Any sound investment strategy must include both a tactical and a structural component. The tactical side requires close attention to the firm’s financials and prospects, while the structural side puts that analysis in the specific context of the industry as well as the economy at large. Our guest, Anna Nikolayevsky, is here today to share her approach and how her investment strategy has evolved.

Anna Nikolayevsky is the founder and Chief Investment Officer of Axel Capital Management, a fundamentally driven long/short firm investing in equities across a variety of sectors and geographies. Before founding Axel Capital in 2002, Anna was an analyst at Zweig-DiMenna Associates and Goldman Sachs Asset Management. Anna holds a BS from NYU, an MBA from Columbia Business School, and has also received multiple accolades for her investment work, including being the recipient of the Investors Choice Awards for Emerging Fund of 2015. She is a wonderful friend of the Centre and I'm incredibly thankful for all she does here for us at the Business School.

On this episode, Anna and I discuss how her humble childhood ultimately impacted her career choice, starting in the world of trading as a freshman, her rich learning opportunities early in her career, what it was like to start her firm in the early 2000s, why she decided to depart from the traditional hedge fund model, her thoughts on the future of value investing, and so much more!

Key Topics:

How Anna’s childhood influenced her career (3:08)
Anna’s transformative experience at Stuyvesant High School (5:17)
Anna’s start in the world of trading (6:43)
Why Anna decided to apply to Columbia Business School (8:14)
Insights from working for Mario Gabelli (9:09)
Establishing a foundation of independent thought (11:07)
Learning opportunities as an analyst at Goldman Sachs (12:32)
Why Anna made the move to a hedge fund (15:16)
The starting point for Axel Capital Management (16:29)
Axel Capital’s post-bubble success (18:38)
Rethinking the traditional hedge fund model (19:48)
The issues Anna identified in the housing market leading up to the global economic crisis (21:33)
Finding an alternative to the housing market (23:33)
How to think about your search strategy (25:19)
Timing and risk management of shorts (26:47)
Anna’s approach to risk management (27:56)
Thinking about fiscal policy and portfolio construction (29:12)
Axel Capital’s portfolio positioning during the ups and downs of the market since 2018 (30:57)
The wider effect of highly available capital (33:01)
How the pandemic has impacted Axel Capital’s portfolio structure (34:30)
Planning your approach to structural shocks (36:45)
Why Anna is comfortable with a relatively concentrated portfolio (38:46)
Axel Capital’s approach to industry analysis (40:09)
Decentralization away from Wall Street (41:31)
The democratization of trading (43:03)
My thoughts on the long-term impact of the increase in retail investors (44:03)
And much more!

Thanks for Listening!

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