Confessions of a Cat-holic (194)

I handpicked Intel, Ford and Delta Airline; two of which were no longer in operation; yes, they both went bankrupt. That was how good I was in stock picking.

I had since become the 股市明燈; I spent a lot of time reading about the stock market before I began my internship, with the help of books like 笑傲股市, the psychology of trading, the intelligent investor and the interpretation of financial statements by Warren Buffet, security analysis by Benjamin Graham and of course, the great crash of 1929 (I was all in for a bear market), to conclude that the erratic nature of stock movements was hugely arbitrary.

Lehman asked us to fill in a lot of paperwork in terms of the stocks we owned. At least then, Lehman knew better how bad a stock investor I had been, given the track records of my stock portfolio. I was so risk averse in investing that I never bought any stocks ever since, which also might explain why I could only work in fixed income sales. The firm conducted such background checks to avoid any insider trading. That was another thing I liked about sales and trading; everything was transparent and traded publicly over the counter with no pre-IPO or private placements. I didn't want to get involved with the shady business deals associated over the Chinese wall.

Oh, except that one time, my friend Dominic Lee told me to buy a stock he recommended based on his insider tips. I told you that was how Asia worked. Dominic probably thought that he was smart in inducing a loss on my portfolio when my friend from La Salle, Gary Choy, told me to go bullish on Hang Seng Index after Lehman's bankruptcy. I lost quite a bit of money there. I would not say Dominic was my friend. He was more of an acquaintance of mine but I thanked him for his kind heart. Dominic was pivotal in helping me successfully get into all the Ivy League colleges. My English was still mediocre in high school; I walked into my SAT exams without any revision and so I did terribly. I could not afford a Princeton Review or Kaplan crammer course, which cost around 10,000 HKD at the time. It was astronomical for a student like me. But Dominic was very helpful; he sat down with me in my dorm and taught me all the tricks and techniques he learned in the crash course, so my writing score was up from 480 to 650. Thank you, Dominic Lee.

Bond trading was less active during the day, especially in Asia. They said they needed quantitative people for fixed income too, so that should work for me with an engineering degree from Columbia. A lot of people didn't realize that no matter how the bond prices fluctuated, it wouldn't concern the investors anyways unless prepayments occurred. If the investors held it all the way til maturity, any price movements in the market should not matter to the bond holder, unless he needed to cash out by selling short. That was why when price went up, yield would go down; when price went down, yield would go up. Bond market was hugely affected by macroeconomy, interest rates and inflation, while equities concerned micro finance, such as the profiles and management of a public company. Lehman was known to be a bond house, with subpar performances in banking against competitors like Goldman or Lazard the boutique investment firm. Obviously, Lehman was the right choice for me if I wanted to work in fixed income. I met Joyce Lo in a resume workshop on campus; she was probably the key person that reaffirmed my decision in joining the firm. I wanted a role like hers, working in the front office as an analyst for the first few years, then moving on to a support role like HR with a marketing and finance degree from MIT as a woman engineer.

Out of all the financial institutions, I was particularly drawn to insurance and mutual funds for their investment styles even though the common perception was that they lived on commission and cold calls. An administrative or support role at firms like mass mutual, Franklin Templeton funds, or state street asset management would do.