Sandy Chin has established herself as an authority on buyside of consumer staple stocks leaning on over 20 years of experience as a hedge fund portfolio manager.
Her hedge fund Tidal Bore Capital, which she launched in 2016 along with her mentor and colleague Bill Leach, has benefited from her signature bottoms-up approach to portfolio management.
Sandy Chin has worked as a Portfolio Manager at Visium Asset Management, at SAC Capital Management as a senior analyst and at Moore Capital Management. She was a Vice President and senior analyst at Neuberger Berman. During her time at Banc of America and Donaldson, Lufkin & Jenrette Sandy Chin worked on the sellside next to her future Tidal Bore Capital colleague, Bill Leach, who served as an influential mentor throughout her tenure working with him, even encouraging her to attend business school.
Sandy Chin attended business school at the prestigious New York University Stern School of Business and has an undergraduate degree from Columbia University’s Barnard College.
How did you get started in this business? What inspired you to start this business?
I honestly had no intention to end up in this industry. I started in pre-law studies and political science at Barnard College. I took a job at an equity research shop while I deferred law school. Very quickly, I realized that it was impossible to not fall in love with this business and finance has been my passion ever since.
Now, looking back, many of the things that appealed to me about practicing law are indicative of my experience within consumer staple stocks. There’s a parallel degree of working through conflict, which in finance is akin to using pattern recognition to put on nuanced trades and reading body language and looking for consistency in modeling company earnings.
How do you make money?
I run a consumer staples hedge fund that focuses on the management of equity consumer staples stocks.
Day to day, I spend a lot of time talking to trusted colleagues on the buyside and sellside, many whom I’ve known for decades covering the same sectors. We discuss what we’re seeing happen in the market, discuss line items in our updated models to look for any disconnects and analyze these trends relevant to consumer staples.
Because I’ve had over 20 years of practice in consumer staples, there are some universal truths about the market that I can recognize just from the changing pendulum of a particular stock.
How long did it take for you to become an expert in your field?
I was lucky that I was hired by Bill Leach, who became a mentor and advocate for me early on in my career. He insisted that I sit in on meeting with company managements and sellside analysts, that I was part of the conversation when it came time to build models, and that I learned the ins and outs of selecting stocks.
I believe that because of his influence, I was able to succeed much more quickly than some analysts who may have been stuck at their desk toiling away at building models but having little interaction with top managements or other analysts.
I genuinely feel that an investor needs to have at least a decade covering the same sector and live though the company specific movements quarter and quarter out in order to claim any expertise in an industry sector.
When you were starting out was there ever a time you doubted it would work? If so, how did you handle that?
I don’t think it’s possible to work in finance and not experience doubt of some form or another. There are so many unknowns within this industry, and even the most experienced analysts can make mistakes or make a bad stock call. Even the best stock pickers and portfolio managers will get half their ideas wrong, if not more. It’s the nature of finding fundamental positions. One way to address and handle the uncertainty is to have greater surety in the stock choices based on impending catalysts, an overarching thesis for a stock, valuation and gauging investor sentiment.
So, yes, of course, I’ve doubted things at times. But that’s also what’s so exciting about this business. I don’t just let the fear stop me from moving forward, instead, it lights a fire that pushes me to make far more informed decisions.
What do you think it is that makes you successful?
I’ve never been satisfied with doing the bare minimum. I believe that there is always more that can be gleaned from meeting with a particular company and asking some specific questions to build my own models, instead of relying on someone else’s as templates, to make my stock picking decisions.
I believe strongly in investing as if it were my own money and this forces me to think about investment opportunities with specific risks involved. What would I do if it’s my own money? What would I want my manager to do if it was my money?
What has been your most satisfying moment in business?
Tidal Bore Capital was always a dream for me. I knew that someday I would launch my own consumer staples focused hedge fund. When that day became a reality, it was truly gratifying. It was even better in that I had the support and partnership of one of my favorite and most trusted colleagues, Bill Leach, to co-manage the company with.
We’ve always worked very well together and to now have this venture and this familiar dynamic was exciting and really a lot of fun!
What does the future hold for your business? What are you most excited about?
I’m excited about the influx of women interested in finance. At the start of my career, there weren’t many women to be found in this sector- not because they were turned away or anything analogous to exclusion. Rather, the industry didn’t exactly recruit or encourage women to seek careers in this business, leading women to choose other careers elsewhere.
Now there are so many amazing organizations that are shepherding more women into the financial sector, and it’s inspiring to see this new energy and enthusiasm.