Executive Interview: Lim Shyong Piau, Lion Global Investors, CMO

Lim Shyong Piau is no stranger to the finance industry in Singapore, with over two decades of experience in the fund management industry.

He is the Chief Marketing Officer at Lion Global Investors, a position he has held since 2016, and manages the business development, distribution and client servicing operations of both the firm’s domestic and international businesses.

Prior to that, Lim was the Managing Director and the Head of the Singapore operations at Invesco Asset Management Singapore. During his 8 year tenure, Lim took charge of the business development activities in South East Asia, South Korea, and India.

In March, Zuu Online sat down with Lim for an interview about his investment journey, which started sometime after he had completed his GCE A Level examinations.

“I just picked up the phone and called my father’s broker and started trading,” he said in earnest. “Honestly, it was pure stock market trading and wasn’t too sophisticated. I guess I was just fortunate to have done reasonably well over a period of time.”

 

A long-term goal

In fact, Lim did so well that his interest in stock trading continued for another 16 years after that first phone call. “If you think about it, that makes a lot of sense because investments are about being long term oriented and not about flipping a stock after a week or two.”

“If you buy into a business and you think it’s going to do well because it has all the right fundamentals, then you should just stay invested and let it run and benefit from the compounding effect. This is especially so for a good business with the right business model and an economic moat that gives them a competitive advantage.”

Lim’s long term investment philosophy has served him well even today.

“There will always be cycles in any kind of business, including the fund management business, so we have to think a little bit longer term, make the right investments in people and technology, and work towards a longer term, or at least a medium term goal,” Lim explained. “Lion Global Investors is focused on the long term, and what that means is, we shouldn’t be overly concerned with the month-to-month, quarter-to-quarter, or even year-to-year fluctuations.”

“We also know for a fact that in this business, there is no one manager that can be number one day in and day out, year in and year out. There will be cycles, sometimes you do well, sometimes you won’t. Don’t get too complacent when you do well, and when you don’t, remember to stay on an even keel to focus on doing the right things and focus on the basic fundamentals of the business.”

 

Competitive swimming to fund management

Lim showed Zuu Online an old photo of himself saved in his mobile phone. It was a picture of a fresh-faced, tanned and youthful version of Lim during his days as a national swimmer.

“I was swimming before Joseph Schooling was born,” he quipped, as he recalled waking up at the crack of dawn every day to fit in a swim practice before he headed to school. It would take another half day of school, two more 2-hourly swimming sessions and homework time before his day ended and the cycle repeated itself.

“There are a lot of parallels if you look at competitive sports and the fund management business, because the competition is really intense,” he explained, adding that there is no guarantee that anyone will always emerge at the top.

“While we cannot control the outcome of a fund, we can control the amount of time we put in to do fundamental research, we can control how diligent and conscientious we are, and we can decide that when it comes to portfolio implementation, we execute it in a cost-effective manner,” he said. “It’s not about being cheap, or being on a low budget, it’s all about getting the best bang for the buck.”

 

Biggest investing mistake

Lim recalled one of the biggest investing mistakes he had made in the late 1990s. After having had much success in stock trading, and feeling very confident in his abilities, Lim decided to start investing through leveraged futures trading.

“I got my fingers badly burned,” he said, adding that he paid a steep price for a valuable lesson learned.

“It was contrary to what I originally thought about investments which is long term oriented. I mean, flicking in and out of a position in a futures market, what is long term about that?”

To prevent other new investors from making the same mistake he made, Lim urges new investors to learn more about fundamental investing, particularly if they do not have deep pockets to begin with.

“If it’s your spare change and pocket money, by all means do whatever you want to do with it, but if it’s for longer term savings, and you’re at your stage in your life where you are trying to grow your wealth and accumulate a base, then you don’t want to fiddle around that way with the money that you have.”

 

So, what investment does Lim recommend?

Source: Shutterstock

Right now, Lim is spearheading the LionGlobal Disruptive Innovation Fund, which allows investors to invest in the fund with as little as $100. For that amount, investors would have a globally diversified portfolio of 100 equities of disruptive companies that may include the likes of Facebook or Amazon.

“There’s a big misconception that these platforms, like Snapchat and Amazon, are only for the younger generation,” Lim said thoughtfully. “The reality is that we are all users of all these new technology and new innovation and new businesses, but we have become so preoccupied with fiddling with these things, that we neglected to think about how we can financially and economically benefit from all this, other than being the one paying for the product or service.”

“Collectively, all of us are big contributors of these companies’ business growth, revenue growth and profitability, yet we are not taking advantage of it.”

Lim intends to change that with the launch of the LionGlobal Disruptive Innovation Fund. The portfolio of 100 companies comes from an investible pool of 500 companies that have successfully disrupted the incumbents in its respective business space. These companies are either successful software innovators, hardware innovators, or have seen significant breakthroughs in their field.

The portfolio is selected through a five factor screening base which includes market capitalisation, volatility, sales growth, earnings per share growth and price to sales ratio. The passively managed fund is then rebalanced every quarter.

Lim believes the LionGlobal Disruptive Innovation Fund’s minimum investment amount of $100 makes having a diversified portfolio much more accessible to small time investors. “Plus, I think the annual management fees are extremely compelling at 100 basis points, and with no sales charge.”

 

Not a venture capital fund

While the LionGlobal Disruptive Innovation Fund is not limited to technology companies, nor by a specific sector or country, Lim cautioned against the perception that the fund would invest in startup businesses that had innovative but unproven solutions.

“It’s important to know that with this fund, we are not trying to play the role of an angel investor or a venture capital. What we are looking at, are proven things. Proven technology, proven businesses, as well as successful and sustainable businesses. So, we won’t invest in startups,” he said firmly.

“The startup environment is quite different, and I don’t think the regular man in the street has the appetite to deal with a ten bagger out of the portfolio of 10 companies, and have 9 of the companies fail along the way.”

 

Worthwhile investment

In fact, Lim is so convinced that the LionGlobal Disruptive Innovation Fund is a worthwhile investment that he plans to invest in it himself, on behalf of his two sons who are 9 and 7.

“It will be about 15 years before they start working and become financially independent, and I think it’s a good time horizon to be invested in this fund,” said Lim. “I also intend to do this as a regular savings plan. An RSP conceptualises dollar cost averaging, and allows you to ride over the ups and downs that you are bound to see in the equities market.”

What’s interesting, is that this investment would also be Lim’s first investment into a fund.

“In the past, I was very aggressive in managing my own investments so I didn’t see the need to use a fund,” he said. “But at this stage of my life, where I’m a little bit busy at work, and want to be present during my sons’ growing years, I think some decisions are best left to the experts.”

“I might as well leave it to Lion Global Investors to do the hard work for me.”

(By Gwyneth Yeo)

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