Generation 40s – 四十世代

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Why walking away from a successful career in finance is not so hard

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South China Morning Post
Comment›Insight & Opinion

Tan Chin Hwee

Tan Chin Hwee says set against the boom-and-bust cycle of the industry, material success is, in the end, only one part of a life well lived – which teaches loss and the importance of intellectual honesty

I always wanted to be in finance; I am drawn to the energy and intensity, but most of all the intellectual challenge. Managing money professionally is probably the best thing next to professional sports. The market is objective: it doesn’t care whether you have a PhD or a CFA, only three letters count – PnL, profit and loss.

As a college student, my rude introduction to finance almost ended up in bankruptcy as I speculated on options with no understanding of the Black-Scholes-Merton pricing model. Ironically, that episode was also how I managed to “sweet-talk” my way into my first job on the buy side in 1995 as the interviewers were impressed with my risk-taking abilities and intellectual curiosity.

Even so, I was still not adequately prepared for the 1997 Asian crisis as a young finance professional; my first credit default happened on my mother’s birthday in 1997. I will never forget that defining humbling experience.

From then on, I was determined to be the best in the industry in Asia. I began to devote my life to being a better investor. That included uprooting my young family and moving to be near New York, for four years, starting again from the bottom of the trading floor at a major global hedge fund.

Fast forward to 2015, one could argue that I have had a successful investment career, yet, I have always felt like I am a square peg in a round hole in the industry.

I have watched four economic crises ravage and cut short many careers in the financial industry over the past 21 years. The winner-takes-all mentality prevalent in the industry is a constant challenge to my upbringing. To be a successful financial executive, every part of you has to be devoted to success, but at what cost?

I grew up in a one-bedroom rented flat but I have never been attracted by the money in the industry. The money was very good but, overall, we are very much overpaid for what we actually do. Clearly, there are many positive attributes of being a finance professional. We work hard and provide for our families but at the same time, stress levels are high.

I remember telling myself, when I finally joined the best hedge fund industry in the early 2000s, that I would quit once I made “X” amount of money. Sadly, that mental goalpost kept shifting and I kept finding a reason to stay. But what is enough?

It was only the premature birth, and near death, of my daughter that prompted me to stop this meaningless rat race. And I began to set the ball in motion by investing in a new asset class: the next generation.

I devoted myself to teaching and mentoring young professionals and capping it with a book that indirectly documented my investment journey. I have also started doing pro bono advisory work for regulators as a small step to levelling the private-public playing field.

Ethics can be taught and I experimented by using financial education to influence the next generation. The masters classes I taught at Shanghai Jiao Tong University over the past few years were particularly memorable as the Chinese students opened their minds, and more importantly their hearts, to my ideals that making money alone is not, and cannot be, the only end goal.

Finally, the day of reckoning has come, 21 years on, to call it quits. My long-suffering wife, who has seen first-hand many a career go bust, will be the most relieved. From my teachers and mentors, I have learnt so much – in particular about the value of intellectual curiosity, intellectual honesty and intellectual independence.

Tan Chin Hwee, an institutional investor based in Singapore, is author of Asia Financial Statement Analysis: Detecting Financial Irregularities


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