STOX KIDS BOND WITH PUTNAM
The financial whiz kids of the Herald’s StoxSmart program got a crash course in money management last week as Boston’s Putnam Investments opened its doors and offered one-on-one insights about stock and bond picking.
After touring Putnam’s fixedincome trading room floor, where veterans and recent hires select bonds and manage investment portfolios, the students were encouraged to probe deeper into companies by analyzing earnings reports and information from firms’ websites, and to stay positive, even if their stock picks don’t perform up to expectations.
“My boss always says when we walk out of the door, ‘ You look left and you look right. You’re looking at colleagues, partners and collaborators. You’re not looking at competitors,’ ” said Aaron Cooper, Putnam’s director of equity research. “That’s really important. You realize you’re all in it together.”
Rich Tibbetts, Putnam’s chief of human resources, added that key themes of investment trading and stock picking are communication and articulation of written and verbal thoughts.
Putnam, which is celebrating its 75th anniversary, has 10 offices around the globe, a staff of 1,700 and it manages more than $132 billion in client portfolios.
“What we do is a very serious thing. The quality of our work, our ability to invest and take care of people’s money in a prudent way is something that is going to have an impact, either positive or negative on people’s lives,” Tibbetts said.
While showcasing Putnam’s busy fixed-income trading room, Paul Scanlon, co-head of fixedincome investment management, said the firm seeks out competitive, dynamic, energetic and smart people to manage money, even if their college majors aren’t in business or economics.
Cooper added that majors such as history and psychology could go a long way in terms of picking stocks.
“Our strong view is that anybody can be successful in the industry,” he said.
Cooper, who oversees about 40 analysts globally in three Putnam locations, described how sector teams work with fund managers to communicate their best and worst ideas about stocks in “shallow” and “deeper dive” meeting sessions about company funds.
The Putnam pros encouraged the StoxSmart students to look at their stock portfolios on three levels by asking: if an industry is favorable or not for a company; how the company is positioned within an industry; and about the company’s valuation.
The second class of StoxSmart students will compete until the end of the first quarter and have two more chances to reshuffle their portfolios.
Josiah Quincy Upper High School senior Norman Britt, 17, a member of The Cliff Divers team, led by Herald Business Editor Frank Quaratiello, said the experience already has him thinking about his financial future in terms of investing money in a home and learning how to save for emergencies.
“Definitely this program is teaching me how to invest my money; what to do with my money and how to make my money make money for me,” Britt said.