Ep12: Stuart Leckie – The Cost of Friendship: How your Friends Impact Your Investment Decision

Stuart Leckie is based in Hong Kong and advises on investments and pensions in Hong Kong and Mainland China. He is the author of books titled “Pension Funds in China” and “Investment Funds in China”. He was Founding Chairman of the Hong Kong Retirement Schemes Association, acts as an advisor or trustee to a number of funds and was the Chairman of the CFA Institute Advisory Council on Standards and Financial Market Integrity.

Stuart Leckie worked in life insurance in the UK before moving to Hong Kong. He served as the Chairman of Willis Towers Watson (formerly Watson Wyatt) in Asia-Pacific and as Chairman of Fidelity Investments, Asia-Pacific. He has advised the Chinese Government on pension’s reform and advised the Hong Kong Government on the establishment of the Mandatory Provident Fund.

In this episode Stuart shares his worst investment ever story, investing £500,000 in an affiliate product he did not deeply understand which was actually offered by a trusted friend. Eventually, he stopped investing further after realizing he needed to do more due diligence into the person he originally trusted.

 

 “Do not be afraid to ask information to people. If they do not like it, the investment is not for you.”

Stuart Leckie

 

 

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Topics Covered: 

00:44 – Stuart Leckie’s professional and personal background

02:33 – Stuart shares his worst investment ever story venturing into an affiliate product he did not understand

03:40 – Finding out that his trusted friend did not do his due diligence about the investment

04:28 – One of the personnel of the investment unaccounted the collected investment to the fund

06:11 – Availing the UK government grant for tax refund

07:16 – Lessons that Stuart learned from the experience

08:17 – Importance of reporting and transparency in any investment

09:42 – The circumstance that led him to invest in the fund his friend was offering him

10:40 – The different investment red flags Stuart encountered

 

Main Takeaways

  • Lesson 1: Do not touch things you do not understand. Get proper due diligence done. Performing due diligence will give you the necessary information that you need and it will help you vet out a possible investment.
  • Lesson 2: Do not be afraid to question and challenge the people involved with your investment. If they do not like that, it may mean that they are not the ones you should be investing with or that the investment is not for you.‬
  • Lesson 3: Importance of reporting and transparency in any investment.  Regularly sending the newsletter about the investment is important. Listing over the 9-parts bad news and the one-part good news. Financial reporting is important because people make their investment decisions based on the financial data of the company.
  • Lesson 4: Never be afraid to tell bad news. You actually build a good reputation over time if you are the person that is willing to talk about it and say what you have learned from it.

 

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About the author, Andrew

Dr. Andrew Stotz, CFA is the CEO of A. Stotz Investment Research, a company that provides institutional and high net worth investors with ready-to-invest stock portfolios that aim to beat the benchmark through superior stock selection.

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