The VentureCation Financial Series: Jay Jacobs, Global X Funds

In this VentureCation Financial Series, I interview some of the leading finance experts out there.

I ask them several questions that can help every investor, at any level, improve his methods, knowledge, and ultimately, his ability to be more efficient with their investing.

This week I have the pleasure to interview Jay Jacobs, Global X Funds’ head of Research & Product Development. Follow him on Twitter @GlobalXFunds .

 

About Jay: 

Having joined Global X in 2013, Jay leads the firm’s research team, which originates the firm’s unique insights on the markets and ETFs. He also guides the planning and development of the firm’s strategic direction. Jay is a frequently cited expert in the financial media, including CNBC, Bloomberg, and The Wall Street Journal.

Before joining Global X, Jay was a business analyst at the New York Stock Exchange (NYSE) in the ETF and Indexing Group, where he helped to launch hundreds of ETFs on the NYSE Arca trading platform.

Jay holds a B.A. from Emory University in International Studies and an MBA from Columbia Business School. He is also a CFA charterholder.

 

Q: What investing advice do you give out the most?

• Its often said that diversification is the only free lunch in finance, but I think a corollary to that is that a long time horizon is the greatest asset an investor can have. With a long time horizon and a disciplined approach to remaining invested in the proper asset allocation, reinvesting dividends, and dollar-cost averaging new savings, investors can achieve remarkable returns.

 

Q: What are some long-term ETFs that you recommend looking into?

• Broadly speaking, we believe thematic investing is an excellent approach for long-term investors given that it seeks to benefit from structural changes that are occurring across the economy over from the next five years to several decades. This can include themes like robotics & artificial intelligence, blockchain, U.S. infrastructure development, lithium & battery tech, and more.

 

Q: Individual stock selection or Index Fund investing, what do you prefer?

• We believe in targeted rules-based approaches that can provide well-specified exposure to specific themes and strategies, with the transparency and low costs of index-based approaches.

 

Q: How can people optimize their personal finance?

• There are several methods, but its starts with making sure you are regularly saving and investing those savings in a diversified portfolio that matches your investment objectives.

 

Q: What do you think about the latest “Wall Street Bets” involvement in the stock market?

• I cannot comment specifically on Wall Street Bet’s impact on the markets, but more broadly, we have seen a massive increase in retail investors in the markets. This is partly due to the increase in household savings during the pandemic, as well as the markets providing a recent combination of strong returns and even entertainment amid the limitations of the COVID-19 outbreak. Overall, greater participation in the markets is an excellent development as we believe over the long run investing is an excellent source of wealth creation. However, investors will want to make sure they are investing responsibly within appropriate risk limits based on their financial objectives.

 

Q: What is your favorite book about finance?

• I thoroughly enjoyed Red Notice by Bill Browder as it shows to an absolute extreme both the risks and rewards of uncovering investment opportunities that the broader markets have not caught up with.

 

Q: What are your thoughts on investing in V.C. funds?

• In many ways, our focus on thematic investing is aligned with V.C. funds. We are looking to capitalize on being early to powerful trends and the high growth potential companies leading in those trends. V.C. can look to earlier-stage companies and themes, whereas our ETFs are looking at more established themes that have a greater presence in the public equity markets. For investors with the ability to access V.C. investments, thematic investing through ETFs could serve as a great complement so that they get full lifecycle to exposure to a theme from private to public markets.