Newsletter -  May 2015
 Issue #9

Directors:

President - 
Greg Filbeck, CFA,FRM,CAIA

Vice President- 
Craig Gomulka, CFA

Treasurer - 
Joe Lantz, CFA,CAIA

Special Events- 
Ryan Bend, CFA

Secretary-
George Emanuele,CFA

Programs & Media Relations- 
Chris Wiles, CFA

Membership Outreach - 
Cale Grove, CFA

University Outreach -
Manoharlal Sukhwani, CFA

Financial Literacy -
David Zawadski, CFA

Executive Administrator -
Caryn Loehr


Presidents Message:

 

Welcome to the ninth issue of the CFA Society of Pittsburgh's Newsletter.


 

In this newsletter, you will find a recap from our two May luncheons (Employment Trends in Finance - A Panel Discussion and Colonel Mateo Martemucci, U.S. Air Force, U.S. Cyber Security & Economic Threats).  We hope you are enjoying the interesting and highly diverse programs arranged by Board member and Program Chair Chris Wiles!

 

Cale Grove, our Membership Chair, will be distributing results from the compensation survey conducted last month.  A big thank you to all who participated in the survey!   

 

We have officially set a date of Monday, September 14th for our first-ever job fair for college students.  Please email me at [email protected] if your firm would be interested in participating and who the key contact would be for recruiting.  More information to follow.

 

In this newsletter, Chris outlines our program offerings for May and June.  We hope you will be able to take advantage of the many opportunities that await you with our society events!  A social event will be held at the Hard Rock Caf� on June 11th - look for details to follow!

 

The primary goals of the newsletter are to keep members and supporters of the Pittsburgh Society informed about the society's activities and foster greater community involvement by all members.

 

- Dr. Greg Filbeck, CFA, FRM, CAIA 

President, CFA Society Pittsburgh


 

Upcoming Events

"The Nature of Investing" Featuring Katherine Collins

Please join us in welcoming Katherine Collins, CFA to Pittsburgh on Wednesday, May 20th, 2015. Katherine Collins is Founder and CEO of Honeybee Capital, dedicated to pollinating ideas across varied fields in pursuit of optimal investment decision making.

Prior to founding Honeybee, Katherine served in numerous capacities at Fidelity Management and Research Company: as head of US Equity Research, she led one of the largest buy-side research operations in the world. As Portfolio Manager, she was solely responsible for investment decisions for the multi-billion dollar Fidelity America funds while based in London, and for the entire range of Fidelity Mid-Cap Funds while based in Boston. Every fund that Katherine managed at Fidelity outperformed its relevant benchmark during her tenure. As Analyst, she managed several different industry-specific Select funds and researched over a dozen different industries. She also spent two years at the Fidelity Foundations, acting as Program Officer for these large philanthropic organizations. 

After a long and successful career in traditional equity management, Katherine set out to reconnect her investment philosophy with the broader world, traveling as a pilgrim and volunteer, earning her MTS degree at Harvard Divinity School, and studying the natural world as guide for investing in a valuable and integrated way, beneficial to our communities and our planet.

Katherine's book, The Nature of Investing, was published in spring 2014 and she was recently featured in the CFA Institute Magazine feature article "The Herd and the Bees" (July/August 2014). Katherine is an alumna of Wellesley College and Harvard Divinity School, and holds a CFA designation.


 

To see a little of what Katherine will be talking about:

Honeybee Capital - Katherine Collins - Speaker Reel
Honeybee Capital - Katherine Collins - Speaker Reel


 

To join us in what should be a fascinating luncheon click HERE
3rd Annual Endowments & Foundations Conference

The CFA Society of Pittsburgh is pleased to host its 3rd Annual Endowments and Foundations Investments and Governance Conference on Thursday, May 21

 

Join leaders from Endowments and Foundations, investment consultants, money managers, and subject experts for this full-day educational conference covering today's critical investment and governance issues.

 

This year's conference will again include a mix of regional and national speakers from investment organizations and the Endowments and Foundations community, a keynote address by Michael Psaros, Co-founder and Managing Partner of KPS Capital Partners, and our CIO Roundtable will return by popular demand with a new cast of CIOs.



"U.S. Equity Sector Outlook"

On Wednesday, June 17, we will welcome Lance Stonecypher, CFA to Pittsburgh. Lance is Ned Davis Research Group's Chief U.S. Equity Sector Strategist   

 

Mr. Stonecypher joined the firm in 1986. He and his team have created several quantitatively based ranking systems for the U.S industries. Mr. Stonecypher and the sector team write the industry focus and industry comment, which provide insights on U.S. group and sector leadership trends based on macro, fundamental, valuation, quantitative, and technical analysis. He produces the sectors and industries section of the firm's monthly Investment Strategy publication. 

 

Mr. Stonecypher has held a number of other positions since joining the company, including Director of Research, Director of Custom Research Services, as well as the firm's research assistant in the development of hundreds of the firm's indicators and studies. He and the investment management team also quantitatively manage an equity pension portfolio using the firm's ranking systems and risk control techniques. 


 

Mr. Stonecypher has also been featured as a guest on CNBC and Bloomberg television in addition to being quoted by The Wall Street Journal, Barron's, Investor's Business Daily, and others. He is also featured in the popular book, Technically Speaking. 


 

Mr. Stonecypher is a CFA charter holder and a member of the CFA Institute as well as the Market Technician's Association. He is a magna cum laude graduate of the University of San Diego.
  

Please join us in what should be a very timely and informative presentation.


Highlights from Recent Events

Employment Trends in Finance - A Panel Discussion

On May 6th we had a very interesting panel discussion with two of our areas leading experts in the recruiting and hiring of CFA's, Karen Gigliotti - Vice President & Director of Employment at Federated Investors, and Tom O'Connor - President of O'Connor, O'Connor, Lordi, Ltd.

Both of our panelists believe that the CFA designation is gaining in importance and prestige. Historically CFA's were almost exclusively hired in investment research and portfolio management, and here in Pittsburgh most of the hiring was done at the larger banks and a large mutual fund company. But times are changing. CFA's are starting to be recognized and sought in other industries in Investor Relations, and Corporate Finance roles. CFA's are being sought for their stamina, intelligence, ethics and integrity.

Both speakers recommend that young graduates seek the CFA while working before getting their MBA. An MBA without industry experience is not as valuable as a CFA.

We also discussed the highlights of our CFA Society Pittsburgh Compensation Survey where we had 85 respondents:

- Over 60% of respondents work in Wealth Management or Asset Management (including Mutual Funds); a full 40% work in asset management / mutual funds!


 

- A large majority of respondents (2/3) have graduate degrees.


 

- There is a wide, wide range of compensation: Salaries ranged from $25K - $390K, and total compensation ranged from $25K - $2 million! Median salary was $127K and median total comp was $161K. Average salary was $138K and average total comp was $255K. Ten earned under $100,000 & four earned over $1 million.


 

- Our workforce in Pittsburgh is VERY experienced. Median years of experience was 18, and the average was 19. There were 16 with under 10 yrs. experience and 13 with over 30 yrs.


 

 - Most people (51/85) received some form of non-cash compensation. The most prevalent is profit sharing / retirement contributions, followed by Company Stock / Stock Options.


 

- Most folks are happy with their compensation. On our 7-point scale (7 is "Highly Satisfied with Compensation"), 54% were happy (scored 5-7).


 

More details from this survey will be posted on our website shortly.

Special Luncheon - Colonel Mateo Martemucci, U.S. Air Force, U.S. Cyber Security & Economic Threats

In 2011, when the list of threats to U.S. security was put together, the cyberthreat was not even mentioned. Today it is the number one threat to our nation.

On Wednesday, April 29, we had the privilege of listening to Colonel Matteo Martemucci, the commander of the Air Forces 318th Cyberspace Operations Group. After 21 years in military intelligence Col. Martemucci will be moving to Washington this summer to join the Joint Chiefs of Staff. He is one of our nations leading experts on cybersecurity, and cyber-warfare from both a defensive and offensive perspective.

His presentation was knowledgeable and eyeopening, but very disconcerting as well. First, everything with an IP address is at risk, from your home security system, to your car and phone, to the company you work for, to the financial institutions you bank with. There are various levels of vulnerability, but everything is vulnerable to a certain degree. Smart phones are vulnerable phones, smart grids are vulnerable grids, and smart banking is vulnerable banking.

Who are these bad actors?
  • Nation States - China & Russia in espionage and theft of intellectual property. As well as North Korea & Iran in outright theft and disruption.
  • Non-Government - Terrorists like ISIS, and International criminals like the RBN (Russian Business Network).
  • Individuals - Hacktivists pushing a particular political agenda, or thieves looking to extort or steal money.
He reminded us of an attack last year on Las Vegas Sands, where several of their casinos were partially shutdown as their computer hard drives were erased. We recently found out that this attack was carried out by Iran, in retaliation for the Sands CEO, Sheldon Adelson's outspoken support of Israel. An attack on a corporation because of a CEO's political views.

When do attacks like this, and the one on Sony rise to the level of Cyberwar? When does the U.S. government step in to protect/retaliate against these bad actors? We are currently losing $400 billion a year to economic espionage...at what level is enough enough? These are the tough questions that need to be answered. Today when you find that your Visa was hacked, you simply call your bank and they issue you a new card while eating the loss. When does the bank and Visa say enough, we want the government to protect us?

Col. Martemucci drew an interesting analogy between today's cyber-piracy and the real piracy of the Barbary Wars. In the late 1700's early 1800's pirates in the Mediterranean would capture ships and hold them for ransom. The wealthy european countries would pay the ransom, but the U.S. struggled with this idea. Even though he was opposed to the government getting involved militarily in the affairs of commerce, President Jefferson eventually acquiesced and led the first war against these pirates in 1801. Today we are faced with a similar question, what is the governments role in protecting commerce on the "high seas" of cyberspace?

The biggest problem today is not necessarily a technology problem, it is a process problem. The Department of Defense protects .mil, the FBI protects .gov, but who protects .com, .org, .net, and .edu? We simply don't have processes in place to protect civilians and corporations while balancing civil liberties. 

Unfortunately the advantage always goes to the attacker, since the bureaucracy inherent in governments will be a constant impediment. Col. Martemucci would like to see a private, as opposed to a government solution, and is encouraged with several of their joint private/military collaborations. But for now, the attacks on our corporations and economy will continue until there is a "principled American outrage."

Annual Partner Sponsors

CFA Society Pittsburgh would like to thank its partnership sponsors for their support of the Society.


 

Gold

 


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