Stuart Millar, CFA

Chief Investment Officer Smartshares Ltd
NZX Limited

What are some of your career highlights so far?
Arriving in London in 1996 without a dime in my pocket and landing a job on the trading floor at major investment bank was a real boost to my enthusiasm for capital markets and what makes them tick. It was so exciting – that is until half the floor was cleared out after significant losses on Russian bonds. I gained my first lessons in liquidity (or lack of) having invested most of my savings in property while my trading colleagues made fortunes out of punting tech stocks. By the end of 2001 we were all squared up and I still had my property and they had none. Dot com taught me a lot about resilience and belief in your philosophy and process. It is tempting to flock to the latest and greatest but diversification has to be the easiest and cheapest way to manage risk. I asked the question once about the lack of diversification in a CDO fund of funds and told I didn’t know what I was talking about – apparently there would have to be a “global financial crisis” for investors to lose money. I’ll never forget the day when a major bank refused to sell me any more currency options – their losses were just too big. Multi-asset funds were a good place to be in 2007 and with the timely introduction of KiwiSaver this is where the money flowed into over the next decade. I am proud to be part of the growth in what became the largest fund manager in the country and through that time was honoured to work with some really talented people.

What do you like most about your job/industry?
The markets never sleep and there is always so much to learn. I love to trade and add value but also recognise that the market often knows more than me. My new role at the NZX is really challenging and the opportunity in front of me is exciting. Smartshares is a fast growing business and there is so much I can do to improve investment processes and reduce operational risk. Investors around the world are rapidly adopting ETFs as the core building blocks for their portfolios and NZ seems to be slow on the uptake. ETFs are a really efficient way to gain exposure to various markets in one trade. As a multi-asset portfolio manager I can’t help but agree with Nobel laureate economist Paul Samuelson that stock markets are “micro efficient”, but “macro inefficient”.

What are your interests outside work?
I am a surfer first and foremost but love my fishing too. I have lived at Piha with my wife Carolyn and two daughters Leia and Portia who all surf too. When the wind changes direction you will find us on the east coast chasing waves and fish around Whangamata. More recently I have been traveling the country most weekends supporting my eldest daughters pro-surfing aspirations – it’s a tough job.

Make a prediction for 2024
The US will still be negotiating a trade agreement with China. The coronavirus won’t have gone away. Climate change will be even more of an issue – we must invest responsibly. However, the markets will have become accustomed to some of these concerns. I have no doubt there will be something else that bothers the markets between now and then but on average the returns on global equities will be reasonable. Better than bonds anyway.


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