An Introduction to Asset Management with PIMCO
Whether you had an internship at an asset management company, wanted to know more about the wider world of finance, or had no idea what asset management entailed, the PIMCO panel discussion offered a fascinating insight into an underexposed part of finance.
PIMCO was initially founded in Newport Beach in 1971, and expanded to London in 1998. It now has over 2000 employees globally, and manages $1.8 trillion worth of assets. As an asset management firm, PIMCO does not invest its own money - unlike investment banks - instead looking after the money of institutions, like pension funds or banks, or working with intermediaries who might in turn work with their own retail clients. PIMCO differentiates itself from other asset management companies in the way it manages client's portfolios. Instead of tracking markets and investing in a broad basket of shares and bonds, meaning portfolios perform in line with that, PIMCO offers active asset management, aiming for ALPHA: outperforming the benchmark. PIMCO employees are rewarded for contrarian thinking.
Why work in asset management? The four panellists, Cristina Nunziata, Sophie Florentin-Siu, Fiona Furlong, Madalina Corneanu, and the moderator Laura Kelly, had their own perspectives on the matter. For Cristina, asset management is all about the longevity and depths of client relationships; PIMCO has client relationships dating back 20 years in the United States, and therefore is able to create meaningful business connections. She compared this to her experience in investment banking, where the majority of work is deal driven, and therefore relatively short-term. The longevity of client relationships reflects the long horizons in asset management; managers have to have a long-term understanding of different markets. The panel agreed that the asset management industry had changed in the last few decades, with clients taking fewer risks. In addition, clients both want more value for what they pay, and want their investments to be environmentally and ethically responsible.
Why work for PIMCO? Each panellist stressed both the responsibility and training they were given from day one on the job. Fiona emphasised that although the learning curve was steep, it means that each PIMCO employee understands all aspects of the company. Indeed, Laura highlighted that the company culture was one of learning, with regular symposiums open to everyone from associate level to senior partners. Moreover, PIMCO has a variety of different roles, suiting different types of people: where Sophie enjoys client interaction, Fiona prefers a data-focussed role, and Madalina relishes the nitty gritty of portfolio research. All the panellists enjoyed the constant challenges of their roles, and loved that each day presented a different problem, the resolutions for which were incredibly satisfying!
The inevitable question for every successful businesswoman is how to achieve a work-life balance: how does one have a challenging and demanding job at the same time as other interests or responsibilities? Cristina argued that you need to prioritise, since it is impossible to keep doing everything. Ultimately, you must choose the things that are most important to you and make sure those happen; write down rules for your life, and follow them. The changes of the last decades mean that flexible work is increasingly available, but more importantly, company cultures are changing. When Cristina started work, she was the only female trader at her investment bank. PIMCO has momentum around diversity, and aims to leverage difference, so that they can be more responsive to client needs. The most important thing is that your work is rewarding, because this heightens the ups and tempers the downs.
Following the wide-ranging discussion, drinks and food afforded members the opportunity to talk to panellists and ask their own questions. The event was a fantastic way to find out more about asset management, and to hear how different women have succeeded in the field!