Class of 2017 Forty Under Forty

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Nicole Solomon Portfolio Manager, Kokino, LLC
(New York, NY) 37
Nicole Solomon
(Art by Marcellus Hall)

Nicole has that rare combination of being both a shrewd investor while maintaining strong relationships with managers and colleagues alike. Over the span of her career, she has honed the skill of finding hidden gems in the market, resulting in very strong risk-adjusted returns for her clients.

How have you been a change agent at your organization? What have you done that you’re particularly proud of?

I spend my time focusing on under the radar, niche strategies and try to stay away from large institutional managers. Areas of dislocation tend to be good hunting ground and patient capital affords me the luxury of waiting for worthwhile opportunities with which to deploy dry powder. Many of the larger opportunities tend to be highly correlated with the broader markets, yet we pride ourselves on staying nimble in order to identify those uncorrelated opportunities with the highest risk/reward.

What is the asset class or investment that keeps you up at night, and why?

I worry that we spend too much time focusing on what has worked in the recent past and extrapolate that into the future. It’s a basic human tendency to believe that what has been working will continue to work and to pare back from those trades that have lost money. With equities on a multi-year run and valuations at all-time highs, I try to remain vigilant should we become further fatigued with lower beta strategies in favor of equity-like risk profiles.

What methodologies have you adopted within your institution?

I’ve institutionalized our due diligence process and streamlined the manner in which we assess and monitor new and existing investments.

Where do you fall in the passive vs. active debate?

There will always be a place for active management in our portfolio. The recent outperformance of passive management just renders the bar that much higher to identify alpha-generating strategies that justify the higher fees.

What are the changes you’d like to see the institutional investing community make in 10 years?

More transparency and better alignment of interests.

Who is a manager you don’t currently work with whose brain you’d like to pick?

Warren Buffett.

Ideally, where would that meeting take place?

At his local McDonald’s, of course!

What is the software investment tool that helps you most?

eVestment and Symmetric.

What would improve the relationship between you and managers?

More transparency and better alignment of interests. Managers should put their fiduciary responsibilities to clients above their own personal gain.

Why did you choose your current path?

The investment management business is one of the only industries where the learning curve is constantly steepened due to an ever-evolving opportunity set. The intellectual rigor required in uncovering and researching sound investment opportunities keeps the role dynamic and stimulating.