Hedge Fund CEO On Opportunities In Investment Management
Bob Jenkins, currently CEO of Combinatorics Capital
Graduates should try to understand themselves and what they enjoy doing says Bob Jenkins, the American who headed F&C Asset Management for 12 years.
“Are you quiet, analytical, thoughtful, or do you like sales?” asks Jenkins, who is currently CEO of New York-based macro hedge fund Combinatorics Capital.
He thinks there are jobs in investment management for every personality type: people who are good at process work in operations, people who are good at marketing work in sales, people who are diligent and analytical may end up as portfolio managers, and people who enjoy the excitement of daily results lean towards trading.
Like all businesses, investment management firms have a full range of activities. Start by knowing yourself and then apply for the right type of role, advises Jenkins.
Jenkins, 59, recently returned to the US after 30 years abroad. He is best known as the first non-British person to run F&C Asset Management, first as CEO and then as Chairman.
He transformed F&C from a privately held, UK-centric boutique into a pan-European, London Stock Exchange-listed firm with assets under management exceeding $150 billion”
Ohio-born Jenkins graduated with a Masters in International Studies from Johns Hopkins University in Washington DC and joined Citibank in New York.
As he puts it, “Citibank was my travel agent.” He was posted overseas as a junior trader, and spent 16 years running ever-larger trading operations in Dubai, Bahrain, Zurich and Tokyo, ending up with responsibility for setting Citibank’s trading room limits globally.
Jenkins switched from sell-side to buy-side in 1992, becoming Chief Investment Officer and Head of Asset Management for Credit-Suisse in Japan. The firm moved him to London in 1995 and he joined F&C the following year.
His move to Combinatorics Capital, is a “bridge back to the US” and “an opportunity to work with talented people I know well”.
He now divides his time between New York, his family vacation retreat in Montana, and London, where he teaches asset management at London Business School.
Looking back at his formative years at Citibank, he says that it was, “an era when organisations were more paternalistic and more long term-ist”.
The investment Citi made in his training, and the opportunities to work on diverse assignments turned him into a global manager.
Now, he says, there are too many specialists in finance who “can’t see the wood from the trees”.
Executive Managers more popular in investment management firms
Jenkins cites a KPMG study of ten years ago that showed the high number of Chief Executives in the asset management industry who had been promoted from portfolio management roles.
He thinks this CIO-to-CEO transition is less common today, and that firms are increasingly promoting people with demonstrable executive talent. Skills in marketing, finance, business planning, and proven people management are increasingly sought after in the industry.
“The single biggest difference between investment management today and a decade ago is that organisations are run to much higher business standards and with a higher value placed on executive management talent”.
Rewarding people who generate alpha is the most critical challenge for the asset management industry, he adds.
“Are there people who can add value? Yes. Can the aggregate of all managers outperform the average? No”, says Jenkins.
The tools and precision with which portfolio returns can now be attributed either to the market or to the manager’s skills leaves less room for money managers to hide.
Jenkins isn’t an MBA himself, but feels that Citibank in its heyday was akin to a business school. In his first couple of years he was sent for boot camp training in accounting, credit analysis, balance sheets and income statements.
During his time at Citibank he employed lots of MBAs: it was normal for US banks to recruit from the top business schools. At F&C the appetite for MBAs was a lot less, but Jenkins says he did seek out specialist managers for some positions.
And what does this non-MBA like best about teaching MBAs? “Two things,” says Jenkins. “I enjoy being surrounded by such boundless energy and optimism. And secondly, through their thoughtful questions these bright young professionals teach me very quickly where my knowledge gaps lie. Humbling but satisfying.”
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