Tag Archive for: CFA

Quarterly investment letters–Tell me “What makes them great?”

Quarterly investment letters are central to many asset managers’ communications with their clients. That’s why I’m asking your help in defining what makes them great.

Please answer my six-question survey (NOTE: I’ve removed the link to this expired survey]. I’ll report on the results in a future blog post.

You inspired me. Thanks!

Investment professionals care intensely about these letters, as I learned when I asked members of  my LinkedIn Groups the following question:

The responses to this “one word” question inspired this survey. I feel fortunate to belong to this community. Thank you!

The CFA Institute made me do it: A social media tale

I didn’t want to do it. I didn’t want to develop a business presence on Facebook. LinkedIn, Twitter, and my blog kept me busy enough.

But then I heard that the CFA Institute had way more followers on Facebook than LinkedIn. How many? I forget the numbers I heard at the institute’s 2010 annual conference, but more recent statistics include

  • Facebook – more than 40,000 fans
  • LinkedIn member group – almost 14,000 (and 27,000 in candidate group)
  • Twitter – more than 8,000
  • LinkedIn company page – almost 3,800

I found these stats in “The CFA Network” in CFA Magazine. The big gap between Facebook and other social media made me think seriously about Facebook.

I’m not saying that 40,000 fans on Facebook are worth more than 14,000 group members on LinkedIn. It seems as if the CFA Institute’s LinkedIn members are more engaged than its Facebook members. I enjoy my conversations on the group very much.

However, the Facebook numbers made me think about delivering content the way my readers want. I’ve blogged about this in “Great blog posts don’t matter…” Eventually I started an Investment Writing Facebook page. The Facebook page has become another way for me to share my blog posts and to experiment with starting conversations.

My Facebook page is still evolving. I haven’t found the right formula yet. But I’ve had fun experimenting. Thank you, CFA Institute!

Reader question: How can I become a freelance financial writer?

Aspiring freelance financial writers seeking advice contact me occasionally. If you’re one of them, here’s some advice.

“Freelance financial writer” is made up of three words, each of which contains clues to the freelance financial writer’s success. I discuss them below in order of importance.

“Writer”: Polish your wordsmithing

Do whatever you can to improve your writing, including

“Financial”: Learn about the business

I took many great classes through the Boston Security Analysts Society on my way to earning my CFA (chartered financial analyst) credential. Your local society of the CFA Institute, other professional societies, or colleges may offer relevant classes in person or online.

Industry experience helps, too. I took my first job in financial services back in the 1980s.

“Freelance”: Learn how to survive

You may be a great writer with a strong command of finance. But if you can’t run a business, you’re lost.

Here are some online resources for learning more about freelancing:

“Freelance financial writing”

Here are some relevant posts from my blog. While they’re aimed at CFA charterholders, they’re relevant to others who understand investments.

If you have more suggestions for aspiring writers, please leave a comment.

If you’re in New York City, you can pick up more writing tips from me at my New York Society of Security Analysts presentation on “How to Write Investment Commentary People Will Read” or the  annual writers conference of the American Society of Journalists and Authors.

April 2013 presentations by Susan Weiner, CFA

New York Society of Security Analysts on April 28

I’m leading a workshop on “How to Write Investment Commentary People Will Read” for the New York Society of Security Analysts (NYSSA) on Thursday, April 28, 2013. The meeting runs from 12 noon to 1:30 p.m. The program is for NYSSA members only. Pre-registration required.

Professional Association of Investment Communications Resources on April 28
How to Write What People Will Read About Investments” is the focus of my presentation for the Professional Association of Investment Communications Resources, more commonly called PAICR. It will run from 3:30 p.m.-5:00 p.m. It is open to non-members. Pre-registration required. Spots are filling quickly, so register now!

Also in APRIL: American Society of Journalists and Authors 2011 Conference

I will moderate–and speak on–panels about corporate writing and white papers at “The Write Road to Success,” the annual conference of the American Society of Journalists and Authors.

My panel on “Writing White Papers” takes place on April 30, during the part of the conference with registration open to the public. This event is also in New York City.

Diversification: Andre Perold’s take on its value

“Diversification shouldn’t be viewed as protecting you from losses in wealth but rather from being concentrated in the worst-performing asset classes.”

In other words, diversification puts a floor under how badly you can do when all asset classes fall.

This struck me as a valuable insight from “Harvard Business School Professor Andre Perold Looks At The Forces Reshaping the Business of Asset Management,” on the blog for the CFA Institute’s Second Annual Middle East Investment Conference.

Other points I took from the CFa Institute’s summary of Perold’s talk include the following:

  • The value of classic endowment-style management has run its course because “the low-hanging fruit has been picked.”
  • New instruments that separate alpha and beta are useful; Now asset managers don’t have to “leave significant money on the table.”
  • Stable-weight portfolios should be replaced by portfolios with stable risk budgets. (I’ve written about Perold’s views in “Stable Risk Portfolios: A Timely Alternative to Static Asset Allocations?“)

Best European investment opportunities are cyclical, say strategists

European cyclical stocks and banks in the continent’s peripheral countries offer the best investment opportunities, according to Ian Harnett, managing director for European strategy at Absolute Strategy Research (ASR), a London-based macroeconomic research firm. He made his comments during “Europe: ‘This could be Heaven or this could be Hell,’ ” a March 17 presentation to the Boston Security Analysts Society.

Reasons to favor cyclical stocks from Europe’s core countries

Why cyclicals?

“Globally, excess liquidity will continue to make ‘risk assets’ more attractive,” said Harnett. Cyclical stocks in core Europe will benefit most from loose monetary policy and weak exchange rates.

More reasons to favor cyclicals include the following:

  • The VIX measure of volatility will fall closer to 10 by year-end 2011, in Harnett’s opinion
  • European Union stocks remain cheap, using 10-year trailing earnings per share–They are still below lows hit in 2003 and earlier
  • European cyclicals tend to do better when the yield curve flattens
  • Dynamic earnings growth will support these stocks

ASR’s perspective on Europe’s crisis

The main points I took from ASR’s description of Europe’s situation were

  1. The important of cyclicality
  2. A shift in relative cost of capital between core and peripheral Europe
  3. The survival of the euro

Europe’s woes have both structural and cyclical elements, said Harnett. However, he said, fiscal deficits such as we’ve seen recently are nearly always cyclical rather than structural. Harnett made his point with a graph showing the correlation between “Budget Balance as a % of GDP” and “Industrials Hiring Intentions.” “This has been a jolly good indication of deficits until now,” he added. “Europe’s woes are more ‘cyclical’ than ‘structural,’ ” he concluded.

Investors are moving into “safe havens,” such as Germany, at the expense of Europe’s peripheral countries, Harnett said. As a result, the core countries of Europe are paying an inappropriately low cost of capital. German consumer confidence is at record highs, so they are spending.

“The German locomotive can carry a very heavy load,” said Harnett. German excess demand is being funneled to Europe’s peripheral countries. Germans are vacationing abroad and buying peripheral countries’ exports. Trade imbalances within the euro zone are shrinking. Eventually, banks will benefit, especially in the peripheral countries, assuming they survive the current turmoil. ASR is currently very long on European peripheral banks and neutral on the banks of core Europe. Harnett added that he expects ASR’s next move will be to overweight core banks.

The euro is a political creation, so politicians will ensure its survival, according to Harnett. So your investment strategy shouldn’t bet against the euro, if you agree with ASR’s opinions.

For more on ASR’s views, go to “Japanese crisis good for European economies” and “U.S. companies may move supply chain home.”

New publishing opportunity for investment professionals

Investment professionals, mark April 1 in your calendar if you’re interested in expanding your professional publications.

April 1 is the deadline for submissions for potential publication in the September 2011 issue of the New York Society of Security Analysts’ new online peer-reviewed journal.

The society says it is “particularly interested in articles on financial regulation and risk management.”

The journal is aimed at practicing investment professionals. Here’s how it describes its goals.

  • Educate investment professionals on theory and practice in securities analysis
  • Offer a forum for the latest in thought leadership in the investment industry
  • Promote discussion among various groups in the industry: professionals, regulators, private investors, company boards of directors and CEOs, students, etc.
  • Supplement the programs and professional development curriculum offered by NYSSA
  • Serve as a career development resource for readers

Start writing today!

Career strategies for wealth managers without a “book of business”

“I can’t get a job because I don’t have a book of business.”

I’ve heard many CFA charterholders in the field of wealth management say their career prospects are limited by their lack of clients who will follow them to a new employer. If you’re in this fix, I have some suggestions for you, thanks to a lively discussion on the CFA Institute’s LinkedIn Group. I’ve quoted only LinkedIn Group members who gave me their permission.

The wealth manager’s dilemma

Sometimes your technical skills aren’t enough to attract potential employers, especially now.

“When the times are good, the industry will place more value on the technical skills because of more demand for labor. When the times are bad, the industry will place more value on soft skills because of more demand for assets to manage in order to pay for labor,” says James H. Barker, Jr., CFA, managing director of Haynes Barker Investment Management in Tennessee.

The skills necessary to earn your CFA charter and to manage money for individuals and families won’t build your client base. At least not overnight. So what can you do if you need a job, but lack that all-important “book”?

In the near term, you can pursue one of the following courses.
1. Look for a company–most likely a large company–that hires specialists.
2. Become a consultant or start your own business using your analytical skills.
3. Become a great networker and marketer.

Career strategy #1: Work for a large company

If you want to focus solely on your technical skills, look for a company–most likely a large company–that hires specialists.

Ted Everett, CFA, a fellow Boston Security Analysts Society member, says “Larger firms accept a higher rate of turnover in clients as a necessary evil of their firm size but offset it with efforts by dedicated sales teams. They are more apt to add personnel to fill a gap in coverage without the portfolio manager having to bring a book with him/her. ”

Barker says, “Small companies will desire their employee/owners to be proficient with both technical and soft skills. Large companies will desire their employees to provide skills for what each is specifically hired for. To survive the bad times with a large company, you better have a book of business or the ability to communicate effectively to retain business and build for the future.”

Career strategy #2: Start your own business

You can become a consultant or start your own business using your analytical skills. This will require some marketing–but not necessarily asset-gathering–skills. However, consulting and some businesses don’t require as much of a “book of business” as a wealth management company would seek.

I know some consultants who work for only one client at a time. It’s a lot like having a regular job. The downside? These consultants are always looking for the next gig–or they have down time when they’re not making money. I’ve experienced this at times as a freelance writer. It helps to have an emergency fund to tide you over.

Here’s what David Malone, CFA, a fellow Boston Security Analysts Society member, says about his business.

I have found that without my own book, I cost too much, at least today. To solve this problem I started Wintergreen, which focuses on stock research versus asset-gathering. If a CIO is under cost pressure and cannot hire enough staff, I can fill the temporary stock picking needs on a contract basis.

This eliminates my need to gather assets and allows me to focus on what I love. I enjoy networking and informing CIOs and other managers that I can help them.

Career strategy #3: Become a great networker

If you hone your networking skills, you’ll be in touch with the right people once the right job becomes available. You’ll also have a better shot at developing the all-important book of business.

“Part of the answer, in my opinion, is to work on networking and telling one’s own story. This is not comfortable for many of us, but it is the only way to really participate in the market for knowledge work,” says David Robertson, CFA, CEO of Arete Asset Management in Baltimore, Md.

Other CFA charterholders recommend the following:

  • Taking public speaking or sales classes–I notice the New York Society of Security Analysts sponsors free Toastmasters meetings
  • Giving talks or seminars
  • Joining a chamber of commerce or other local organizations
  • Going wherever you can to meet prospective clients and referral sources

Should the CFA Institute and local societies play a larger role?

Several LinkedIn Group members suggested that the CFA Institute should more actively publicize the value of the CFA credential for wealth management. There’s also interest in local CFA societies helping members to develop their soft skills.

Reader question: Writing resources for equity research analysts?

“What are some good resources to improve my investment writing skills with an emphasis on equity research writing?” This question recently arrived in my email in-box.

Here are my suggestions:

I offer customized writing workshops for corporate clients in investment and wealth management. I’m not a research analyst. However, I’m good at analyzing client writing samples and then using them as the basis for training.

Equity analysts, can you suggest any additional resources?

I’m always interested in readers’ ideas.


July 24, 2013 update: Warren Miller, CFA, CPA of Beckmill Research, LLC has some more suggestions for you, starting with “Read what good analysts write, and then copy it by typing it into a Word document.” As you re-type that research, study what makes the reports good. That means looking at how the analyst tells the company’s story and at details such as sentence length, transitions, and measures of reading difficulty, such as the Fog Index. As Miller says, “Good writers read great writers.”

Disclosure: If you click on the Amazon link in this post and then buy something, I will receive a small commission. I only link to books in which I find some value for my blog’s readers. – See more at: http://investmentwriting.com/blog/?s=disclosure#sthash.NlvDZLSB.dpuf

May 30, June 3, and June 27, 2014: I updated this with additional links.

Disclosure: If you click on the Amazon link in this post and then buy something, I will receive a small commission. I only link to books in which I find some value for my blog’s readers.

Disclosure: If you click on the Amazon link in this post and then buy something, I will receive a small commission. I only link to books in which I find some value for my blog’s readers. – See more at: http://investmentwriting.com/blog/?s=disclosure#sthash.NlvDZLSB.dpuf




Social media lessons from the top nine Investment Writing posts for 2010

LinkedIn and Facebook are powerful.

The 2010 analytics on my blog made me appreciate the power of social media more than ever.

The influence of LinkedIn revealed itself in my most popular blog posts of 2010. These posts ranked high because they attracted attention in LinkedIn groups. “LinkedIn Groups Help Blog Posts Soar,” my guest post on the American Society of Business Publication Editors blog, discusses this phenomenon. I’d like to thank all of the LinkedIn members–and other visitors–who took the time to visit, forward, and comment on my blog posts.

As for Facebook, it has become a top five source of referrals to my blog. This is true even though I only launched the Investment Writing Facebook page partway through the year. Twitter didn’t rank as high as I expected on this count.

I also saw some themes in my most popular content. Top posts addressed marketing, social media, writing, and opinions of leading financial experts.

My blog’s nine most popular posts during 2010

  1. Notable quotes from the CFA Institute’s emerging markets conference
  2. My five favorite reference books for writers
  3. ISI’s Straszheim: China’s interest rate hike is “tapping the brakes”
  4. FINRA/SEC compliance guidance for bloggers
  5. “CFA credential implies a standard of care not always upheld,” says Forbes magazine opinion piece
  6. LinkedIn’s fatal flaw for financial advisor compliance
  7. Great blog posts don’t matter…
  8. “Has housing bottomed out?”–Karl Case and others on the U.S. housing market
  9. Reader challenge: What’s the writing lesson from Physicians Mutual?

Why top nine?

You may wonder why I’ve listed my top nine posts instead of the top 10.

It’s not because I’m ornery. I figured I might pique your attention with an odd-numbered list. Did I succeed?