Sandy Chin is the founder of Tidal Bore Capital, which is the first hedge fund that focuses on consumer staples. The hedge fund was launched in 2016, with Sandy Chin having 20 year of experience when it comes to covering consumer staples. According to her, these staider stocks can have attractive returns, and she also considers that they are misunderstood.
As far as her academic track record goes, Sandy Chin earned her MBA degree from NYU’s Stern School of Business, and also holds a BA degree in political science, earned from Barnard College. She worked with her mentor on the sell-side at Donaldson, Lufkin & Jenrette as well as at Banc of America.
She joined the buyside after her stint at those organization, and had a long career working for various institution. She worked for Neuberger Berman for 5 years, serving as a Vice President and also as a senior analyst. Her career then exposed her to the world of hedge funds, working for Moore Capital Management for 3 years. In addition, she worked for SAC Capital Management for 3 years, serving as senior analyst, and before launching her own hedge fund she served as a portfolio manager for Visium Asset Management.
Learning Under The Mentorship of Bill Leach
She spent 10 years under the mentorship of Bill Leach, which she points to as a time that helped her hone her analyst skillset. She was hired by Leach at Donaldson, Lufkin & Jenrette – with Chin being only the second associate he hired in more than 20 years at DLJ – joining his team which was covering food stocks.
She was asked to attend conferences and meetings with him, which she notes enabled her real education as far as learning how to value staple stocks and how to question management companies. The two worked together at 3 different firms, remaining a team, and later on reuniting at Tidal Bore Capital after 6 years.
As far as learning important lessons from her mentor, Sandy Chin points to 4 main lessons she took with her from the time the two worked together. The first lesson she pointed to was the idea of never turning down a meeting, regardless of how junior the analyst or how small the company is. The second lesson was to always develop her own quarterly as well as annual models and to not borrow them from the sell-side.
The third lesson was to ask question in meetings and at conference, as they enable development of relationship with management and analysts, and the fourth lesson she points to is to always invest personal money in stocks. Investing personal money in stocks is designed to help a person understand and learn the way stocks move after strong investor day presentations or disappointing earnings reports.
Typical Day At Tidal Bore Capital
She starts her day by checking emails and headlines in order to find news about companies in her field, and she will also review headlines on companies that are one degree separated from her sector in order to see if anything could impact her stocks and sector. During her day she speaks to sell-side analysts as well as with people from the buy-side, in order to have a broader picture when it comes to the sentiment of a stocks.
Once the market opens, she focuses on outliers in her portfolio and why they are moving in certain directions. She also updates her proprietary spreadsheets and financial models, and often times throughout the years there are sell-side conference calls or meetings that require her attention.
During an interview she also talked about her mentality during earnings season, noting that she would assess the earnings news once it hits, the update models in order to see if there are disconnects between the stock movement and fundamental and news, followed by getting on earnings conference calls for the companies that are part of her portfolio.
Staying Productive as an Entrepreneur
She points to her usage of extensive pattern recognition in her modeling when following stock movements and when speaking to managements and analysts as a habit that makes her more productive. She also recommends building quarterly and annual models, due to the fact that borrowing sell-side models and tweaking some items will not help people build high conviction stocks. Building the models helps build the pattern recognition and also, according to Sandy Chin, offers confidence when it comes to seeing the disconnect between valuation and fundamentals.
Never turning down a meeting has been a strategy that helped her when it comes to growing her business, and she notes that regardless of the importance that the meeting might have, some new information might get uncovered. She also believes that this would help build strong relationships, as companies and analysts don’t forget early kindness.
Advice For The Stock Market
Having more than 20 years of experience in the industry, she offered a few key points when it comes to investing in the stock market and stock market dips. She considers that researching the history of certain stocks should be done before investing in it, as it will help investors have an understanding on whether or not investing is a good idea, but it will also help investors figure out when to buy or sell shares in the future.
She also considers investing in new stocks to be important, and even if investing in a new stock is short-term, it plays a role in helping the investor gain knowledge about the competition. In addition, she considers that the power of the individual investor should not be undervalued, due to the fact that entrepreneurial organization often times start out as individuals, and without investors who are ambitious and have eager attitudes, massive changes to the economy and stock markets would not take place.
Outside the World of Finance
While playing a big role in her sector, she also takes time for outside ventures. One of them being last year’s summer reading program at the public elementary school, PS11 in New York. Alongside a group of volunteers, the goal of the summer book drive at the school was to collect used books in order to be given away to kindergarten students for them to take home over the summer break. The response was bigger than expected, and enough book donations were made in order for them to get distributed to children from all grades.
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