Lars Kroijer on the truth about hedge funds, demystifying investments and why you can’t beat the markets – MAF168


On the show this week is my guest Lars Kroijer, an author and former hedge fund manager.

We look at the truth about hedge funds, the content Lars creates to help demystify investments, and why it’s wrong to believe you can beat the markets.

Welcome to episode 168  of the Marketing and Finance Podcast.

Lars Kroijer on the truth about hedge funds, demystifying investments and why you can’t beat the markets - MAF168

What you’ll hear about in this episode

  • Why there’s a misperception about hedge funds
  • How Lars’ second book came about
  • Why Lars recommends index tracker investing
  • Why investing needs to be viewed as a long game
  • Why most people can’t beat the markets
  • What readers have learned from Lars’ book

Who is Lars Kroijer?

Lars is Danish. He’s been in England since 1999, and spent a decade in US before that.

He worked as an investment banker and hedge fund manager, setting up his own fund in 2002 and selling it in early 2008. He still sits on the boards of multiple funds.

His wrote his book to show the real version of the world of hedge funds and investment banking. Most of the other books, the media and popular culture portray hedge fund people earning and losing billions or buying Ferraris. After its success, he wrote another book, which led on to a series of videos on demystifying investments.

Summary of our chat

Lars says that TV shows such as “Billions” gives people the wrong impression of hedge funds. That the manager is a criminal, but because he’s rich and charming he gets away with it. It reinforces media stereotypes. So Lars wrote the book to show the reality of smart, hardworking, ethical people in finance.

Having experienced both sides of investing, Lars decided to write about how the average person has a minuscule chance of beating the markets. He believes many advisers or financial experts won’t tell people not to spend their money on beating the markets. So he wrote the book to make people realise it’s almost impossible to consistently beat the market. So what are the alternatives?

Lars doesn’t recommend evidence-based investing, and says people are better off with an index tracker. Most people will struggle to make the right investment choices, and it’s not a good idea to think you’re smarter than everyone else and you can beat the system, because it’s not easy to do.

People need to see investments as a long game. On average, over a long period of time, you will do better buying an index tracking investment.

In ‘Investment Demystified’, Lars says he wasn’t making a definitive statement about whether markets can be beaten or not, but that each individual has to decide if they can beat them. Most markets can’t be beaten, but it’s important to know which group you’re in, because it’s expensive to try.

Lars says that readers of the book have realised that they need time to learn about investments. Read the Financial Times and pick the right investment manager. This can be stressful when they’re also making decisions. Choosing an investment tracker instead and not trading it saves people a lot of time.

A marketing campaign or product that grabbed Lars’s attention

Lars has been following TransferWise, Revolut and similar products. The founders are young, tech-savvy people making traditional banks seem stodgy and old by making currency exchange cheaper or offering pre-paid credit cards without exchange fees. We all incur massive bank transfer fees but most people don’t know about them, so they’re challenging that.

Lars’s book recommendation

Lars says he has been reading a lot of books on AI (artificial intelligence) and enjoyed ‘Life 3.0: Being Human in the Age of Artificial Intelligence’ by Max Tegmark. If you embrace his arguments, then AI really matters, and it makes you think about the impact of the rise of computer-driven intelligence and what that means for our lives.

Links and contact details

If you have an investment-related question, Lars suggests posting this on his YouTube channel, so he can answer it more broadly and everyone can benefit from the answer. Search for ‘Lars Kroijer Investing Demystified”.

Read Lars’s book.

If you enjoyed – Lars Kroijer on the truth about hedge funds, demystifying investments and why you can’t beat the markets – please leave a comment or a review on iTunes.

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Don’t Fear Social Media in your Marketing

Some companies, particularly in regulated industries like financial services, still fear using social media in their marketing.

Or using social media at all.

I recorded a podcast about this over two years ago but I still get the same questions asked of me by clients today.

In this short video I look at why some companies have a problem.

And I have one big tip and a giant cup of coffee to tell them it’s time to stop being afraid.

It’s all to do with how they perceive social media platforms.

If they see them simply as another promotional channel then they’ll naturally treat each Tweet and each post as a promotion or advert. That means full compliance with the regulations.

They don’t want to risk breaking the rules so they shy away from social media.

But if you use social media for what it is, a social interaction. A two way conversation. An engagement. Then the regulation problems go away.

Don’t promote stuff. Just have a conversation.

My top tip is this.

“Don’t push product. Just point to great content”.

If you do that, you’ve no reason to fear social media.

Did you enjoy this video? Please subscribe to my YouTube Channel right here.

If you enjoyed this episode of Marketing and Finance TV – Don’t Fear Social Media in your Marketing: Even if you’re in financial services – please share it with your friends and colleagues. You can use the social media share buttons just below.

Don't Fear Social Media in your Marketing: Even if you're in financial services

Russ Roberts on how economics can help marketing and modern life lessons from historical economists – MAF167


On the show this week is my guest Russ Roberts, an economist, author and rapper.

We talk about how economic theory can help marketers simplify messages for their customers, writing fiction to teach economic theory and the modern life lessons we can learn from Adam Smith .

Welcome to episode 167  of the Marketing and Finance Podcast.

Russ Roberts on how economics can help marketing and modern life lessons from historical economists - MAF167

What you’ll hear about in this episode

  • How Russ became interested in economics
  • Why making assumptions can help marketers make things simpler
  • How economics influences the marketing process
  • What inspired Russ’s novels – fiction that teaches economic theory
  • What Adam Smith can teach us about living in the world today
  • Why empathy is important to humanity

Who is Russ Roberts?

Russ trained as an economist at University of Chicago. He’s always had an interest in non-economic stuff, which has led his career down varied paths. He’s created rap videos, an animated poem and written three novels that teach economics through fiction and dialogue.

Russ became a podcaster in 2006.  He says this is the most interesting thing he does with his time.

He’s now a Fellow at Stanford University’s Hoover Institution and has just written a book, “How Adam Smith can Change Your Life.”

He tries to make economics interesting and accessible to a non-academic audience.

Summary of our chat

Russ found he was good at economics. As he studied it became fascinated with its puzzle-like nature and the way pieces fit together. He says that when it’s properly taught, economics is less about mathematics and more about philosophy, psychology and human nature. The dryer side is less interesting and effective, even though it’s what serious economists do.

People make fun of economists because they make a lot of assumptions. But assumptions help us to understand the complex world and grapple with the richness of life. People aren’t all the same, but marketers can benefit from using assumptions to look at price and supply and demand. Marketers can learn from economic models to help them simplify the world.

Econometrics is the application of statistical methods to economic problems. There’s a lot of that in marketing, although it’s imperfect. It’s an attempt to hold certain things constant, such as in an advertising campaign or price changes. Despite the flaws, you can still learn from it and apply it to marketing for the benefit of customers.

In the early 1990s, Russ was worried about the trade situation in the US, particularly Japan taking over industries. He wanted to look at how trade allows us to flourish. This led to his first novel – a dialogue between an American executive and David Ricardo, the English economist. He wrote fiction to teach economic theory.

19th century economist Adam Smith is most famous for, “The Wealth of Nations”. But his other book, “The Theory of Moral Sentiments”, is more interesting for today’s audience. It’s an attempt to understand human nature, self-interest, and why we care about others. Russ’s book takes Smith’s view of humanity and spins out lessons for the 21st century.

Smith argues that trade encourages us to be empathetic, because if we want to be successful we have to put ourselves in our customers’ shoes. We care about how people perceive us and want to earn their respect. One application of this is how products make us feel a part of something and allow us to express status.

A marketing campaign or product that grabbed Russ’s attention

Russ says he has a handful of products which are so pleasant to interact with that they dwarf their equivalents from 10 and 20 years ago. For instance, Spotify gives access to incredible music in the car and at home, which is such a delight but something that’s not captured by its marketing campaigns.

Russ’s book recommendation

Russ doesn’t read a lot of business books, because most of them are telling us things we already know. Sometimes they can fool people into thinking they can’t learn from latest trends. This is a deep misunderstanding of why we read and take in the world. Sometimes reading about things we already know reminds us about them. otherwise we might forget when it matters most.

He’s a big fan of author Nasim Taleb, and Fooled by Randomness is an extended essay on how the world is random, and full of risks.

Links and contact details

Read Russ’s Book – How Adam Smith Can Change Your Life.

Watch Russ’s economics rap video

If you enjoyed – Russ Roberts on how economics can help marketing and modern life lessons from historical economists – please leave a comment or a review on iTunes.

And if you know anyone who would enjoy the show – please share it with them. You can use the buttons below to share on social media.

Don’t miss an episode of the MAF Podcast – subscribe now.

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