Ep55: Nicolas Rabener – Diversification: An Easy Way to Reduce Your Investing Risk
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Guest profile
Nicolas Rabener is the founder of FactorResearch, which provides quantitative solutions for factor investing. Previously he created Jackdaw Capital; an award-winning quantitative investment manager focused on equity market neutral strategies. Before that, Nicolas worked at Government of Singapore Investment Corporation (GIC) in London focused on real estate investments across the capital structure. He started his career working in investment banking at Citigroup in London and New York. Nicolas holds a Master of Finance from HHL Leipzig Graduate School of Management, is a CAIA charter holder and enjoys endurance sports like 100km Ultramarathon, Mont Blanc, and Mount Kilimanjaro.
Listen as Nicolas will uncover the worst investment experience in his real estate venture. Learn why it is important to avoid complexity in your investments.
“I would urge most people to dramatically reduce your portfolios from a complexity perspective, especially on the retail side.”
Nicolas Rabener
Topics Covered:
00:41 – Andrew introduces our guest with his educational and working experiences
02:27 – Nicolas reveals what made him become an investor
04:32 – Telling how he evolved in his job investing in real estate stocks
06:28 – How persistence in doing marathons relates to investing
08:32 – Sharing his first investment loss in his career when overseeing the real estate fund of Jackdaw Capital involving two companies managing prisons on behalf of US government
16:48 – Andrew mentions his takeaways from this story
18:32 – Nicolas gives a piece of actionable advice to our listeners
20:44 – Andrew wraps up the show and emphasizes three important things: create, grow and protect your wealth
Main Takeaways:
Lesson 1: “Sometimes logic isn’t what happens in the stock market. Sometimes people overreact, or they may not think fully and completely that only 10% would potentially be at risk.”– Andrew Stotz
Lesson 2: “Expect the unexpected, because, from a real estate perspective, this is an asset-backed business. So, I guess the learning curve is that no matter how defensive in what you can expect, sometimes you do get punched in the face.”– Nicolas Rabener
Lesson 3: “Avoid the complexity because complexity on the investment side is often the enemy.”– Nicolas Rabener
Lesson 4: “We generally create wealth from a business. If you go into the stock market thinking you’re going to create your wealth; you’re probably going to lose. However, the stock market is good for growing your wealth. In protecting your wealth, for investors out there, some of the academic research I did showed that in Asia you need about ten stocks to diversify away.”– Andrew Stotz
Connect with Nicolas Rabener:
Andrew’s books
- How to Start Building Your Wealth Investing in the Stock Market
- My Worst Investment Ever
- 9 Valuation Mistakes and How to Avoid Them
- Transform Your Business with Dr.Deming’s 14 Points
Andrew’s online programs
- Valuation Master Class
- Women Building Wealth
- The Build Your Wealth Membership Group
- Become a Great Presenter and Increase Your Influence
- Transform Your Business with Dr. Deming’s 14 Points
Connect with Andrew Stotz:
About the show & host, Andrew Stotz
Welcome to My Worst Investment Ever podcast hosted by Your Worst Podcast Host, Andrew Stotz, where you will hear stories of loss to keep you winning. In our community, we know that to win in investing you must take the risk, but to win big, you’ve got to reduce it.
Your Worst Podcast Host, Andrew Stotz, Ph.D., CFA, is also the CEO of A. Stotz Investment Research and A. Stotz Academy, which helps people create, grow, measure, and protect their wealth.