: now that as a female becoming a CEO, and it's 594 00:36:39,040 --> 00:36:41,759 Speaker 1: very exciting to see a number of peers in the 595 00:36:41,760 --> 00:36:44,440 Speaker 1: industry and in the other in other in other industries 596 00:36:44,480 --> 00:36:47,760 Speaker 1: becoming CEOs And hopefully, hopefully it will be a novel 597 00:36:47,920 --> 00:36:50,320 Speaker 1: it won't be such a novelty in ten years. And 598 00:36:50,320 --> 00:36:52,560 Speaker 1: the observation I'm going to make and I and I 599 00:36:52,960 --> 00:36:55,680 Speaker 1: and I, it's an observation based on seeing what's happening 600 00:36:55,680 --> 00:36:59,799 Speaker 1: in the healthcare industry um and seeing broader data, is 601 00:36:59,800 --> 00:37:03,160 Speaker 1: that I do think it's more women in all industries 602 00:37:03,320 --> 00:37:06,480 Speaker 1: have more experience running parts of the business where we 603 00:37:06,520 --> 00:37:10,640 Speaker 1: are going to see more females become CEOs and and 604 00:37:10,680 --> 00:37:13,680 Speaker 1: hopefully I'm you know, hopefully ten years from now, there 605 00:37:13,680 --> 00:37:16,880 Speaker 1: will be a lot more deserving women who have had 606 00:37:16,920 --> 00:37:20,000 Speaker 1: the opportunity to run business is being prepared to be 607 00:37:20,080 --> 00:37:22,879 Speaker 1: CEOs of corporations around the world. You know, when I 608 00:37:22,920 --> 00:37:25,799 Speaker 1: think about myself being a managing partner that we talked 609 00:37:25,800 --> 00:37:29,560 Speaker 1: about earlier, that really provided me that experience. That experience 610 00:37:29,600 --> 00:37:32,800 Speaker 1: for me, it really brought in my perspective and I 611 00:37:32,840 --> 00:37:35,200 Speaker 1: got to know the firm and got to know both 612 00:37:35,200 --> 00:37:37,520 Speaker 1: the clients and the firm and the talent throughout the 613 00:37:37,600 --> 00:37:42,400 Speaker 1: organization that has helped me prepare for for the next UM, 614 00:37:42,560 --> 00:37:46,400 Speaker 1: for the for the upcoming succession from Brendan. That's quite interesting. 615 00:37:47,040 --> 00:37:50,680 Speaker 1: So over the past UM, let's call a decade or so, 616 00:37:50,680 --> 00:37:54,600 Speaker 1: certainly since the Great Financial Crisis, we've seen a lot 617 00:37:54,680 --> 00:37:59,080 Speaker 1: of assets flow towards passive. You guys seem to have 618 00:37:59,120 --> 00:38:02,759 Speaker 1: done pretty well l as an active manager. What are 619 00:38:02,800 --> 00:38:07,239 Speaker 1: you doing to compete more effectively against passive? Is that 620 00:38:07,280 --> 00:38:10,759 Speaker 1: going to be an ongoing shift or is this eventually 621 00:38:10,760 --> 00:38:14,040 Speaker 1: going to reach some form of equilibrium. I strongly believe 622 00:38:14,080 --> 00:38:18,759 Speaker 1: there's a very important place for active management UM. There's 623 00:38:18,800 --> 00:38:22,319 Speaker 1: also a very important place for passive. And it's our 624 00:38:22,400 --> 00:38:25,239 Speaker 1: job at Wellington being an active manager and that that 625 00:38:25,360 --> 00:38:28,480 Speaker 1: is our strategy going forward to how do we how 626 00:38:28,480 --> 00:38:31,880 Speaker 1: do we deliver UM, how do we help our clients 627 00:38:32,000 --> 00:38:35,200 Speaker 1: UM achieve their investment outcomes? And when you think about 628 00:38:35,200 --> 00:38:38,040 Speaker 1: our clients and again back to what are we trying 629 00:38:38,080 --> 00:38:39,920 Speaker 1: to do for clients? We're trying to help them with 630 00:38:39,960 --> 00:38:44,120 Speaker 1: their their future liabilities or you know, how how do 631 00:38:44,160 --> 00:38:46,759 Speaker 1: they fund their pension funds for example, or how do 632 00:38:46,840 --> 00:38:51,080 Speaker 1: people retire with more assets so they can live a 633 00:38:51,160 --> 00:38:55,000 Speaker 1: fulfilling retirement. That's what we're trying to do, and we 634 00:38:55,080 --> 00:38:59,160 Speaker 1: believe that we can deliver our investment excellence that the 635 00:38:59,239 --> 00:39:02,160 Speaker 1: alpha part of the alpha party, the equation will become 636 00:39:02,239 --> 00:39:05,160 Speaker 1: even more important going forward. So when you think about 637 00:39:05,160 --> 00:39:08,560 Speaker 1: where interest rates are, you know, what is the outlook 638 00:39:08,640 --> 00:39:13,800 Speaker 1: for bond returns going forward? When interest rates are um 639 00:39:13,840 --> 00:39:17,040 Speaker 1: you know, close to work, close to zero uh. With 640 00:39:17,160 --> 00:39:20,200 Speaker 1: the equity market, you know, having a strong run for 641 00:39:20,239 --> 00:39:23,799 Speaker 1: the past twelve years, we think alpha will become an 642 00:39:23,840 --> 00:39:27,400 Speaker 1: even more important part of the outcome for our clients. 643 00:39:27,440 --> 00:39:30,200 Speaker 1: And so again maths are that's where our that's our 644 00:39:30,280 --> 00:39:34,560 Speaker 1: number one focused investment excellence. We can deliver our clients. 645 00:39:34,760 --> 00:39:37,600 Speaker 1: We will do well and help them solve their problems, 646 00:39:38,120 --> 00:39:40,839 Speaker 1: hopefully gain more of their trust and gain for their 647 00:39:40,880 --> 00:39:46,040 Speaker 1: business over time. That's interesting you mentioned interest rates. How 648 00:39:46,120 --> 00:39:50,400 Speaker 1: much attention do you pay to the macro? Does is 649 00:39:50,440 --> 00:39:54,879 Speaker 1: what the Federal Reserve is doing? Um impact how you 650 00:39:55,400 --> 00:39:58,640 Speaker 1: adjust your portfolios. Do you think about the state of 651 00:39:58,680 --> 00:40:03,240 Speaker 1: economy or is all that stuff background and you focus 652 00:40:03,280 --> 00:40:06,759 Speaker 1: on finding companies at the right valuations. So I'll talk 653 00:40:06,800 --> 00:40:09,719 Speaker 1: about Wellington and then I'll talk about Jean and how 654 00:40:09,920 --> 00:40:13,840 Speaker 1: she incorporate, how I incorporate interest, race and what is 655 00:40:13,840 --> 00:40:16,560 Speaker 1: happening at the at the macro level. So we have 656 00:40:16,920 --> 00:40:20,160 Speaker 1: half of our business is fixed incomes, so what happens 657 00:40:20,160 --> 00:40:23,120 Speaker 1: on the Federal reserve or the European government is critical 658 00:40:23,360 --> 00:40:26,560 Speaker 1: to investing UM in fixed incomes. So it's a very 659 00:40:26,600 --> 00:40:29,920 Speaker 1: important part of our dialogue at the firm. We have, 660 00:40:30,120 --> 00:40:33,840 Speaker 1: you know, a very strong macro research effort at Wellington 661 00:40:33,960 --> 00:40:37,160 Speaker 1: to help support um are both our equity as well 662 00:40:37,200 --> 00:40:40,200 Speaker 1: as our fixed income and credit at fixing race investors 663 00:40:40,200 --> 00:40:43,760 Speaker 1: as well as our credit investors UM with your investment. 664 00:40:43,800 --> 00:40:49,120 Speaker 1: So for the firm, macro investing is very important UM. 665 00:40:49,160 --> 00:40:52,360 Speaker 1: I would say for for myself as a health care investor, 666 00:40:52,480 --> 00:40:56,439 Speaker 1: I probably would lean more that's fundamentals than we talked 667 00:40:56,440 --> 00:40:59,160 Speaker 1: about health care what's happening. I would spend most of 668 00:40:59,200 --> 00:41:02,880 Speaker 1: my time thinking about what's happening with mechanism of action 669 00:41:03,000 --> 00:41:05,759 Speaker 1: or how cancer is going to be cured. That's that's 670 00:41:05,800 --> 00:41:08,960 Speaker 1: the most important thing to get right. But I found 671 00:41:08,960 --> 00:41:12,120 Speaker 1: it very important over my career to make sure that 672 00:41:12,160 --> 00:41:14,600 Speaker 1: you're focused on the macro. And there are probably two 673 00:41:14,600 --> 00:41:19,280 Speaker 1: macro things one would be, UM, what's happening in regulations 674 00:41:19,320 --> 00:41:22,680 Speaker 1: around the world, regulatory bodies, what's happening in politics. That's 675 00:41:22,680 --> 00:41:26,960 Speaker 1: a big important macro um effort for us in terms 676 00:41:27,040 --> 00:41:31,239 Speaker 1: of understanding what could influence healthcare fundamental. And then its 677 00:41:31,280 --> 00:41:35,400 Speaker 1: secondly would be what's happening with interest rates? Because biopharmaceutical 678 00:41:35,520 --> 00:41:38,399 Speaker 1: stocks are long dated, you know, you're looking so far 679 00:41:38,440 --> 00:41:41,600 Speaker 1: into the future in terms of how you think about 680 00:41:41,800 --> 00:41:45,120 Speaker 1: earning streams, so you know, making sure that that's part 681 00:41:45,120 --> 00:41:48,480 Speaker 1: of the process in terms of valuations and how much 682 00:41:48,520 --> 00:41:51,120 Speaker 1: you want to pay for those long data assets, that 683 00:41:50,880 --> 00:41:54,120 Speaker 1: it's part of the equation that is very necessary to 684 00:41:54,120 --> 00:41:57,719 Speaker 1: think about when constructing portfolio. Is I have to ask 685 00:41:57,760 --> 00:42:00,680 Speaker 1: you a little bit about some of the craziness we've 686 00:42:00,680 --> 00:42:03,879 Speaker 1: seen in the market. Uh this past month we had 687 00:42:04,120 --> 00:42:08,320 Speaker 1: game Stop going wild, but we've also seen a little 688 00:42:08,320 --> 00:42:13,000 Speaker 1: bit of frothy activity in bitcoin in Tesla. UH. What 689 00:42:13,040 --> 00:42:17,680 Speaker 1: are your thoughts on the question of is this just 690 00:42:17,840 --> 00:42:20,000 Speaker 1: pockets of froth or are we looking at a more 691 00:42:20,040 --> 00:42:23,360 Speaker 1: significant bubble? I guess the observation I would have is 692 00:42:23,360 --> 00:42:28,719 Speaker 1: that we're twelve years into a bowl market um valuations 693 00:42:28,760 --> 00:42:31,520 Speaker 1: are are higher than they have been and that's partly 694 00:42:31,560 --> 00:42:33,480 Speaker 1: due to the low interest rate that we talked about 695 00:42:33,480 --> 00:42:37,080 Speaker 1: the FED policy around the world. So again getting making 696 00:42:37,120 --> 00:42:39,520 Speaker 1: sure we know the future direction of interest rates will 697 00:42:39,520 --> 00:42:43,440 Speaker 1: be very important to valuation. I'm not the expert on 698 00:42:43,520 --> 00:42:47,080 Speaker 1: Tesla or or other areas, but I do observe that 699 00:42:47,640 --> 00:42:51,279 Speaker 1: some parts of my investment in Universe um that the 700 00:42:51,320 --> 00:42:54,920 Speaker 1: relationship between growth and valuation is that extremes and in 701 00:42:54,960 --> 00:42:57,920 Speaker 1: some parts of that not certainly, most parts of it 702 00:42:57,960 --> 00:43:01,840 Speaker 1: are very attractive value ation. So I guess as a 703 00:43:01,920 --> 00:43:05,799 Speaker 1: value investor, that's just a very interesting relationship to me 704 00:43:05,840 --> 00:43:09,439 Speaker 1: that I'm watching very closely. So I think of the 705 00:43:09,480 --> 00:43:12,360 Speaker 1: CEO role as a full time job. I would also 706 00:43:12,440 --> 00:43:17,279 Speaker 1: imagine running a fifty one billion dollar healthcare portfolio as 707 00:43:17,320 --> 00:43:20,480 Speaker 1: a full time job. You're going to continue managing the 708 00:43:20,560 --> 00:43:24,279 Speaker 1: Vanguard health care funds. That seems like a lot to 709 00:43:24,400 --> 00:43:27,239 Speaker 1: do at once. How are you going to juggle the two? 710 00:43:28,880 --> 00:43:31,680 Speaker 1: A couple of things. Want Number one, we are naming 711 00:43:31,760 --> 00:43:34,560 Speaker 1: We have named a president. My my managing partner, colleague, 712 00:43:34,560 --> 00:43:38,160 Speaker 1: Steve Klar, will be president. So he will he will 713 00:43:38,200 --> 00:43:41,280 Speaker 1: be a partner with me in terms of running parts 714 00:43:41,320 --> 00:43:44,319 Speaker 1: of the organization. So that would be number one. UM 715 00:43:44,400 --> 00:43:48,640 Speaker 1: number two, I'm really believe in empowering the empowering the 716 00:43:48,719 --> 00:43:51,040 Speaker 1: leaders and so we have a management team both in 717 00:43:51,120 --> 00:43:53,480 Speaker 1: terms of running the business as well as running running 718 00:43:53,480 --> 00:43:58,440 Speaker 1: our regional offices. Very excited about our leadership team UM. 719 00:43:58,520 --> 00:44:01,160 Speaker 1: And that's a group of twenty people. So that would 720 00:44:01,160 --> 00:44:04,760 Speaker 1: be an observation number two. And then I would say 721 00:44:04,800 --> 00:44:08,920 Speaker 1: in terms of US observation number three specifically for health care. 722 00:44:09,360 --> 00:44:12,560 Speaker 1: You know, we have UM expanded the team over the 723 00:44:12,640 --> 00:44:16,560 Speaker 1: last number of years. The team is has matured and 724 00:44:16,600 --> 00:44:20,320 Speaker 1: they're both their research and risk taking skills. So again 725 00:44:20,400 --> 00:44:23,280 Speaker 1: I'm going to be able to leverage that fifteen person 726 00:44:23,320 --> 00:44:28,040 Speaker 1: plus team very significantly UM as I go forward UM. 727 00:44:28,080 --> 00:44:30,840 Speaker 1: And then and then maybe the last UM, just the 728 00:44:30,920 --> 00:44:33,439 Speaker 1: last thing to share with you, Barry, is that one 729 00:44:33,480 --> 00:44:36,719 Speaker 1: of the things that I think this is very specific, 730 00:44:36,760 --> 00:44:39,359 Speaker 1: but one of maybe my super strength is that I'm 731 00:44:39,480 --> 00:44:44,040 Speaker 1: very organized and again making sure and I've spent a 732 00:44:44,080 --> 00:44:46,640 Speaker 1: lot of time thinking through how I'm going to spend 733 00:44:46,640 --> 00:44:49,520 Speaker 1: my time going forward and and and again, then it's 734 00:44:49,600 --> 00:44:51,880 Speaker 1: up to me to execute that plan to make sure 735 00:44:51,960 --> 00:44:57,640 Speaker 1: that I'm both ending UM significant time on UM managing 736 00:44:57,640 --> 00:45:00,399 Speaker 1: healthcare assets for the Van Guard Care hole or as 737 00:45:00,400 --> 00:45:03,080 Speaker 1: well as the firm and all the clients with the firm. 738 00:45:03,280 --> 00:45:05,760 Speaker 1: So I feel very comfortable in the plan going forward 739 00:45:05,840 --> 00:45:08,200 Speaker 1: and how I'm going to be spending my time UM, 740 00:45:08,200 --> 00:45:10,759 Speaker 1: and then just hopefully there are benefits. The benefits of 741 00:45:10,760 --> 00:45:12,720 Speaker 1: it will be that I'm going to be staying very 742 00:45:12,760 --> 00:45:16,160 Speaker 1: close to our investors. I'm going to be you know, 743 00:45:16,480 --> 00:45:19,520 Speaker 1: we're gonna be UM in the morning meeting together, We're 744 00:45:19,520 --> 00:45:22,360 Speaker 1: gonna be in company meetings together, and so staying close 745 00:45:22,400 --> 00:45:26,560 Speaker 1: to investors hopefully will help me think about how we're 746 00:45:26,560 --> 00:45:28,480 Speaker 1: going to evolve as investors. How are we going to 747 00:45:28,600 --> 00:45:30,640 Speaker 1: use more science, how are we going to use more 748 00:45:30,640 --> 00:45:35,200 Speaker 1: technology to help us evolve. So again there're synergies to 749 00:45:36,000 --> 00:45:39,120 Speaker 1: both the roles UM, and I think as we hopefully 750 00:45:39,160 --> 00:45:42,400 Speaker 1: at the end of my term at Wellingtons CEO, that 751 00:45:42,480 --> 00:45:44,400 Speaker 1: will that will look back and say that was a 752 00:45:44,440 --> 00:45:47,080 Speaker 1: benefit that you know that that was the benefit both 753 00:45:47,120 --> 00:45:50,600 Speaker 1: to the firm as well as to UM as well 754 00:45:50,640 --> 00:45:53,239 Speaker 1: as to Vanguard shareholders. So let me throw a curve 755 00:45:53,320 --> 00:45:57,880 Speaker 1: bawl at you. Gene becomes CEO, and then Gene notices 756 00:45:58,680 --> 00:46:03,360 Speaker 1: UM the manager of the Vanguard Healthcare Funds is falling 757 00:46:03,360 --> 00:46:07,560 Speaker 1: behind prior performance. How are you going to fire that manager? What? 758 00:46:07,560 --> 00:46:11,280 Speaker 1: What are you gonna do? Swapping hats that way. So government, 759 00:46:11,840 --> 00:46:15,160 Speaker 1: we talked about governance and our our producer responsibility at 760 00:46:15,160 --> 00:46:19,680 Speaker 1: Wellington is another area that we take very seriously and 761 00:46:19,719 --> 00:46:21,680 Speaker 1: so we have a plan in place. So first of all, 762 00:46:21,920 --> 00:46:25,920 Speaker 1: it will be Vanguard's responsibility to to decide, you know, 763 00:46:26,560 --> 00:46:29,080 Speaker 1: how well of a job I'm doing, So Vanguard will 764 00:46:29,120 --> 00:46:32,960 Speaker 1: be the ultimate decision maker there. And then from myself 765 00:46:33,040 --> 00:46:35,600 Speaker 1: we have again you're it's very important that we have 766 00:46:36,239 --> 00:46:38,400 Speaker 1: do you share the oversight of me as an investor 767 00:46:38,440 --> 00:46:40,080 Speaker 1: as well? And so we have a plan in place, 768 00:46:40,719 --> 00:46:44,200 Speaker 1: UM to make sure that happens makes sense. I assume 769 00:46:44,280 --> 00:46:47,560 Speaker 1: that there was some mechanism that you guys weren't just 770 00:46:47,600 --> 00:46:51,279 Speaker 1: spit ball and not not with that much money. UM. 771 00:46:51,320 --> 00:46:54,080 Speaker 1: So let's jump to our favorite questions that we ask 772 00:46:54,320 --> 00:46:57,680 Speaker 1: all of our guests, UM, starting with what are you 773 00:46:57,719 --> 00:47:00,920 Speaker 1: streaming these days? Tell us what's keep can you entertained 774 00:47:01,280 --> 00:47:05,279 Speaker 1: either Netflix or or podcast? Or what are you doing 775 00:47:05,320 --> 00:47:08,600 Speaker 1: for entertainment at all? So one of them, you know 776 00:47:08,680 --> 00:47:11,239 Speaker 1: one of the things I you may or may not 777 00:47:11,360 --> 00:47:14,000 Speaker 1: know that I have four daughters and so they're they're 778 00:47:14,040 --> 00:47:17,480 Speaker 1: in their um early twenties and late teens, and and 779 00:47:17,560 --> 00:47:21,359 Speaker 1: so I've been pretty busy over the last twenty two 780 00:47:21,400 --> 00:47:24,560 Speaker 1: plus years. And so one of the things, one of 781 00:47:24,560 --> 00:47:27,920 Speaker 1: the things I'm streaming now is these Theories that I 782 00:47:28,000 --> 00:47:30,160 Speaker 1: never got to watch as I was working full time 783 00:47:30,160 --> 00:47:34,280 Speaker 1: and raising a family, and so UM I watched West 784 00:47:34,280 --> 00:47:36,680 Speaker 1: Wing was a big west Wing year for me. I 785 00:47:36,800 --> 00:47:39,279 Speaker 1: never watched the Theories, so that would be one. And 786 00:47:39,320 --> 00:47:42,839 Speaker 1: then UM, this British series Bridgerton, that was a big 787 00:47:42,880 --> 00:47:46,040 Speaker 1: series with my daughters over the holidays. We you know, 788 00:47:46,080 --> 00:47:50,080 Speaker 1: we binge watched that, um when they were all home. Yeah, 789 00:47:50,080 --> 00:47:52,680 Speaker 1: that's that's funny. It's always interesting to see what people 790 00:47:52,760 --> 00:47:56,120 Speaker 1: go back to. We never saw Madmen, and we ended 791 00:47:56,200 --> 00:48:00,799 Speaker 1: up just watching that very interesting period piece, just like 792 00:48:00,920 --> 00:48:03,960 Speaker 1: just like West Wing. Tell us about your early mentors 793 00:48:04,000 --> 00:48:07,239 Speaker 1: who helped to shape your career, Well, we already talked 794 00:48:07,239 --> 00:48:09,960 Speaker 1: about Ed. I would say, you know, Ed was just 795 00:48:10,160 --> 00:48:13,520 Speaker 1: so vital um someone that I worked alongside with for 796 00:48:13,600 --> 00:48:16,880 Speaker 1: twenty years and I and I again back to Ed 797 00:48:17,000 --> 00:48:20,640 Speaker 1: being just giving me the space to grow, um, the 798 00:48:20,680 --> 00:48:25,360 Speaker 1: space to learn mistakes. So he was very critical. There's 799 00:48:25,360 --> 00:48:27,959 Speaker 1: another person, Phil pearlmother, who was one of the managing party, 800 00:48:28,040 --> 00:48:30,600 Speaker 1: was a managing partner. He since retired. He's recently retired 801 00:48:30,640 --> 00:48:33,560 Speaker 1: from Wellington's, but I would consider him a sponsor. He 802 00:48:33,600 --> 00:48:35,880 Speaker 1: was always looking out for me. He was a midcast 803 00:48:35,960 --> 00:48:38,560 Speaker 1: growth portfolio manager, so I guess I was helping him. 804 00:48:38,600 --> 00:48:42,239 Speaker 1: But he was always making sure that my career was 805 00:48:42,280 --> 00:48:46,000 Speaker 1: moving along. Let's talk about what you're reading these days. 806 00:48:46,080 --> 00:48:48,960 Speaker 1: Tell us about some of your favorite books and what 807 00:48:49,000 --> 00:48:53,560 Speaker 1: you're reading now. So I really like historical fiction, um, 808 00:48:53,880 --> 00:48:56,760 Speaker 1: where you learn about a place or time through fiction. 809 00:48:57,320 --> 00:49:01,640 Speaker 1: So I think my favorite book this year was Educated Needed. UM. 810 00:49:01,680 --> 00:49:04,759 Speaker 1: I am on my bedstand right now. I have UM 811 00:49:04,920 --> 00:49:07,719 Speaker 1: Barack Obama's book. So that's my next some my my 812 00:49:07,840 --> 00:49:11,000 Speaker 1: next book to read UM in the coming run. Sounds good. 813 00:49:11,360 --> 00:49:13,920 Speaker 1: What sort of advice would you give to a recent 814 00:49:14,000 --> 00:49:18,280 Speaker 1: college graduate who was interested in a career in either 815 00:49:18,920 --> 00:49:24,480 Speaker 1: stock research or asset management or working in finance. I 816 00:49:24,480 --> 00:49:28,320 Speaker 1: would give two pieces of advice. One would be always 817 00:49:28,640 --> 00:49:31,400 Speaker 1: all just always be learning. So when I when I 818 00:49:31,440 --> 00:49:34,960 Speaker 1: observed talent at Wellington, I get very excited about the 819 00:49:35,000 --> 00:49:38,520 Speaker 1: talent Wellington's, the ones with this growth mindset that are 820 00:49:38,560 --> 00:49:43,919 Speaker 1: always learning, always UM, challenging the status quo of how 821 00:49:43,960 --> 00:49:48,200 Speaker 1: we do things UM. The you know, it's just very 822 00:49:48,200 --> 00:49:51,320 Speaker 1: exciting to see. So again, always have that curiosity growth 823 00:49:51,360 --> 00:49:55,360 Speaker 1: mindset UM, always thinking about what what more could you 824 00:49:55,400 --> 00:49:58,160 Speaker 1: be doing in your in your in your role. So 825 00:49:58,239 --> 00:50:00,640 Speaker 1: that would be an important piece of advice. Then secondly, 826 00:50:01,280 --> 00:50:04,560 Speaker 1: just at the asset management industry and you know, research 827 00:50:04,920 --> 00:50:08,839 Speaker 1: UM in terms of researching stocks and it's just such 828 00:50:08,880 --> 00:50:12,600 Speaker 1: a great business UM. So I would encourage I would 829 00:50:12,680 --> 00:50:16,400 Speaker 1: encourage people graduating from college to think about the asset 830 00:50:16,400 --> 00:50:21,480 Speaker 1: management industry. And and and again there's a significant broader 831 00:50:21,520 --> 00:50:26,120 Speaker 1: purpose here in terms of serving individuals and beneficiaries all 832 00:50:26,160 --> 00:50:30,600 Speaker 1: over the world to help them UM lead better, better 833 00:50:30,719 --> 00:50:33,400 Speaker 1: lives long term. And so how do we attract talent 834 00:50:33,480 --> 00:50:36,719 Speaker 1: to that mission? UM? Of how and again it's how 835 00:50:36,760 --> 00:50:40,439 Speaker 1: are we you know, we're allocating capital to companies UM 836 00:50:40,560 --> 00:50:44,160 Speaker 1: that are going to make UM the vaccines that save 837 00:50:44,360 --> 00:50:46,160 Speaker 1: you know, that really get us back, that save the 838 00:50:46,160 --> 00:50:48,440 Speaker 1: world and protect the world. I think that is the 839 00:50:48,560 --> 00:50:52,399 Speaker 1: kind of mission that that I'd like to make sure 840 00:50:52,480 --> 00:50:55,319 Speaker 1: that everyone knows. And and just how you know, how 841 00:50:55,360 --> 00:50:59,880 Speaker 1: exciting it is to be UM to meet companies and 842 00:51:00,040 --> 00:51:02,439 Speaker 1: to meet heads of R and D, and to meet 843 00:51:02,560 --> 00:51:06,480 Speaker 1: CEOs and and and see how they're changing the changing 844 00:51:06,480 --> 00:51:10,200 Speaker 1: the future of the world. That is just intellectually, I've 845 00:51:10,239 --> 00:51:14,040 Speaker 1: never I've never when I wake up every UM, I 846 00:51:14,120 --> 00:51:16,200 Speaker 1: never had this Sunday night that I don't want to 847 00:51:16,200 --> 00:51:17,719 Speaker 1: go to work the next day. It's just such a 848 00:51:17,760 --> 00:51:21,680 Speaker 1: great business to be in. Quite interesting and our final question, 849 00:51:22,280 --> 00:51:24,920 Speaker 1: what do you know about the world of investing today 850 00:51:25,000 --> 00:51:27,759 Speaker 1: that you wish you knew thirty years ago when you 851 00:51:27,800 --> 00:51:31,000 Speaker 1: were first getting started. UM. I think when I when 852 00:51:31,040 --> 00:51:32,880 Speaker 1: I think about the when I think about the world 853 00:51:32,880 --> 00:51:36,880 Speaker 1: of investing, I think about it in three phases. And 854 00:51:36,920 --> 00:51:41,360 Speaker 1: we talked about being a deep researcher, being an investor, 855 00:51:41,440 --> 00:51:44,759 Speaker 1: and I and I take being an investor meaning to 856 00:51:44,960 --> 00:51:47,360 Speaker 1: can you do recommended can you take all your research 857 00:51:47,400 --> 00:51:51,359 Speaker 1: insights and make recommendations, and then finally being a risk 858 00:51:51,360 --> 00:51:55,920 Speaker 1: taker and taking taking risk in portfolios. UM. I guess 859 00:51:56,719 --> 00:51:59,560 Speaker 1: if I had to UM, if I had to know 860 00:51:59,680 --> 00:52:03,520 Speaker 1: back thirty years, it probably would have been really perfecting 861 00:52:03,560 --> 00:52:06,879 Speaker 1: each stage and getting maybe more training. I think that's 862 00:52:06,920 --> 00:52:09,280 Speaker 1: one of the things we're going to we're really focused 863 00:52:09,320 --> 00:52:12,520 Speaker 1: on at Wellington is making sure we're training during those 864 00:52:12,520 --> 00:52:16,440 Speaker 1: pivot points. So that would be one thing. You know, 865 00:52:16,840 --> 00:52:19,040 Speaker 1: these are these are skills you can be you can 866 00:52:19,160 --> 00:52:22,360 Speaker 1: learn and skills that you can get better at with development. 867 00:52:22,400 --> 00:52:24,919 Speaker 1: And so that's a very important initiative on my part 868 00:52:24,920 --> 00:52:27,160 Speaker 1: in terms of how do we develop investors along that 869 00:52:27,280 --> 00:52:31,120 Speaker 1: path um. And then I think, you know, personally, just 870 00:52:31,400 --> 00:52:35,319 Speaker 1: being very flexible UM pivoting when you have new information. 871 00:52:35,840 --> 00:52:37,719 Speaker 1: That's what I think really hard. It's hard to do 872 00:52:38,360 --> 00:52:40,960 Speaker 1: after you, after you maybe you might have invested two 873 00:52:41,040 --> 00:52:44,800 Speaker 1: or three years and into a stock and then something changes. 874 00:52:44,840 --> 00:52:47,480 Speaker 1: That ability to be flexible at pivot I think is 875 00:52:47,520 --> 00:52:51,520 Speaker 1: critical to investment success. And you know, the earlier you 876 00:52:51,560 --> 00:52:54,480 Speaker 1: can learn that, the better. Terrific stuff. Thanks Jane for 877 00:52:54,520 --> 00:52:58,320 Speaker 1: being so generous with your time. We have been speaking 878 00:52:58,360 --> 00:53:01,640 Speaker 1: with Gene Hines. She manages the fifty billion dollars Van 879 00:53:01,719 --> 00:53:08,080 Speaker 1: Guard Healthcare Fund and is the incoming CEO at Wellington Management, 880 00:53:08,160 --> 00:53:12,680 Speaker 1: which runs over a trillion dollars in client assets. If 881 00:53:12,760 --> 00:53:15,520 Speaker 1: you enjoy this conversation, well be sure and check out 882 00:53:15,600 --> 00:53:19,040 Speaker 1: any of the previous three hundred and eighty seven prior 883 00:53:19,080 --> 00:53:21,760 Speaker 1: to such conversations we've had over the past seven years. 884 00:53:22,320 --> 00:53:26,480 Speaker 1: You can find them at iTunes, Spotify, wherever you feed 885 00:53:26,560 --> 00:53:31,040 Speaker 1: your podcast fix. We love your comments, feedback in suggestions 886 00:53:31,200 --> 00:53:34,919 Speaker 1: right to us at m IB podcast at Bloomberg dot net. 887 00:53:35,280 --> 00:53:38,120 Speaker 1: Give us a review on Apple iTunes. You can sign 888 00:53:38,239 --> 00:53:41,279 Speaker 1: up for my Daily Reads at rid Halts dot com. 889 00:53:41,360 --> 00:53:45,600 Speaker 1: Check out my weekly column on Bloomberg dot com slash Opinion. 890 00:53:46,160 --> 00:53:49,680 Speaker 1: Follow me on Twitter at rit Halts. I would be 891 00:53:49,719 --> 00:53:52,000 Speaker 1: remiss if I did not thank the crack staff that 892 00:53:52,040 --> 00:53:55,520 Speaker 1: helps us put together these conversations each and every week. 893 00:53:55,880 --> 00:54:00,560 Speaker 1: Reggie Bazil is our audio engineer. Michael Boyle is my 894 00:54:00,760 --> 00:54:05,080 Speaker 1: producer slash booker. A tink of Valbronn is our project manager. 895 00:54:05,560 --> 00:54:09,560 Speaker 1: Michael Batnick is our head of research. I'm Barry Ritolts. 896 00:54:09,760 --> 00:54:13,440 Speaker 1: You've been listening to Mascuw's in Business on Bloomberg Radio