My Worst Investment Ever Podcast Jay Pelosky – You Can Be Right but at the Wrong Time
BIO: Jay Pelosky has over 35 years of both buy and sell side financial market experience. While at Morgan Stanley, he was ranked # 1 in Institutional Investor in Global Equity Strategy and Global Asset Allocation Strategy.
STORY: In the 90s, Jay was bullish about Mexico even though people were concerned about foreign currency debt and the country’s risk of devaluation. He remained adamant that people shouldn’t worry because Mexico wouldn’t devalue, and everything would be fine. Lo and behold, the Mexican government devalued in the middle of the night.
LEARNING: You can be right but at the wrong time. A forward-thinking approach is precious as an investor. You must have a thick skin to be an investor because you’ll get stuff wrong often.
“The only person who hasn’t struck out is the person who hasn’t swung the bat. In other words, if you’re going to be in this business, you’re going to make mistakes.”
Jay Pelosky
Guest profile
Jay Pelosky has over 35 years of both buy and sell side financial market experience. While at Morgan Stanley, he was ranked # 1 in Institutional Investor in Global Equity Strategy and Global Asset Allocation Strategy. He has over 20 years of global macro experience and has spent much of the past 20 years investing his own capital using US-listed ETFs.
TPW Advisory is a NYC-based, independent investment boutique offering global asset allocation and portfolio strategy advice to retail and institutional investors through its Model Portfolio Delivery Service (MPDS). Learn more at pelosky.com.
Worst investment ever
In the 1990s, Jay was the Latin American strategist at Morgan Stanley Asset Management and the research department head. He had hired many people and did a lot of IPO business because of the emerging market enthusiasm. Many S&P investors were peeling off 5% or 10% of their exposure and putting it in emerging markets to juice their returns relative to the S&P.
Jay was bullish about Mexico even though people were concerned about foreign currency debt and the country’s devaluation risk. He remained adamant that people shouldn’t worry because Mexico wouldn’t devalue, and everything would be fine. He encouraged people to stay invested.
Lo and behold, the Mexican government devalued in the middle of the night. Jay had to go in front of the sales force, admit that he had gotten it wrong, and articulate how he got it wrong. He became the poster child in the Wall Street Journal for how Wall Street got Mexico wrong.
Lessons learned
- You must have a thick skin to be an investor because you’ll get stuff wrong often.
- Learn to handle being wrong publicly, shake it off, and understand where you went wrong.
- A forward-thinking approach is precious as an investor.
Andrew’s takeaways
- You can be right but at the wrong time.
- If you’re taking risks, you’re definitely going to lose. Even the best people fail; it’s just part of the game.
Actionable advice
Talk with someone with more experience to give you an honest read on what their bullish view is. Ask them to help you identify some of the risks.
Jay’s recommendations
If you want to get into the business of Wall Street or invest in the capital markets, Jay recommends establishing your own portfolio. By showing that you’re willing to bet on yourself, you’ll go a long way toward encouraging others to bet on you.
No.1 goal for the next 12 months
Jay’s number one goal for the next 12 months is to have a good portfolio performance and continue to identify opportunities, avoid market pitfalls, and provide excellent service to his clients.
Parting words
“It’s been a great discussion. I appreciate your questions and the opportunity to tell some of my stories. It’s always fun.”
Jay Pelosky
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Connect with Jay Pelosky
Andrew’s books
- How to Start Building Your Wealth Investing in the Stock Market
- My Worst Investment Ever
- 9 Valuation Mistakes and How to Avoid Them
- Transform Your Business with Dr.Deming’s 14 Points
Andrew’s online programs
- Valuation Master Class
- The Become a Better Investor Community
- How to Start Building Your Wealth Investing in the Stock Market
- Finance Made Ridiculously Simple
- FVMR Investing: Quantamental Investing Across the World
- Become a Great Presenter and Increase Your Influence
- Transform Your Business with Dr. Deming’s 14 Points
- Achieve Your Goals