Thomas Lefler Director of Absolute Return, Raytheon Waltham, Massachusetts Art by Iris Lei
Thomas Lefler

“Thomas is an astute investor who has a knack for digging deep and bringing his full experience to bear on an investment topic. His talents and contributions not only benefit our team, but a multitude of Raytheon beneficiaries.” 

— Scott A. Lupkas, VP, Pension Investments & CIO, Raytheon Co.

Duly regarded as a thoughtful, outside-the-box investor by his peers, Thomas Lefler is attributed with revamping Raytheon’s hedge fund portfolio and generating positive returns in strenuous investment environments. Raytheon’s hedge fund program has generated strong returns under Thomas’ stewardship and he has garnered great respect across the industry.

Thomas has been at the company for over six years having joined from Spartus Capital Management in 2013. While his attention has been focused on Raytheon’s hedge fund allocations, Thomas is transitioning to the company’s new Portfolio Strategy and Risk group tasked with driving, implementing, monitoring, and overseeing the total $20B DB pension plan’s investment strategy. Key areas of oversight include asset allocation, risk management, data and analytics infrastructure, portfolio overlay, and collaborating with the manager research team to bridge the gap between the top-down and bottom-up elements of the plan’s overall portfolio construction. 

Thomas has more than a decade of investment and leadership experience and has held positions at the Indiana Public Retirement System, Citigroup Global Markets, and at Spartus Capital Management. He holds an MBA from the University of Kentucky and a Bachelor of Arts degree in Mathematics from Transylvania University”

CIO: What makes 2019 an interesting investing climate? How are you handling it?

Lefler: Quite simply, the tug-of-war between slowing growth, decent fundamentals, accommodative monetary policy, low inflation, and a bull market that everyone wants to hate. 

From an allocator’s perspective, I think it’s important to be thoughtful about where your allocations sit within strategic ranges, how portfolio risk levels are likely to evolve, and making sure that you don’t become a structural/governance/policy related forced seller. Remaining disciplined, patient, and provisioning both the capability and willingness to allocate into dislocation is the best way to capitalize on the value of mid-to-longer term investment horizons.

CIO: After this year, what are the largest opportunities and the largest threats you see on the horizon?

Lefler: I certainly have more questions than answers as it relates to the global economic landscape over the next couple years. At a high level, the number of known knowns and known unknowns feels predominantly the same. The pool of unknown unknowns feels like it is growing and therefore reshaping the preverbal distribution of likely outcomes. Leaning into active management feels prudent given that active management is both a tool to manage risk and to generate returns.

CIO: How did you arrive at your current position? And why did you choose this part of the financial services industry?

Lefler: I have been extraordinarily fortunate to have had the opportunity to work in and experience the financial services industry from many perspectives. Constantly learning, adapting, applying new ways of thinking, and continuing to build broad perspective is core to who I am and what I look for as I develop my career and look for career opportunities. A career as an allocator is a unique combination of all of the above and it also provides the opportunity to directly contribute to an organization’s ability to achieve its long-term mission–which I find incredibly motivating.

My arrival at Raytheon was a result of a meeting I had with the CIO in 2011 while at Citigroup. Our team met with Raytheon to share our perspectives, and fortunately for me, the CIO remembered our meeting and was open to meeting with me again when I was looking to transition back to being an allocator.

CIO: What was the most important strategic allocation of your career?

Lefler: I’m a firm believer that the most valuable decisions we make as investors are those opportunities we choose not to pursue. The issue, however, is that the value of these decisions is impossible to attribute. My most important decision was likely one of these.

CIO: Tips for money managers who want to work with you, especially what not to do.

Lefler: This is simple. Be respectful, be honest, and be transparent. All of the things we aspire to be with our partners.

CIO: Biggest goof a money manager has made with you? 

Lefler: Our team was meeting with a credit manager a year or two ago and our respective views of a particular market segment differed significantly. Rather than debating or sorting through the key assumptions that drove our divergent views, the manager became hyper aggressive and seemed more interested in winning the “argument” than engaging in constructive dialogue.

Right or wrong never really mattered. In this particular case, the tone of the conversation was more than enough information despite the fact that we liked their strategy and investment approach.

CIO: Who in the financial world would you like to have lunch with and why?

Lefler: Ken Langone. I first heard Mr. Langone speak at the Robin Hood investor conference a couple years ago. He was interviewed by Paul Tudor Jones. I had never heard the Home Depot story and what resonated most was the passion he exuded for the people who worked for Home Depot and the value he placed on each employee irrespective of their level or seniority or function. I was both surprised and impressed to learn that Home Depot has never paid a single employee minimum wage. I highly recommend reading his book, “I Love Capitalism.”

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

Lefler: I would like the institutional community to come together as a group. While there are many industry conferences geared toward creating opportunities to network and learn from one another, it’s ultimately a choice. I see tremendous value in forging unique partnerships across allocator types and broadening perspectives to include how other organizations, beyond direct peers, think, conduct business, and view the world.

CIO: What are your hobbies not correlated to work?

Lefler: Spending quality time with my wife and two young children is my No. 1 life priority outside of work. For me, family comes first and is the most important and rewarding part of my life. I also enjoy cooking and in particular, southern BBQ.

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