Podcast Summary: Enterprising Investor
Episode: Mark Anson, CFA: Rethinking Portfolio Construction in a Globalized, Uncertain World
Release Date: August 1, 2025

Introduction

In this insightful episode of Enterprising Investor, hosted by CFA Institute's Managing Director of Education, Chris Wease, listeners are introduced to Mark Anson, CFA—a seasoned investment professional with a distinguished career managing some of the industry's largest asset management firms and pension plans, including Nuveen Investments, Hermes Pensions Management, British Telecom's pension scheme, and CalPERS. Currently serving as the CEO and CIO of the Common Fund, Anson shares his expertise on portfolio construction, global investment strategies, risk management, and future industry trends.

1. Navigating Global Regulations

Timestamp: 01:35 - 02:56

Mark Anson begins by emphasizing the critical role of regulation in investment management. He explains that while regulations provide necessary oversight, they also impose constraints on how businesses operate globally.

Mark Anson (01:53): "Regulation is a necessary oversight for every country. But it provides constraints on how you operate your business."

Operating in multiple countries, including China, the UK, Germany, and the US, Anson highlights the importance of understanding each country's regulatory landscape to effectively manage investment products and interactions with local investment managers.

2. The 30-30-40 Asset Allocation Strategy

Timestamp: 02:56 - 05:34

Anson advocates for a 30% equity, 30% fixed income, and 40% alternatives (30-30-40) asset allocation model. He discusses the diminishing diversification benefits in public equities due to increased global market correlations.

Mark Anson (03:19): "The global markets have become more coordinated and they tend to react similarly. That means diversification isn't as robust in public equity markets as it once was."

The shift towards alternatives is driven by the need to seek additional diversification and yield, as traditional public equity investments no longer offer the same level of risk mitigation. Anson elaborates on how the alternative allocation includes credit, private credit, mortgage-backed securities, and other yield-focused assets.

3. Public Equities and Emerging Markets Focus

Timestamp: 05:35 - 06:59

Discussing public equities, Anson notes a slight bias towards the US in Common Fund's portfolio while increasingly exploring emerging markets (EM) for growth opportunities and diversification.

Mark Anson (06:08): "When we look for good private equity managers, we look for those private equity managers that have one or two industry domain expertise."

He underscores the potential of EMs like China, the second-largest economy, and highlights the robust opportunity set driven by young labor forces and rising middle classes in these regions.

4. Investing in Private Markets and Capturing the Liquidity Premium

Timestamp: 07:06 - 09:51

Anson delves into the significance of private capital within the Common Fund's investment strategy. He explains the concept of the liquidity premium—an additional return expected for investing in less liquid assets.

Mark Anson (08:21): "There's no ETF or index fund. So the way you have to do it is by finding good investment managers in the private capital space that will capture that liquidity premium for you."

He differentiates between venture capital and private equity, noting that while venture capital success depends on a few top-tier firms, private equity offers broader diversification opportunities across numerous firms focusing on specific industries.

5. Impact of Potential Taxation on Endowments

Timestamp: 09:51 - 12:08

Addressing the potential changes in taxation policies affecting endowments, Anson discusses how increased taxes would introduce new constraints in portfolio construction.

Mark Anson (10:10): "If indeed there is going to be a tax on endowments, you would have to build this tax loss harvesting into the portfolio construction process."

He explains that endowments, traditionally tax-exempt, would need to incorporate strategies like tax loss harvesting to offset gains and balance between long-term and short-term investments to manage the tax implications effectively.

6. Principles of Risk Management in Uncertain Times

Timestamp: 12:08 - 14:28

In the context of heightened economic uncertainty, Anson outlines his approach to risk management, focusing on both traditional risk premiums and exogenous shocks such as policy changes.

Mark Anson (12:27): "Risk management for us is not only looking at the traditional risk premiums... it's looking at these administrative shocks that will come in exogenous to the economics of the market and how they then impact the economics of the market."

He highlights current risks like the impact of tariffs, potential Federal Reserve rate adjustments, and the overall economic uncertainty reflected in high indices, drawing parallels to the volatility seen during the COVID-19 pandemic.

7. Future Trends: Regionalization and Capital Flows into Private Equity

Timestamp: 14:28 - 16:58

Anson anticipates a shift from globalization to regionalization or even isolation due to changing geopolitical dynamics and trade policies. He foresees continued regional cooperation, especially in North America, influenced by current tariff policies.

Mark Anson (14:46): "It's no longer globalization. It might be regionalization or maybe even isolation."

Additionally, he observes a significant trend of increasing capital flows into illiquid assets like private equity. Despite concerns about crowding in this space, Anson believes opportunities remain abundant by carefully selecting specialized private equity managers.

Mark Anson (15:46): "There's still a lot of opportunity to extract value from private equity and other illiquid asset classes."

8. Advice for Young Investment Professionals

Timestamp: 16:58 - 19:22

Concluding the conversation, Anson offers valuable advice for aspiring investment professionals. He strongly recommends pursuing the CFA charter, emphasizing its long-term career benefits.

Mark Anson (17:23): "Take the CFA. It's well worth it. Don't put it off. Do it as soon as you can."

He also encourages young professionals to seek international experience, leveraging the global nature of the CFA designation and the investment industry to gain diverse perspectives and opportunities.

Mark Anson (17:50): "Get outside the US. Getting a different perspective helped me so much in my career."

Conclusion

Mark Anson's comprehensive discussion provides deep insights into modern portfolio construction in a globalized and uncertain environment. His emphasis on adaptive asset allocation, the strategic inclusion of alternative investments, proactive risk management, and the importance of professional development serves as a valuable guide for investment professionals navigating today's complex financial landscape.

Notable Quotes

• On Regulation:
  "Regulation is a necessary oversight for every country. But it provides constraints on how you operate your business."
  (01:53)

• On Public Equity Correlation:
  "The global markets have become more coordinated and they tend to react similarly. That means diversification isn't as robust in public equity markets as it once was."
  (03:19)

• On Liquidity Premium:
  "There's no ETF or index fund. So the way you have to do it is by finding good investment managers in the private capital space that will capture that liquidity premium for you."
  (08:21)

• On Taxation Impact:
  "If indeed there is going to be a tax on endowments, you would have to build this tax loss harvesting into the portfolio construction process."
  (10:10)

• On Risk Management:
  "Risk management for us is not only looking at the traditional risk premiums... it's looking at these administrative shocks that will come in exogenous to the economics of the market and how they then impact the economics of the market."
  (12:27)

• On Future Trends:
  "It's no longer globalization. It might be regionalization or maybe even isolation."
  (14:46)

• Advice for Young Professionals:
  "Take the CFA. It's well worth it. Don't put it off. Do it as soon as you can."
  (17:23)

This in-depth summary encapsulates the key points discussed by Mark Anson, providing valuable takeaways on portfolio construction, global investment strategies, risk management, and career development in the investment management industry.