Today is a very special episode with Mike Kerins, CFA, FRM. Mike founded and is the CEO of RobustWealth, a financial technology company, which provides financial advisors an institutional-quality robo-investments solutions. Prior to this, he was VP, Head of Asset Class Research at Franklin Templeton Investments. Mike is a graduate of the University of Colorado Boulder with a Bachelor’s in Finance and Chemical Engineering. He also completed a certificate in Computational Finance from the University of Washington. In today’s episode we discuss the present state of financial advisors, the problems facing them, and his company Robust Wealth.
Q1 hedge fund letters, conference, scoops etc, Also read Lear Capital: Financial Products You Should Avoid?
David Einhorn's Greenlight Capital returned -2.9% in the second quarter of 2021 compared to 8.5% for the S&P 500. According to a copy of the fund's letter, which ValueWalk has reviewed, longs contributed 5.2% in the quarter while short positions detracted 4.6%. Q2 2021 hedge fund letters, conferences and more Macro positions detracted 3.3% from Read More
RP – “Just want to know what those principles in engineering are that you applied to finance?”
Mike Kerins – “If you know chemical engineering, the big course work is material and energy balance. There is a lot of great concepts in regard to applied math that go into that which is also applicable to finance. Another big component that we learned in engineering that you can apply to finance is building robust systems. Hence where RobustWealth came about. In chemical engineering, if you don’t build a robust system, then chemicals mix inappropriately, or it gets to hot and it explodes. In finance, when you do financial modeling, if you don’t build a robust model, then what that means is poor data, which happens all the time in finance, can heavily influence your model to make wrong investment decisions. So perfect example of that is mean variance optimization. That is not really a robust optimization process because your return expectations drive a lot of it and your return expectations has a huge error around them. I would say that robust system principle is key in both chemical engineering and finance.”
1:04 – Tell me about your background and what led you to finance?
1:48 – Just want to know what are those engineering principles that you used to apply to finance?
3:27 – Your company RobustWealth, can you tell me how that got started and the inspiration behind it?
4:37 – Can you tell me more about your company and the lessons you have learned so far as an entrepreneur?
7:28 – Can you share some reflections looking back because you started 2 and half years ago? What was the biggest surprise?
8:50 – What is the mission of RobustWealth?
9:32 – Can you tell me about the present landscape that financial advisors face today?
11:53 – In regard to integrating and that holistic approach, do you see that the future of individual service providers like financial advisors, and have their service delivered efficiently to the customer?
13:31 – What are the biggest challenges that financial advisors face?
14:55 – Can you tell me more about the technology?
17:16 – How are you dealing with risks from cyber-attacks?
19:37 – Are you US focused?
21:54 – What are your general thoughts on the future for financial advisors?
22:50 – What are your favorite books?
25:50 – What would your one lesson to share for anyone wanting to start their own company?
Enjoy and thanks for the listen!