Ep56: Tahnoon Pasha – Building Long/Short Hedged Portfolios with Your Trusted Team

Tahnoon Pasha grew up in the United Kingdom and the United Arab Emirates. He has a Bachelor of Business Administration and an M.B.A. from the University of Karachi, Pakistan. He is a chartered financial analyst and has been a member of the CFA Institute since 1995. He is based in Spencer Stuart’s Singapore office and is a member of the firm’s Financial Services Practice. Before Spencer Stuart, Tahnoon was the co-founder and the chief executive officer of Cynopsis Solutions. He also served at Aviva Investors as CEO of both the Asia Pacific regional hub in Singapore and the equity and fixed income businesses in the region. And for some years, Tahnoon worked as head of regional equity investments for MFC Global Investment Management (Asia).

With nearly three decades of experience in the investment management industry, Tahnoon specializes in financial services searches, working with a range of clients in the asset management, insurance and sovereign wealth sectors in Southeast Asia.

Get to know Tahnoon as he unveils what he considered his worst investment ever. Understand why it is very crucial to be cautious about your level of conviction to a particular sector or trade, and why it is very crucial to work with the right team that you can trust and will speak truth to you and that will help you become a better investor.

 

I think the mistake was the level of conviction I invested in that particular trade.

Tahnoon Pasha

 

Topics Covered:

00:45 – Summary of our guest’s educational and professional background

03:19 – Tahnoon narrates why he considers structural underweight in his portfolio his worst investment and the two important circumstances leading to it

05:54 – Explaining why it is hard to model the levels of return and the modeling perspective missed

10:25 – Summing up the remarkable lessons learned from his experience

12:00 – Andrew shares his takeaways

16:44 – One actionable advice from Tahnoon: “Surround yourself with smart people.  If you’ve got people around that you can trust and who will speak truth to you, you’re going to be a much, much better investor. Don’t try and do it alone.”

18:03 – Parting words from our guest

 

Main Takeaways:

Lesson 1: “First was that I misread the boom itself. The second was that I misread the effectiveness of the change in production models that had that boom based on outsourcing and contractual arrangements rather than on direct consolidated, centralized manufacturing.”– Tahnoon Pasha

Lesson 2: “What’s interesting about valuation is nobody knows what the value is until it arrives. So, we’re left making assumptions in models.”– Andrew Stotz

Lesson 3: “There are cases when the assumptions that seem to be traditional and realistic get blown out of the water, and it’s not so much that the model is flawed.  It’s just that if you force yourself to operate only within that model, you may force yourself to make assumptions. That just may not be the case in a unique situation of an exploding industry.”– Andrew Stotz

Lesson 4: “It turns out, the auto industry is not a good model for technology. It didn’t have the same kind of cost downs regarding the iterations and obviously, the time between generations in the auto industry was much longer and slower than we saw in technology. What we really should have thought was about how the industry was playing out in and of itself and by trying to use proxies that were poor matches for the for the industry. We lead ourselves wrong.”– Tahnoon Pasha

Lesson 5: “Without the right assumptions, it’s hard to come out with the right result. And it’s not always the structure that’s to blame.”– Andrew Stotz

 

Resources from Andrew Stotz:

 

Connect with Tahnoon Pasha:

 

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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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