We recently chatted with BlackRock’s Chief Multi-Asset Strategist Isabelle Mateos y Lago to learn about what led her to a job in investment strategy, how she formulates her market views, how she spends her free time, the advice she would give to women just starting out in the financial industry, and more.
This post, featuring highlights from our discussion, is the first in an ongoing series of Q&As with BlackRock investment strategists.
Q: When you were young, what did you want to be when you grew up?
A: I did not want to be a multi-asset strategist, I can tell you that. I wanted to be a diplomat, an ambassador. I was always interested in international affairs and politics. Then I realized while I was in college that you don’t get much done if you don’t have the economy running well, and this led me to grow interested in economics. I grew up in France in the context of the building of the European Union, the single market and the euro. I witnessed all the setbacks along the way when attention to economic issues was insufficient.
Q: You started your career at the French Ministry of Finance. Then, you spent 15 years at the IMF. How did you get from there to joining BlackRock in 2015?
A: After 17 years working in economic policy, I realized it’s not enough to get the economy right. You also have to have the financial markets working alongside the economy. That’s when I became interested in understanding financial markets from the inside. Also, after 15 years at the IMF, I was interested in trying something different that was still satisfying to me and contributed to the public good. BlackRock ticked all the boxes.
I went the route I did after school because I was keen to work for the public good and I felt government was the best place to accomplish that. It took me a long time to realize that you can do that from the private sector as well. Something I really value very much at BlackRock is the idea that we manage the pensions and retirement money of millions of people and if we do a good job, they will have a better future. That is something that inspires me and is a concrete way of impacting people’s lives.
Q: As BlackRock’s Chief Multi-Asset Strategist and a part of the BlackRock Investment Institute (BII), you are responsible for helping to shape BII’s macro and market views. What is your approach to doing this?
A: I think of multi-asset strategy as taking a full-portfolio view instead of a view of how one particular theme or development with be reflected in one asset class. It involves thinking about a portfolio that has some fixed income, some equities, some currencies, some alternatives, etc., and how I would expect each element of the portfolio to behave in this macroeconomic and geopolitical environment versus what is actually happening, and how might I want to re-balance that portfolio in response.
I start with top-down views of how I would expect the market to behave in response to the macroeconomic and geopolitical environment, and how I would expect different asset classes to react to this backdrop (read more on key geopolitical risks at the BlackRock Geopolitical risk dashboard). Then I contrast and compare this view with how much has already happened in these different asset classes. I also collect the views from BlackRock portfolio managers and researchers who are most experienced in each of these asset classes to gather some bottom-up insights. I complete my overall market view through this dual approach.
Q: Where do you see investing opportunities right now?
A: There has been a reluctance in the market in really taking the risk exposures that would be warranted by the amount of global growth that we see, and that is understandable because there is a lot of economic uncertainty. In our view, the way to do deal with this is to keep a risk-on position but build up resiliency by focusing on higher-quality assets across the board, as we write in our Global investment outlook for the fourth quarter of 2018.
Q: What is the toughest part of your job?
A: It’s striking a balance between being current on everything that is driving the market on a given day without getting lost in the weeds, making sure to always keep in mind the big picture and not overreact to the day-to-day noise.
Q: How has it been being a woman in male-dominated industries, first economics and then finance?
A: I think it’s getting better, and people are generally trying to move the needle in the right direction. It’s a needle, though, that is moving very, very slowly, so I’m very pleased if I can help move things in the right direction. One the achievements I’m most proud of is when I get unsolicited comments from young women in the financial industry who say seeing me in my role, which has quite a bit of media and internal visibility, inspires them.
Q: What advice would you give to women just starting their careers?
A: Don’t undersell yourself. The test of when women will have reached parity in any industry is when there will be a meaningful number of mediocre women in important positions. Right now, it’s still the case that women need to outperform to move ahead.
I have three children, and I was lucky that I had them very early in my career. I can’t say I found a great recipe for juggling work and family, but I do think young women also need to understand there is a spectrum when it comes to having kids and working. Some women feel they have to sacrifice work for their children and vice versa, but there is actually a whole range of intermediate solutions in between.
Q: What are you interested in outside of work?
A: I’m very interested in economic history, literature–I’m an avid audio book listener when I travel and commute–and cycling. Studying economic history–understanding the cause and effect between certain political decisions and economic and market outcomes–helps me become more forward looking in my work and better discern the big picture.
For more, read posts by Isabelle Mateos y Lago, and stay tuned for the next interview in the Meet the Strategist series.