Focus on the downside and let time work in your favour
Nordic Fund Selection Journal has been catching up with Cecilia Thomasson Blomquist, chief investment officer of Sweden’s PP Pension, to talk about her current job and the best and worst in her career.
By: Caroline Liinanki (texten är tidigare publicerad i Nordic Fund Selection Journal)
How did you end up working within the asset management industry?
I started my career in a treasury department of a Nordic construction group in the late 1980s. Those years were a very interesting and exciting period to be in that industry. Some years later, I got the opportunity to join the invest- ment team of AP1, one of the national pension funds, which at that time had almost one-third of the total outstanding Swedish government debt in the portfolio. Since then, I’ve remained in this industry for almost 25 years.
What are the best and worst things in your current job?
If you’re interested in macroeconomics, politics, develop- ments in the world and business, this is the best job you can have. You have to make analyses based on all these facts and how they impact the markets. You then have to make decisions based on your view. The worst thing in this job is the anxiousness to lose money – because clients have trusted you to keep the money safe and to make it growth.
What would you do if you didn’t work in the financial industry?
I’ve asked myself that question many times and I’ve never found a good answer. I like to see results that you can measure, so I probably would have ended up in some other business area. When I started to work in the financial market in Sweden, the market had recently been deregulated and therefore very young and not that developed. I appreciated being part of the development and if I had chosen to go into some other industry, I would probably have chosen some area with a high pace of change.
What’s the best moment in your career so far?
That’s hard to answer. Some of the best moments come annually when you measure your result and can conclude that you’ve had a good year.
What’s the biggest investment mistake that you have been part of making?
Nobody can foresee the future and I probably make mis- takes every day. I was negative about the market in 2008 but could never have imagined the magnitude of it.
What are the strengths and weakness of your investment strategy?
Diversification is an investor’s best friend. My investment style is to focus enough on the downside so that you can stick with the risk you want to have in your portfolio. If you never become a forced seller, you can let your investments do the work for you. In the pensions industry, you keep capital working for you in the long run and such a strategy becomes very powerful. Time works in your favour. The weakness of the strategy might be that when markets are rallying, you can’t keep up with them fully.
What changes are you currently looking to make to your investment strategy?
Preparations for when the market changes direction. Today, the central banks are running a very loose monetary pol- icy. Almost all markets have had very strong returns for a number of years.
What’s the key issue on your mind at the moment when it comes to your portfolio?
Keeping control of what you have in your portfolio.
What do you like to do when you´re not working?
I like to spend time with my family and friends. I love skiing and to live an active outdoor life.