Finology Summit 2023 - Program & Faculty

Finology Summit 2023 will help grow your knowledge and understanding of the “human factors” – beliefs, behaviours and principles – that influence portfolio construction, to help you build better quality investor portfolios.

Established in 2016, Finology Summit is the behavioural finance and investment philosophy program of the year. The focus of this year’s program is “Uncertainty”. Certainty shapes human behaviour. The more certain we are in our beliefs, the more they drive our actions. In contrast, uncertainty can cause anxiety and distress, diminishing our ability to identify opportunities and make rational, good quality decisions. For portfolio construction practitioners, who must build multi-asset portfolios in a volatile, uncertain, complex and ambiguous (VUCA) World, coping with uncertainty is integral to building better quality portfolios. A whole-brain approach to portfolio construction, reflecting knowledge and skill in both the Investment Factors (markets, strategies and investing) and the Human Factors – beliefs, behaviours and principles - is key.

Finology Summit focuses on the Human Factors that influence portfolio construction, to help you better deal with uncertainty and build better quality investor portfolios.

We’d welcome you joining us - at our live studio in Sydney, at a live site around Australia and NZ, or via live stream from your desk.   Register now!

Graham Rich
Dean, Portfolio Construction Forum

A quick introduction   Theme;  Scene Setter - to come

Prep  Prep to do before the day;

Program  Program at a glance;

More info & to register  Where; When; Aim; Most suited to; CE/CPD accreditation; Cost; Theme; Register now

Established in 2016, Finology Summit is the behavioural finance and investment philosophy program of the year. Designed and curated by our specialist, experienced and independent team, the program features an exceptional Faculty of experts from around the world, each offering a high conviction perspective on a facet of the “human factors” - beliefs, behaviours and principles - that influence portfolio construction.

Theme:  Uncertainty - exploring the human factors in portfolio construction

Finology Summit 2023 will help grow your knowledge and understanding of the “human factors” – beliefs, behaviours and principles – that influence portfolio construction, to help you build better quality investor portfolios.

The focus of this year’s program is “Uncertainty”. Certainty shapes human behaviour. The more certain we are in our beliefs, the more they drive our actions. In contrast, uncertainty can cause anxiety and distress, diminishing our ability to identify opportunities and make rational, good quality decisions. For portfolio construction practitioners, who must build multi-asset portfolios in a volatile, uncertain, complex and ambiguous (VUCA) World, coping with uncertainty is integral to building better quality portfolios. A whole-brain approach to portfolio construction, reflecting knowledge and skill in both the Investment Factors (markets, strategies and investing) and the Human Factors – beliefs, behaviours and principles - is key.

Finology Summit focuses on the Human Factors that influence portfolio construction, to help you better deal with uncertainty and build better quality investor portfolios.

To maximise your learning, you are provided with prep - some videos and readings - aimed at refreshing your memory, boosting your knowledge, and getting you thinking about the issues to be addressed in the program. The preparation is assumed prior knowledge.

Read:  Finology Summit 2023 - scene setter by the Forum - to come
Complete:  Finology Benchmarking Indices self assessment - Practitioners only
Read:  The behavioural alpha benchmark by Essentia Analytics
Read:  The Alpha Lifecycle, Journal of Investing
Read:  New life, old life by Fidelity International
Watch:  Finology Summit 2021 key takeouts

Wednesday 03 May 2023

 
AEST 8.00am - Live stream starts

 
AEST 8.10am - Pre-opening scene-setter

 
AEST 8.30am - Critical Issues Forum

Uncertainty - Exploring human factors in portfolio construction
Certainty shapes human behaviour. The more certain we are in our beliefs, the more they drive our actions. In contrast, uncertainty can cause anxiety and distress, diminishing our ability to identify opportunities and make rational, good quality decisions. For portfolio construction practitioners, who must build multi-asset portfolios in a volatile, uncertain, complex and ambiguous (VUCA) World, coping with uncertainty is integral to building better quality portfolios. A whole-brain approach to portfolio construction, reflecting knowledge and skill in both the Investment Factors (markets, strategies and investing) and the Human Factors – beliefs, behaviours and principles - is key. Finology Summit focuses on the Human Factors that influence portfolio construction, to help you better deal with uncertainty and build better quality investor portfolios.
- Graham Rich, Dean, Portfolio Construction Forum

 
AEST 8.35am - Critical Issues Forum

I believe our brains can beat uncertainty   Watch on-demand
As the world gets increasingly complex and uncertain, creating a sense of confidence in a sea of confusion is key to success. By taking three tools of persuasion – act, think big and simplify – and turning them on ourselves, we can create a sense of certainty, even when who knows what is just around the corner.
- Adam Ferrier, Founder & Consumer Psychologist, Thinkerbell (Melbourne)

 
AEST 9.15am - Critical Issues Forum

Analysing decisions not results is essential for better alpha   Watch on-demand
It stands to reason that an investor who makes profitable (relative or absolute) decisions more than 50% of the time, and whose profitable decisions typically add more value than their unprofitable ones destroy, will outperform an investor who does not. Decision attribution analysis provides a crucial lens on equity manager skill, benefiting asset owners and fund buyers as they select and monitor managers. In addition, fund managers increasingly use such analysis to identify and overcome their own behavioural biases, producing better outcomes for investors.
- Clare Flynn Levy, Founder & CEO, Essentia Analytics (New York)

 
AEST 10.00am - Critical Issues Forum

Portfolio construction demands a whole brain approach   Watch on-demand
The essential idea of the whole brain approach is that high levels of competence in most practical disciplines require that “hard” skills are balanced with “soft” skills, including more general types of knowledge and abilities such as systems thinking, “historical thinking,” ethical thinking, and self-awareness. This is particularly true in the complex and dynamic world of portfolio construction, where there exist multiple “schools of thought” for understanding markets and constructing portfolios, as well as a range of social and situational dynamics that shape real-world practice. In the absence of an unambiguous “right” way to think through or make decisions in all situations, a whole brain approach advocates for flexible engagement with different perspectives, frameworks, and types of thinking in pursuit of more informed and adaptive judgement and decision-making in portfolio construction practice.
- Rob Hamshar, Principal - Finology Research, Investment Management Research Program, Portfolio Construction Forum (Virginia)

 
AEST 10.10am - Critical Issues Forum

I believe behavioural alpha is the most sustainable   Watch on-demand
Investors today have more knowledge than any prior generation, however there remains a chasm between knowing and doing. Our behavioural biases hold us back. Thanks to 50 years of research, we also know in theory how to control our biases. Yet still we fail. No matter how much economies, markets and technologies change, human biases and the difficulty overcoming them remain. Acknowledging we are all biased, because we are all human, is the first step to better decisions. Being mindful of uncertainty, over-confidence, incorrect beliefs, unchecked errors, and the personal risk we face when trying to differ from the crowd are just a few of many steps we can take on the path to more sustainable behavioural alpha.
- David Wanis, CFA, Founding Partner, Chief Investment Officer & Portfolio Manager, Longwave Capital (Sydney)

 
AEST 10.40am - Morning Break

 
AEST 10.57 - On the move

 
AEST 11.05am - Special Interests Forum 1 - choice of concurrent sessions:

1.  I believe ESG should be banned   Watch on-demand
ESG is no longer enjoying its honeymoon. ESG strategies – whatever that means – have underperformed in 2022 and ESG investment is coming under increasing criticism from politicians, regulators, investors and even practitioners. Some of this criticism is valid but at the heart of the problem is uncertainty arising from the widespread use of an acronym with no – or rather many - common meanings. It is right to question ESG practices, but they have merit and will continue to be increasingly important to investors and by extension, the investments and wealth industry. The real problem is the ill-defined use of the acronym itself and we will all be better off if we stop using it.
- Tom King, OAM, Chief Investment Officer, Nanuk Asset Management (Brisbane)

2.  I believe every balanced portfolio should include CRE Debt   Watch on-demand
Traditionally, investors’ access to Commercial Real Estate (CRE) Debt has been limited. However, the rapidly growing activities of Non-bank Lenders (NBLs) have enabled private investors to access this $400bn asset class, offering a broader range of investment philosophies and generating institutional grade investment opportunities. CRE Debt provides dependable returns, backed by real property first mortgages – a risk-adjusted return basis, every balanced portfolio should include an allocation into CRE Debt.
- Patrick Keenan, Executive Chairman, Pallas Capital (Sydney)

 
AEST 11.45am - On the move

 
AEST 11.50am - Special Interests Forum 2 - choice of concurrent sessions:

1.  I believe in a portfolio tailored for the energy transition   Watch on-demand
The energy transition represents the greatest economic opportunity since the industrial revolution from 1760 to 1840. Reliably capturing the potential of this opportunity and delivering tangible environmental impact will require investors to assume a posture shaped by three core beliefs: that their legacy ought to be a net-zero world, not just a net-zero portfolio; that they should seek economic leverage, rather than exposure, to the energy transition; and, that they should pursue value accretion in their portfolio rather than growth.
- David Costello, CFA, Portfolio Manager, Magellan Financial Group (Sydney)

2.   I believe private equity is a must have in portfolios   Watch on-demand
Alternatives should be in every diversified portfolio. Private Equity delivers unmistakable benefits and growth potential, especially in uncertain markets. Unlisted assets, with their proven long-term performance, provide access to a bigger opportunity set that reflects active management in its truest form. Investment into private markets gives managers greater control and influence to transform underperforming businesses. Possibly also influenced by market uncertainty, many businesses are staying private for longer, opening great opportunity for investment managers to continue to diversify their multi asset portfolios with rich investments across many diverse industries.
- Dan Farmer, Chief Investment Officer, Insignia Financial (Melbourne)

 
AEST 12.30pm - Lunch Break

 
AEST 1.00pm - Critical Issues Forum

I believe lifetime income better delivers what clients want   Watch on-demand
In research undertaken in partnership with National Seniors Australia, Australian seniors told us that they were feeling the impact of inflation on their lifestyle in retirement. They were concerned about the cost of living and outliving their savings. They want regular income, income that increases with the cost of living, income that lasts a lifetime and access to capital when required. I believe that a partial allocation of retirement savings to a contemporary lifetime income stream can help increase the certainty of delivering what clients want. Such an allocation can deliver more income and with increased certainty. And, contrary to common opinion, such an allocation can help clients preserve assets.
- Andrew Lowe, Head of Technical Services, Challenger (Sydney)

 
AEST 1.40pm - Critical Issues Forum

I believe in building justified trust   Watch on-demand
All relationships are built on trust, which requires integrity, competence and doing the right thing. But to earn justified trust from clients and deliver consistently good outcomes for them, year after year, requires practices and procedures that go beyond compliance obligations to globally recognised fiduciary standards of care.
- Aaron Drew, AIFA, Managing Director, MyFiduciary (Auckland)

 
AEST 2.05pm - Critical Issues Forum

I believe people-centric investors handle uncertainty better   Watch on-demand
The best investment opportunities exploit uncertainty. These are found by exploring setbacks and change. However, conventional investment training is number-centric, while I argue investing is all about people. Investors must understand companies and their customers and competitors, the motivations of other investors and, importantly, themselves. Empathy is key, yet industry convention emphasises modelling skills and cultivates auras of certainty. To better develop the skills required to analyse corporates, one can start with individuals as case studies and scale from there. If analysts can’t do that, it’s unlikely they can address more complex situations.
- Douglas Isles, FIA, Head of Investment, Platinum Asset Management (Sydney)

 
AEST 2.30pm - Critical Issues Forum

Investors should listen to their gut feelings when taking risk…   Watch on-demand
… though not unconditionally. Behavioural scientists have long embraced the view that emotions are not only unnecessary but disruptive. Yet the nascent field of Neurofinance, which studies how the brain perceives and reacts to financial risks, suggests that emotion is central to rational decision-making, and investors attuned to their emotions can make better decisions during critical market events. At the same time, ‘too much’ emotion can lead to financial mistakes caused by panic and irrational exuberance. The challenge, therefore, is for investors to learn how to be attuned to their emotional brain without being overwhelmed by it.
- Elise Payzan-Le Nestour, PhD, Scientia Fellow & Associate Professor, UNSW Business School (Sydney)

 
AEST 3.10pm - Afternoon Break

 
AEST 3.30pm - Critical Issues Forum

I believe in certainty in retirement
This session features two experts, each offering and debating a high conviction thesis.

• I believe certainty of income leads to confidence   Watch on-demand
  Constructing a retirement portfolio can be complex – how important is it to maximise the client’s retirement income while managing the risks to the sustainability of their income and the need for flexibility as their circumstances change? The future is now and the ability to create certainty and confidence via easy access to new and innovative retirement solutions will be critical. I believe retirement strategies must adapt in line with markets and demographics trends and the additional risks that are relevant for investors in decumulation. Retirement income products of the future must be relevant to an ageing population that is living longer and who need certainty and confidence.
  - Mark Lapedus, FIAA, Head of Product, Allianz Retire+ (Sydney)

• I believe that having a Plan B is more important than Plan A   Watch on-demand
  As Australians approach retirement, there can often be a sense of trepidation about what lies ahead. And, for a significant proportion of Australians, retirement comes unexpectedly early - this can be a cause of considerable angst. Our research shows that those who plan ahead, who expect the unexpected, retain a greater sense of control and have much less of an emotional rollercoaster as they move through their retirement journey. We can help retirees build and retain their sense of control by keeping on building trust and educating clients, modelling possible outcomes and demonstrating a planned approach – and providing a Plan B.
  - Richard Dinham, FIA, Head of Client Solutions and Retirement, Fidelity International (Sydney)

AEST 4.40pm - Critical Issues Forum

A good spending plan is essential for a good financial plan   Watch on-demand
One of the main goals of investing is to provide for income in retirement – spending! A critical part of any retirement plan is a spending plan (which is not the same as a budget!), that sets out how much money can be safely spent each year, and how this amount may vary depending on changing circumstances and changing market returns. Ultimately, a good spending plan helps keep clients’ investments on track.
- Tim Farrelly, Principal, farrelly’s Investment Strategy (Sydney)

AEST 5.00pm - Critical Issues Forum

Behavioural ethics are not just for ‘bad’ people
When we think about unethical behaviour, we imagine it’s perpetrated by bad people – but that’s not the case. Behavioural ethics recognises that good people can sometimes make bad ethical choices. The typical carrot-and-stick approach to ethics assumes that people faced with ethical dilemmas conduct a conscious, deliberate, cost-benefit analysis before making decisions. Yet, the behavioural sciences have shown us that our decision-making is often non-conscious and automatic. Insights from the behavioural sciences can help us adhere to our stated ethical principles.
- Herman Brodie, Founder, Prospecta (Birmingham)

This was a “you had to be there” session. This lecture is available as part of the Behavioural Finance - Investment Decision-Making course. For more information, click here.

 
AEST 5.45pm - Finology Summit 2023 ends

 
AEST 5.45pm - Finology Summit 2023 Networking Drinks (live studio)

Join us for a relaxed catch up with your fellow delegates (ending 6.45pm).