WSO Podcast | E119: Fund Manager Says No to Goldman Right Out of School
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In this episode, Yuri shares his winding path starting out graduating from his master's program in London right at the start of the global financial crisis and turning down an offer to start at Goldman Sachs to travel the world and try to get into a more direct investing role. Listen to his great advice on specific questions to ask when interviewing for asset management or hedge fund roles as a junior analyst and also make sure to check out his blog snippet. Finance, a place where he shares interesting snippets of financial data and analysis.
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WSO Podcast (Episode 119) Transcript:
Patrick (CEO of WSO): [00:00:06] Hello and welcome. I'm Patrick Curtis, your host and chief monkey, and this is the Wall Street Oasis podcast. Join me as I talk to some of the community's most successful and inspirational members to gain valuable insight into different career paths and life in general. Let's get to it. In this episode, Yuri shares his winding path, starting out graduating from his master's program in London right at the start of the global financial crisis and turning down an offer to start at Goldman Sachs to travel the world and try to get into a more direct investing role. Listen to his great advice on specific questions to ask when interviewing for asset management or hedge fund roles as a junior analyst. And also make sure to check out his blog Snippets of Finance, a place where he shares interesting snippets of financial data and analysis. Enjoy. All right, Uri, thanks so much for joining the Wall Street Voices podcast. Thanks very much. So it would be great if you could just give the listeners a short summary of your bio. Yeah, absolutely. So probably take you all the way back. I'm originally from Armenia. I was born there, and after the collapse of the Soviet Union, I moved back to what we moved to Denmark. That's where I grew up, so I've got quite an international background. And I went to international schools here in Denmark and decided that the best place to go was the UK and I started studying there. I did my undergraduate at Cambridge for three years studying economics, and then I did this masters at LSC for one year, studying sort of completing my studies in economics. And this was around 2008 timeframe is when I finished my masters. Exactly. Good timing. And I remember I was working at Goldman Sachs doing an internship in their sort of private equity asset management wing, and I wasn't sort of enjoying it too much. It was a bit of a tough time. And then when they offered me the job, I'd actually decided not to take it. And I remember saying, you know, quit, basically speaking to the managing director on the phone and saying, you know, I'm not interested in taking the job. And that was on a Friday. And he sort of tried to convince me and I said a final no. And then on Monday, Lehman Brothers collapsed and the whole world blew up. And basically, I was kind of kicking myself thinking, you know, I've obviously passed up on this great opportunity at a great firm. What have I done? Et cetera, et cetera. But actually, it kind of all worked out in a funny sort of way in the world sort of has a tendency to do that. So I took a bit of time out. I went traveling. And then as 2009 rolled around, I basically started applying for jobs. And at the time, I knew my passion was in investing and in asset management, and I just want to get into that. So I sent out hundreds of applications, as everybody else does, to all the asset management firms in London. I remember opening the back of the FFT and just going through all of the companies sending it out, but we see plenty of places weren't hiring. And that was kind of one of the lucky things. And I think given the current environment and what people are going through, sometimes these kind of crises throw up opportunities of the good firms are out there looking for people to hire, and if they're hiring, then you almost have a positive selection effect, which I would say is really positive for me. So I ended up at a firm named Geddie Asset Management, which was kind of an up and coming scrappy boutique in the UK Asset Management space. They were started in 2002. For a bunch of guys left. Merrill Lynch decided to start on their own, built a business from nothing to a reasonably big business. By the time I joined and I was the first kind of graduate hire on their graduate program, there have been many ever since and I basically worked my way up. So I started as an analyst on the internal hedge fund they had. I did my CFA. I learnt all the ropes of investing and under really, really, really sophisticated good investors with a great track record, mostly equity. Like what type of debt? Yeah. So it was a long, short fund that was 100 percent equities. I primarily kind of focused on UK equities because that was the pedigree of the sort of fund management house, but we did a lot of other international stocks as well. It was just a great time because we were I was in a good place. The people make a huge difference and the people I worked with are really loved and I learned a lot from them and they respected me as well. Despite being kind of an analyst and just kind of fresh off the sort of intellectual boat that sailed into the city. And I didn't. I just loved their respect for kind of intellectual honesty and just people having a view about stuff that they might not know anything about. And so I just worked on equities, the whole CFA thing, which was obviously a long process as many people have gone through before. Again, lots of support from the firm for that. And eventually I worked my way kind of up and there was an opportunity that opened up for a fund within the company that was kind of starting up, which was a focus like a UK income fund focused kind of fund. And I, yeah, I just took it. And together with my boss, we basically built that fund from nothing to a one and a half billion pound fund.
We sort of beat all of our competition over that period and performed really, really well. And so it was it was also another really great kind of learning curve where you go from analysing companies to actually building portfolios and making investment decisions, which is a completely different game. And also obviously a lot of fun talking to clients, meeting clients and trying to convince them to invest with us, which is a whole sort of other area. Yeah, exactly all the experiences that you build on that. And so we ran the fund together. And then last year we fought for lots of various reasons, which I don't care to kind of say all in the public venue. I decided to actually leave McGeady after. Ten years, so I guess it's slightly different to a lot of people in the sense that I stuck to one firm for a very long period of time. But this is a firm that gave me my education and gave me all this valuable experience, and I really, really loved and valued the people that work there. And I would say, I want to say it's rare, but it probably is quite rare among people out there in general having this kind of experience. Oh yeah.
Patrick (CEO of WSO): [00:06:25] Ten years is a good run. Ten years is a really good run.
Yuri: [00:06:28] Absolutely. I think so. And I didn't want to leave in a bad way. So what I decided to do is I'm going to take a year out and I was going to slightly pivot my career into a sector that I really liked, which was biosciences. So I left Mujahideen, hung up my investing shoes on the 30th of June 2019 and basically spent the last year doing a master's in bioscience enterprise. It's called so it's a think of it sort of as a mini MPA for people who like biotech Cambridge is trying to create. They've got a huge ecosystem of biosciences and really, really interesting firms and venture capital funds and things like that. And I just thought that could be really fun to do for a year and then I'll decide what I'll do after that year. And that's kind of where you find me slightly just having finished my dissertation. So being a student, that kind of after 10 years of working, it's just fun. It's good. Highly recommended. I mean, many of you out there will probably be considering MBAs or whatever, and I think it's a great idea to do that. Take a break. Think about what you want to do with your career. Probably not quite as late as I did it, but it's still a great time. There's a lot of really exciting ideas going on in the world right now, and universities are hotbeds of these ideas. I feel like young people are a hotbed of these ideas, and it was just about kind of exposing myself to all of those things. So that's why I decided to do that. And then, you know, my heart is still in investing, so I'll probably end up doing it in some sort of capacity, more entrepreneurial. I think more like doing my own thing or with my sort of former colleagues or whatever it might be enjoying your
Patrick (CEO of WSO): [00:08:09] Time at school, you started. Snip it. Why don't you talk about snip it a little bit?
Yuri: [00:08:13] Absolutely. So yeah, thanks for picking up on that. It's so one of the things I wanted to do was not to lose touch with the financial markets, and that was kind of a personal reason. But what I really found that I enjoyed the most when I was working at G.D. was kind of finding these little nuggets of information. I call them sort of snippets where it's something that's really interesting and very different, and investing is all about thinking in a different way to everybody else in the stock market. And I was finding a lot of these nuggets of information lots and lots of various sources, mostly online. And I decided, Well, I don't have an outlet selling this to sort of all the people at my firm. So I'll start a blog and I started a blog which is called Snippet Finance through just snippet of finance. And the idea is, let me just put together a little snippets there. Sort of, you know, if you sign up for the email, there's about three. You get three emails a week, three snippets very easy to read, and there's links usually to if you want to dig deeper into the topic. And the idea was just to impress people. Press your boss impressive interviews and press whoever with a little nugget of information that makes you look a bit different to say, just reading the left or The Wall Street Journal. And it's been a really exciting experience as well, like kind of building all of this from scratch, which, you know, it's just something else to do. And just I really, really love that part as well, and I just love finding this information and giving it to people. And I hope people, people pick up on it and kind of see the passion about finding these little nuggets.
Patrick (CEO of WSO): [00:09:42] Yeah, let's go back. Let's rewind. Let's go all the way back to your undergrad, and we'll get into that a little bit more. But were you always, you know, you said you're an economics major, you're studying? That's right. Yeah. Were you always interested in finance? Did you know you wanted to be an investor or when did that first? Kind of.
Yuri: [00:09:58] Yeah, it's a really good question
Patrick (CEO of WSO): [00:10:02] In it at all. Like, you
Yuri: [00:10:03] Know, my both my parents are scientists. My father is a physicist, my mother is a biologist. So not my family. Finance was very far removed from Soviet Union or Armenia or anything like that. I would say it was a bit of a journey, which is probably the right way to approach any of these things. So I, you know, I study economics. I kind of heard a little bit of finance in my first year, to be honest with you, I really didn't know what it was. I didn't know what investment banking was, but what I knew was I wanted to try it out. So I did an internship at UBS in Equity Capital Markets in ECM. I thought it was very enjoyable. But what I really got excited about was what the people kind of on the other side who were selling the securities too were doing and why they were making the decisions and things like that. I didn't. It was an enjoyable time at ECM, but it wasn't quite for me and I kind of way I think it wasn't just as intellectually interesting as kind of doing it straight up,
Patrick (CEO of WSO): [00:10:59] And it was more. Transactional.
Yuri: [00:11:00] Exactly, it was more transactional. There was a lot of sort of salesman and, you know, all these really valuable skills, of course, but the mind, my heart and my mind kind of lay with intellectual endeavor and kind of understanding how the world works. So it piqued my interest already at that point. But I actually
Patrick (CEO of WSO): [00:11:18] Equity capital markets isn't intellectual. I agree with you. And I mean, there's obviously a lot more sales. There's a lot more pitching. There's a lot more, a lot more art will say on the valuation side than
Yuri: [00:11:29] When
Patrick (CEO of WSO): [00:11:30] You're an investor. You really you care about the truth and the intellectual honesty really is.
Yuri: [00:11:34] Exactly. I think that's exactly right. I think that's exactly right. And I mean, people have sort of it's I'm not saying I'm not covering any new ground or any new revelation. I think that's the way it is. And it was 2006 as well. So it was sort of go years. People were. There was a lot of transactions going on and it just didn't feel like an environment that I would thrive in. And I think that's really important for people who are looking for internships and jobs is to sort of find places there. They're going to thrive with the right people and the right sort of environment. So I then had this interest, but then my pendulum swung completely to the other end of the sort of intellectual skills that I did economic consulting, which is another interesting field for economists to have a more commercial kind of impact on companies. This is all about antitrust and economic policy and trying to understand essentially are mergers allowed to happen from the perspective of the consumer and how we can defend that in court? So I did that one summer again. It was a bit too far down the intellectual rabbit hole.
Yuri: [00:12:38] And at the time, I was already very interested in reading about finance, which is kind of one of the reasons why I love snippet and I love reading about all of these things. It started at a very early time for me, and I was just constantly reading about things, reading about, you know, lots of different blogs like EFT, Alphaville, et cetera, and just learning about finance. It was getting really interesting. And then that was at the point where I started investing myself a little bit. So I started looking at companies. I started looking at broader ETFs and countries and things like that and thinking about how you take risks and how you sort of build a portfolio. And so I had caught that bug, but I was I had a one more internship slot, and that's what happens when you have a masters. So you know, I could do one right after the end of the Masters and I decided to go for Goldman Sachs Asset Management. They put me in the private equity group, which is a, you know, you'll never hear me say anything bad. It's a great organization and it's a great thing.
Patrick (CEO of WSO): [00:13:35] So what are they? What's the private equity group, an asset? So it's equity clients, basically.
Yuri: [00:13:41] Yeah. So it's actually it's a fund of funds of private equity funds. That's their main business and they invest in private equity funds. They do a lot of co-invest deals as well, alongside the private equity funds and a little bit of direct investing, but mostly that was their kind of main bid and they were raising big secondary private equity funds to buy LP interests of essentially struggling you. Anyone was struggling in the financial crisis and it was an exciting place to be. And obviously, Goldman Sachs is a fantastic company and a personal brand. But it was very sort of cutthroat. It was hard, you know, sort of. I didn't have a good interpersonal relationship
Patrick (CEO of WSO): [00:14:24] With this was in London, correct?
Yuri: [00:14:26] This was in London, and this was one of the other problems with it, which is that the team is essentially 90 people in New York and 10 people in London. So the power base is very much in London or New York. And sorry, New York. Yeah. And which I mean, to be completely honest with you, means that you will have no life because you always have to be on for whatever, whether you're in New York hours or London hours.
Patrick (CEO of WSO): [00:14:48] And it's what were your hours that summer?
Yuri: [00:14:51] Really, really bad. Like over a hundred only work. I told a few sort of three, three, four a.m. nights. Yeah, it was a lot of work, to be completely honest with you. I wasn't 100 percent sure why it had to be done exactly at those times, but I think it was a bit of a rite of passage at the time, wasn't it? It was a lot of work. The managing directors and partners were fantastic. They were really positive and just had a great relationship with
Patrick (CEO of WSO): [00:15:20] The analysts and the associates are under a lot of stress to push and stress. And so they're forcing their forcing work on you at all hours of the night and like, where are you? Where are you?
Yuri: [00:15:31] Exactly. And I think it's sort of a divide, but that's just the way it sort of is in that country,
Patrick (CEO of WSO): [00:15:37] Similar to banking. I'm surprised asset management was like, I guess you guys just maybe it was the intern program. Bit of it, like a little bit of a rite of passage to see if you could cut it.
Yuri: [00:15:46] Yeah, I think a bit of a rite of passage that was private equity. So it's transactional. So there were deadlines to get things done, but I'm not sure. I guess in the end it was.
Patrick (CEO of WSO): [00:15:59] New York and then the time zone differences make crushing you exactly supporting some teams in New York sometimes.
Yuri: [00:16:07] Yeah, yeah. So I spent a lot of time working with the people in New York. And yeah, basically if you ever in London and you're working with people in New York, it's just hell essentially for people in London, for the time wise. Sure. And so, you know, I already told you the story of the way I kind of decided on that, but at that time I was just 100 percent into investing. I thought that Goldman Sachs asset manager would give me a real experience in the investing side, and it did, but it was a lot of secondary type of investing where you're investing into someone else's fund.
Patrick (CEO of WSO): [00:16:35] Yeah, so you're doing more fund analysis and you're looking at the managers really rather in the track analyzing that rather than analyzing the company specifically, which is really.
Yuri: [00:16:43] Exactly, exactly.
Patrick (CEO of WSO): [00:16:45] And were you able to communicate that to like when they were trying to convince you to stay and join?
Yuri: [00:16:51] Yeah, I communicated all of these things that essentially I wanted to be at the coalface of investing. I wanted to actually make decisions of which securities went into the portfolio. That's what I enjoyed. I guess the thing I would say is that I didn't want my destiny determined by somebody else, because if you're if you're running a fund or you're making equity investment decisions, you're in charge of your own destiny. You think Microsoft will buy it goes up fantastic. You've done really well. It goes down. You did really badly. Whereas if you then say, OK, I think, you know, Patrick is an amazing investor. I'm going to give him money and then he blows it up. Then you're, you know, it's not your fault, really, no matter how good you are at picking investors. And actually, that influenced my job. Decisions as one of the job offers I had later on was for a sort of consultant for picking funds, and I just decided that that wasn't really for me in the end as well.
Patrick (CEO of WSO): [00:17:43] So it was kind of I think it was helpful. It sounds like all your internships were helpful and kind of helping just solidify your desire to be actually in an investing seat. So tell me how you came out of that. You went on a trip where you go after saying no and the world exploded and explodes.
Yuri: [00:18:00] I spent a bit of time living in Germany just because I kind of wanted to learn a bit of German, and then I went traveling to South Asia. I'll tell you another funny story, if you like. Yeah. So I started applying early 2009. Obviously, it was. The world was complete chaos, and I was a young analyst trying to apply for jobs in finance.
Patrick (CEO of WSO): [00:18:19] But it hadn't really even worked full time. You had just an internship,
Yuri: [00:18:22] Just internships, and the internships are
Patrick (CEO of WSO): [00:18:24] Really sorry to interrupt. But how rare is it to come out of your masters? Have an offer from Goldman Sachs and turn it down?
Yuri: [00:18:33] I think most of the people whose advice I took
Patrick (CEO of WSO): [00:18:37] Doesn't happen, right?
Yuri: [00:18:38] Yeah, it just doesn't happen. I think I made the right decision because the person who took my job wasn't very happy after, you know, with that kind of environment. And it just doesn't happen. I know I'm probably one of the. In fact, I used to bring this up.
Patrick (CEO of WSO): [00:18:55] Yeah, I'm not saying it was the wrong decision. I'm just saying the fact that you had the had the confidence to turn that down is really saying something at that young age. What were you like? Twenty to twenty two?
Yuri: [00:19:09] Right? Yeah, very young. Probably a bit dumb, but I would say
Patrick (CEO of WSO): [00:19:14] Naive a little bit. I am going to be naive.
Yuri: [00:19:18] I think the message I would sort of say is that it's possible, you know, there's a lot of different firms out there. I didn't obviously foresee that the financial crisis is going to get so bad at that point, right? But I think it's important to know what you like as well as what the sort of big firms they want. Everyone's obviously wants that coveted place, but if it's not for you, it probably isn't for you and you're not going to get the best out of it.
Patrick (CEO of WSO): [00:19:42] Yeah. So you lived in Germany for a little bit,
Yuri: [00:19:44] In Germany for a little bit. And so then I came back to Denmark. I was trying to apply for all of these jobs. As I said back of the FFT going through each one of those
Patrick (CEO of WSO): [00:19:51] Born in London. At that point,
Yuri: [00:19:52] I was flying kind of between London and Copenhagen for interviews. I knew I wanted to live in London. The financials kind of capital. And then I sort of did a few second, you know, first round, second round. So I was interviewing with the kind of three or four firms and I managed to make it to the second round, but I had a ticket to go traveling to Southeast Asia. You know, you're sort of Vietnam, Thailand, et cetera. And I had a ticket and I was like, Well, you know, I'm going. So I basically left in the middle of the sort of interview process. And then I was traveling around in Vietnam, and I get the calls from both companies that were kind of very interested at that time. And they say, you know, we want you to come in for a final round and I'm like, Well, this is my problem. I'm in Vietnam, I'm a bit far away. And they said, OK, well, and then after a bit of discussion, they said, OK, fine, we'll pay. So what I did was, I'm sort of embarrassed to say this publicly, but I basically got one company to pay half of the ticket and the other companies pay the other half of the ticket. Each thought that I had paid myself to come back. And you know, at the time, that was quite a lot of money basically for you, right? So. I show up, I remember this very clearly, I leave by train, I go to Hanoi. I jump on a plane. I fly through Bangkok. I land in London. I go to my friend's place. I don't. I didn't have a lot of things there. Everything was in Copenhagen. I borrow his oversized suit. I show up at the interview and I think just the process of showing up was probably the reason why I got both jobs. They just said, Look, he's travelled all the way here. Obviously, I had to impress them as well in the final round. And then I remember flying back the same hedge funds. Basically, these were so. There was two funds, one within a consultant firm as well. Oh, I had actually three interviews when I came back.
Patrick (CEO of WSO): And what was consulting, OK?
Yuri: [00:21:41] One was for consulting.
Patrick (CEO of WSO): [00:21:43] So what type? What were the interviews like? Like, pinch me. All right. Yeah. Well, what are they? They force you to talk about your track record and your personal portfolio.
Yuri: [00:21:53] Well, I right. So I think maybe this also brings a life kind of some of the tips I've got because what I've also been fortunate enough while I, Majed is interviewing people as well. So I have quite a lot of experience of both sides of the table. So the questions are so the main thing that I think won people over is that I was reading a lot about finance. And when I say a lot, I was religiously reading everything I could possibly, and I was just hoovering up information. And I think that came across that I had a real passion for reading and investing. In the end of the day, I was Warren, Buffett says. It's just about sitting at home, you know, into your office and reading as much as you can, possibly. And I think they look for that. I was intellectually curious. I knew how to kind of connect dots of information, say, well, this is interesting here. This is interesting here. Could this be more interesting if we think about it together? The questions were, I mean, you know, too much credit there. Questions were really fun and it was just a fun interview. They ask really tough questions. So they would sort of ask these kind of I mean, I'm not allowed to divulge what they were, but things that you wouldn't necessarily expect in an interview. But they were sort of not brainteasers necessarily. But they would ask you what you why do you think a certain thing was the case that? And it's not something you would have ever been able to read up on. And then you just had to kind of argue for yourself on the spot why you thought that was the case.
Patrick (CEO of WSO): [00:23:21] It's more just your logic, your structure and logic.
Yuri: [00:23:23] Exactly. So the way you thought about something, your arguments, what facts you would bring forward, even if you had no idea what this this topic was like. I mean, I'll give you one example. For example, why are people? Why is the Dutch national team so good at ice skating? That's an example of a question. So something like that kind of left field don't really think about it, but there's a few obvious things you can go for and what it is that you exactly go for. We there was a lot of stock conversation. You know what kind of stocks? Why are you interested in this? You know, your typical a lot of times that will give you like three different stocks and then say, which one do you think is good? My piece of advice on that would be just have a view. So don't sit on the fence. Don't say, Oh, I think this one's good, this one's good, this one's good, and then you don't have a conclusion. Make sure you say, I like this stock because they're really looking for people. We were looking for people with conviction in their sort of views, and it doesn't really matter what the answer is, and you're probably going to be wrong or right. It doesn't really matter. What matters is that you have conviction and you proved why you thought that was the case. So that was kind of the interviews, you know, there's a few sort of maths stuff. A little bit of one of them kind of made me do a stock test again,
Patrick (CEO of WSO): [00:24:38] Like a like.
Yuri: [00:24:40] So that was the consultant, actually. They just took out a page from the Greek exam and they just gave me like 20 grade questions and they said, here you go, which is, I think if you, you know, the Greek is it's not easy, right? I actually think sorry, it was a GMAT degree, so slightly harder mathematics. But I think it's quite intuitive math.
Patrick (CEO of WSO): [00:25:01] So probability and common metrics a little bit in
Yuri: [00:25:04] There, that kind of that kind of stuff. And it was sort of just go for it. And I mean, I think I did alright. So because I got offered the job in the end trying to think back to the other interviews, I mean, genuinely, I when I interview, I just ask people, tell me about something interesting. You read, tell me, you know, explain to me, like, maybe your dissertation or topic that you would know really well or a topic. And I just want to see how people see the world and understand things. I'd often ask people their relationship to risk, like, what do they feel like about risk taking? Because at the end, investing is a lot about psychology, right? So I'm trying to understand, is this person suited for the psychology of investing? I mean, and you won't know until you actually buy a stock and it goes down and things go badly. That's really the lesson is panic.
Patrick (CEO of WSO): [00:25:52] Yeah, exactly. Person can't come to work. They're sick all day or the next day because they're.
Yuri: [00:25:57] As everyone's experience that kind of environment. But it was it was just they just I think it was my ability to converse on a very high level about what was going on in the world. You know, at the time, there were so many
Patrick (CEO of WSO): [00:26:13] Reading that just comes from reading so much. You were actually interested in it. And what
Yuri: [00:26:17] Exactly. And it's not something you can kind of cheat at, which is the other thing that comes out from it. You really just have to put in the hours of work of reading up to that point. And I'd be surprised as well how many times I've asked people tell me something interesting you've read and they say stuff that they read in the mornings left that I've obviously also read, which is not a good answer. So actually, the most amazing answers I've got had nothing to do with finance. They were about something completely different, and it just shows that investing kind of covers everything, doesn't it, in the world, which is what I think.
Patrick (CEO of WSO): [00:26:55] So that's interesting. Let's go back to you, star, you get the offer after flying. Did you get to go back to Thailand and Vietnam or.
Yuri: [00:27:04] Yeah. So I fly, I fly back and I fly back to Bangkok. I land in the airport. I open my email. I don't think we actually have phones. Then, you know, maybe we did.
Patrick (CEO of WSO): [00:27:14] I can't remember three offers. You have
Yuri: [00:27:16] Three offers. I've got three offers. I'm like, ecstatic. I'm like, This is amazing. I obviously put it down to the fact that I managed to fly all the way there and, you know, in one piece, and then they I had to sort of decide which one to go for. And, you know, as I said, the consultant job it was it was because I had a particular interest in kind of non-profit and they managed a lot of help. A lot of non-profit organizations manage money. I thought that was interesting, but in the end, I decided I would rather be in charge of my own destiny. And then, you know, it comes down to things like, how much are they offering you? Did you like the people that you like the culture of the company? Have they had good performance historically or they sort of mostly owned?
Patrick (CEO of WSO): [00:27:54] But how much do they share of that like performance before going in? Like, where did you get more information from certain funds than others or?
Yuri: [00:28:02] And yeah, you get a little bit more from funds than others. But to be honest with you, I think these are really important questions. Just ask the people that are your interview. How is the performance been over the last couple of years as long a track record as you possibly can see who owns the firm, who's the main decision maker, how are decisions made? It's often questions people don't ask because they often see a brand name and they're like, OK, that I think I know what that is, and it sounds procedures. So it's great. But I think it's very important to ask those questions, particularly the employee owned culture. So it's quite well spread out like everybody's had a bit of a share in the company made it feel like a family, almost. And that was very important. The track record was excellent. The decision making was devolved to all the different fund managers. So they it meant that you could influence people a bit more than if, say, there was a committee or there was like one person who made all the decisions. I don't want to sort of paint lots of other funds in different bad lights, but over time I've learned that those are the things that make good cultures, especially for younger people coming in to learn about
Patrick (CEO of WSO): [00:29:04] Flatter, more kind of flatter structure with different fund managers that could be influenced by the analysts and the
Yuri: [00:29:11] Associates exactly what structure the same office. And your idea can sit in lots of different funds. It's a perfect environment for someone to thrive.
Patrick (CEO of WSO): [00:29:21] So I don't want to keep it too much time, but let's quickly run through like what was it like when you first started?
Yuri: [00:29:26] What were the surprises? So, so investing is really hard. Was the first surprise. It really, really sucks when you get something wrong. It was a it's a weird environment that almost every millisecond you know exactly how well you're doing, which is a different mindset from being in school, where you're getting graded or whatever, and you sort of roughly know how you're doing, but you don't. Whereas imagine every if you're working at school, like every second someone comes to you and says, OK, you're doing great, you're doing great. Oh, actually, you're not doing so great. You're doing great. It's a weird sort of mentor. You're here like that exactly in your ear constantly. There's a lot of sort of noise going on. You need to kind of learn to channel all of that out. You need to learn to accept the fact that that's your performance going to be assessed like that. You need to also start learning about your own psychology, which is a big thing that kind of shocked me to begin with that, you know, the stock market kind of invites activity. There's a lot of psychology that's involved. And so I spent quite a lot of time learning the psychological side of things, and I think that's really, really important to get to grips, especially in the second learning curve. I was very fortunate. I had really great sort of mentors and people who just were fantastic and kind of selflessly helped me to at a very granular level on how to understand how to analyze companies and to look for various things. And then I had slightly more senior mentors who really took the time, you know, sit down for you for an hour and explain their thought process. So it was a very nurturing environment for people to learn how to how to invest, essentially. How did you
Patrick (CEO of WSO): [00:31:06] Progress? Did you feel like your performance just got better and better and better? Or did you hit a rough patch? How did it? How did it evolve?
Yuri: [00:31:11] Yeah, it's I mean, I think at first we were learning so much and we got good. But it's sort of it's a bit of, you know, the stock market is like this. I mean, I was fortunate that it just went up pretty much if you think about the whole ten years, exactly also years. Nineteen was just a bull market. I mean, we had a wobble in 2011 where you were.
Patrick (CEO of WSO): [00:31:33] You net long then most of the time.
Yuri: [00:31:35] Yeah, because it was I was mostly the hedge fund wasn't that long. And then I also then when I transitioned to the long only fund, we were obviously quite happy for the stock market to go up and we were sort of quite bullish on things in the UK that were going up. So it's sort of it helps. I mean, obviously, when things are going well, we had a rough patch in twenty sixteen. During Brexit, which was obviously meant great to be in a UK fund and Brexit. Those are the real learning experiences like you really learn a lot about yourself and how you're able to deal with these kinds of environments. And you have to make quick decisions and understand what's going wrong. And sometimes you have to just walk out of a stock because you realize that doesn't have a future overnight. And that's what's happening in corona, and sometimes it's difficult to make these decisions. So it wasn't all sort of rosy and fun, and there were very tough times and you made mistakes. But the key thing I think is just we spend a lot of time learning from those mistakes. And then you just got better the next time around because you saw it before. And having good mentors really, really helps a lot because they've been through all of this multiple times over.
Patrick (CEO of WSO): [00:32:38] And looking back at your time, there anything like so you started off as what? What was like your title? Like a manager, just an analyst, hedge fund?
Yuri: [00:32:47] Yeah, I started off as an equity trainee analyst. Then I was became an equity analyst and then I was promoted to basically co-manage the fund. So essentially there was a pool of sort of analysts and then people who had fund management responsibility got promoted, and I was just a fund manager and then I became kind of co fund manager of this fund. I had a central year.
Patrick (CEO of WSO): [00:33:08] How did your responsibility shift from doing the actual analysis to kind of managing more of the ideas coming into you?
Yuri: [00:33:13] Yeah, it's a good question. Very, very good question. It depends on the firm you work for. Mcgeady, the fund managers did a lot of the analysis work themselves, so everyone was a generalist. Everyone will focus on whatever area of the market they thought was interesting. Everyone was doing their own work. Obviously, the analysts were producing research or reading it, but you had to be able to interrogate it at their level, which is how we were sort of brought up to do this type of thing. So I would say it changed, but it didn't. The things that changed is you had to figure out how to construct a portfolio, how to size positions, how to make investment decisions consistently.
Patrick (CEO of WSO): [00:33:51] Did you feel like when you became a manager where there's certain analysts that clearly? Were better performers or did it wax and wane in such a way where, like, was there ever like how many people, first off, how many people were under you at any given time?
Yuri: [00:34:06] So for the income fund that I call managed with my boss, we had two analysts directly under us. And then there was a sort of wider analyst pool of maybe sort of six or seven people as well.
Patrick (CEO of WSO): [00:34:15] Ok, so it wasn't like a ton of people. So you'd be you're working in tandem with those other two kind of discussing ideas.
Yuri: [00:34:21] I was working very closely with them. We were kind of a close knit family and that was what produced all of the ideas. Yeah. In terms of kind of waxing like people, I think. It's a little bit like basketball, and sometimes someone has a hot streak, sometimes they don't. The problem with stocks is that because our holding horizons to two to three years, you only really realize kind of further down the line and everyone can wait right in the stock. That's the thing. So it's although you can see the performance, it's very difficult to know. Has that investment actually matured as you expected it to mature? And that's the key thing that differentiate. I would say the JD was very good at hiring good people who wrote great research and made a really good investment ideas.
Patrick (CEO of WSO): [00:35:02] So if you had a four people looking into a job, some of this maybe in the UK or even in the U.S., but any advice you'd give them specifically around how to kind of survive inside a firm like this in terms of developing those relationships because I feel like a lot of it says it was it seemed like a great place in terms of culture and very kind of mentor, mentor centric, which helps, right? It makes you feel more confident when you have that down week or down year. Tell me a little bit about just anything that the students could do kind of position themselves to find, find a fund like that.
Yuri: [00:35:42] Yeah. So as I said, when you're looking for the fund for externally and make sure you ask all those questions about culture, about decision making, you know, frankly, you can even straight up ask people about the ego of people who's kind of calling the shots. This kind of stuff is it's fair game. You know, you're going to commit so much of your time and your sort of psychological headspace to this place to do that. When you were interviewed? Yeah. So I, you know, and I was lucky because during the crisis, McGeady was Great House survived the financial crisis that was hiring people. So I almost had like a self-selection because of bad funds weren't out there where they were sort of folding essentially at the time. And so I saw so I'd say, make sure you ask all of those questions. I'll be the first thing. The second thing is surviving this sort of environment is early on. What I really like seeing from analysts is kind of having a view and sort of sticking your neck out about things. I know it's really difficult to do. I used to force all of our analysts to put the conclusion kind of first on their any research piece they put it just makes you that mentality that this in the end, I'm going to have to make an investment decision on this. So you should be making an investment decision on this yourself. And that's really, really important. Just stick your neck out. Don't worry about it. The outcome will be what it will be. You're just learning at that point. That's important. But as you correctly pointed out, you need a very supportive kind of culture to allow you to make mistakes in that sense. And in the end, the mistakes is really how you progress as an investor if everything really went perfectly. I don't think you would actually learn what the skill of investing is all about you.
Patrick (CEO of WSO): [00:37:20] You're amazing. You'd have your ego would grow, probably over the years, right?
Yuri: [00:37:24] Exactly. Absolutely. And become completely astronomical.
Patrick (CEO of WSO): [00:37:28] So, Tom McKenna, what's next for you? Where can people find you? Obviously, snippets finance anything else if you want to share before, before calling.
Yuri: [00:37:37] Yeah, so definitely sort of check out snippets of finance. You know, that is a I love that project. I'm going to be doing that for a long period of time is going to be writing that content. There's a contact sheet contact email address there. So just drop me an email if you have any questions or anything like that. Always happy to chat and do quite a lot of that kind of stuff. And then I think I'm going to, you know, probably take a bit of a holiday because I've been doing this master's and it's been full on, if you can imagine. And after that, I'm just going to get back into investing in some shape or form. Exactly how that looks is not yet determined.
Patrick (CEO of WSO): [00:38:10] Essentially, you think potentially another asset manager or hedge
Yuri: [00:38:13] Fund either add another asset manager doing something on my own, maybe with some former colleagues or potentially coming up with something slightly related to biotech? Those are the three things I'm working
Patrick (CEO of WSO): [00:38:24] On that would make sense given your new
Yuri: [00:38:28] Master's.
Patrick (CEO of WSO): [00:38:29] Well, listen, Uri, thanks so much for taking the time. I really appreciate you sharing your story with all the listeners and with me.
Yuri: [00:38:35] Great. Thanks very much, Patrick. Fantastic.
Patrick (CEO of WSO): [00:38:37] And thanks to you, my listeners at Wall Street Oasis. If you have any suggestions whatsoever, please don't hesitate to send them my way. Patrick at Wall Street Oasis. And till next time.
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