JRT Partners’ Founder Tuck Meng Yee on Strategies for Investing through Times of Crisis
JRT Partners is a Singapore based single-family office that invests across multiple asset classes including real estate, alternatives such as private equity, hedge funds and venture capital, and mutual funds. On occasion, the family office works with other family offices in investing, as well as advising them on the establishment of a family office and administration, as well as investment due diligence services. Hubbis had the pleasure recently of meeting with Tuck Meng Yee, founder and partner of the firm he created back in 2015. We found a principal who has a deep understanding and connection to the world of investments, from mainstream to alternatives, from public to private, and who offered some ‘big picture’ thoughts to investors of all sizes and categories on how they might position themselves for the current and anticipated global economic and financial environment. Importantly, he is a major proponent of external and self-driven education, believing that the more investors understand about psychology, macroeconomics, about market volatility and about products – both mainstream and private or alternative - and about valuation and return theories, the better they will be prepared for the uncertainties that still lie ahead.
Tuck opens the conversation with the view that investor education should filter down to the retail levels, and not be the purview of the educated and wealthy investors only. He also believes it would be ideal if alternative investments, which he has seen through his career and personal investing can generate far superior returns to the public markets, should be more available to retail investors, although logistically he concedes that is not currently feasible.
“For most people, realistically,” he observes, “the only way they can actually aggressively build their wealth, from early on, unless they are lucky enough to be able to build a business or inherit themselves is through leverage into property. Unfortunately, most of them miss out on important opportunities in the world of venture capital and private equity.”
He offers an analogy to food and nutrition.
“The banks and other firms tend to offer what is on their menu, like a restaurant, whereas what is required is so often the nutritionist who can offer more holistic planning around the real needs of the individual.”
Improving the information flows
The plus side however is that self-directed research is so much easier today, although he also concedes that the minus to that plus is the risk of being drawn towards popular themes that make headlines rather than sustained or risk-free returns. “It is therefore essential to somehow help these investors regulate the quality of information,” he comments.
Tuck explains that aside from running the family office, he nowadays spends a considerable amount of time and effort on helping educate, offering his time for live or virtual lectures.
“I truly enjoy investing, and I enjoy learning, and I enjoy sharing knowledge,” he reports. “But it is also all about access as well as capital to invest, and whether the investor selects to use a private bank or perhaps co-invests alongside a friend or partner who might know certain markets or sectors, or whether you simply invest passively through ETFs or mutual funds, or possibly if you have the scale and access to buy into PE, VC or hedge funds, these are all avenues of access to select from. And of course, part of the decision process is how much time or interest you have in investing, or whether you really prefer to outsource it all.”
Finding the right partners
Tuck elaborates on this train of thought, commenting that the next step for those who wish to outsource their investing is to select which advisors to work with and that partly depends on the scale of funds available, especially if highly customised portfolio solutions are required. And then the decision needs to be made as to what to include in the portfolios, whether purely mainstream investments or a combination of all types including a variety of alternatives.
A world awash with liquidity
He observes that the current global financial situation is replete with risk, but masked by vast liquidity from printed money and therefore elevated valuations, as the money needs to find a home somewhere. “With rates so low or even negative, this is nearly a new universe in terms of how financial assets behave,” he says. “Which is why many private banking clients are into carry trades, borrowing cheap and investing in any asset that yields more than your cost of capital, or that offers growth potential, and then hoping they are sufficiently prudent not to suffer margin calls when there is more volatility.”
He cautions that long-term funding for long-term investing is reasonable in this scenario, but short-term funding for trading in assets with high volatility is a dangerous game. “Gamestop, anyone?” he quips.
Avoiding over exuberance
“With the global economy where it is and the pandemic ongoing, people act in a way that they don't normally act because they are being encouraged to take more risk when costs are close to zero. So, I believe people need to take a really close look at their portfolios and decide what they really want to keep, take profits on some portions and go for high conviction investments, and make sure you have time horizons to match.”
From his perspective, Tuck explains that he and colleagues canvass advisors to obtain a consensus view, listening to many views from different experts on different asset classes and markets, then deciding which views to support and which to ignore.
Sounding out and making decisions
“Remember,” he says, “that no one will have the right answer, or everyone could have the right answer, the issue is often really about timing and timelines in the mainstream public market, while staying invested and being selective. With private equity and venture capital, that however is a much longer horizon for investing and requires a different and more complex approach, as you will be locked into those investments for perhaps 7 to 15 years, in exchange for potentially higher returns for the right investments.”
Tuck mines down into some of his house views on themes, trends and markets to focus on, the first of which is the ongoing digital evolution, which has accelerated dramatically with the pandemic and is impacting key sectors such as the financial world, healthcare, biotech, MedTech, logistics, marketing, entertainment, cybersecurity.
“We can say so on and so forth,” he says, “as the impacts of the pandemic and digitisation are so dramatic. And then it is a case of finding themes you like, themes you see persisting ahead, and then finding investments and funds that match, that make sense given the dramatic changes taking place in the world and the way we work, in our social and family lives.”
He draws the discussion towards a close by observing that the pandemic has surprised him in showing how adaptable people can be. “We have seen so much of the world go into lockdown, and yet we still have a world that is relatively productive, and we can thank technology for that, and our adaptability for adjusting. I think the ability to work from home and to be agile is good as we strive towards a new work-life balance. It is a fascinating world we are now in.”
Getting Personal with Tuck Meng Yee
Tuck was born in Malaysia and educated in Switzerland and Australia. He attended the international school in Geneva and then high school and university in Australia. At the Australian National University, he obtained his BSc in Computer Science, then a BEc in Accounting and Economics, and then went on to the University of New South Wales for his Master's degree in Finance. He is also qualified to teach English as a foreign language to adults, holding a celta qualification.
He has amassed over 20 years’ experience in the financial markets in Asia and Australia in derivatives, and in fund and portfolio management, development, research and marketing with global investment banks (JPMorgan, UBS) and private banks (ABN Amro and Citibank) as well as funds services (Moore Management) and since 2015 his family office (JRT Partners), all giving him a keen sense of what investments suit which types of investors, and the support they typically need.
He also had a stint as Investment Solutions Head for Allfunds in Asia (a leading funds platform) in 2019 before returning to the family office JRT Partners in 2020. He also speaks English and Mandarin.
Tuck is single and to keep active is often out running, swimming or if travel is allowed snowboarding.
He is a believer in giving back to the community and does that currently by teaching pro-bono business courses to domestic helpers at an NGO.
“But I think the most rewarding thing for me, frankly, is giving back, whether it's giving talks to the CFA society on fund structuring, or teaching entrepreneurship to domestic helpers on Sundays,” he reports. “That’s the sort of stuff that I really enjoy, the teaching and sharing part.”
Tuck closes the conversation with a comment on how fortunate he has been to be able to work with some many excellent institutions and partners in the world of finance and wealth management.
“At JRT, I spend my time determining investment strategies and portfolio allocation, working with some of the leading advisors and specialist funds in the market. Combined with my experience working with some top banks around the world, I hope I have gained both the experience and judgement to manage through the inevitable crises that occur, as now. If I can also impart some of that collective knowledge and experience through education, that brings me great satisfaction. It is a privilege to give back and hopefully make a wider impact.”
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