- Financial Services
- Markets
August 14, 2024
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Inside the Buy-Side
David Rosenberg
Founder and President of Rosenberg Research & Associates Inc.
David is a financial economist who founded Rosenberg Research & Associates Inc., an economic consulting firm, in January 2020. Prior to Rosenberg Research, David was Chief Economist & Strategist at Gluskin Sheff + Associates Inc. from 2009 to 2019 and was Chief North American Economist at Merrill Lynch from 2002 to 2009.
Q. What is your professional background and current role?
I cut my teeth over decades bringing the economy to life for investors by connecting the dots between the macro and the markets, and taking economic data points and formulating cogent, cohesive, and coherent investment strategies out of them. What I’m doing now is running my own economic and financial consulting business called Rosenberg Research. After decades of working for big companies, both on the sell-side and the buy-side, I decided to strike out on my own so that I could provide my unvarnished and unbiased opinions on what’s happening in the world of macro markets to my client base.
I love what I do… but [to me] it’s really an art form to be able to take some data, formulate an investment strategy out of it that other people might not be looking at, and then express [that strategy] either verbally or in written form. I love to write, and the top commandment at Rosenberg Research is that you have to be able to be a great writer to be successful at my firm.
Q. How has Rosenberg Research evolved since its founding in 2020?
It’s really been a constant evolution. Prior to 2020, I had been selling my research to the outside world all the years that I was at Gluskin Sheff + Associates — which was a notable and prestigious mutual fund in Toronto — so I started Rosenberg Research already knowing that I had a client base and a revenue line. The question all along was “How do I build that business?”
At the start, I published a daily report called Breakfast with Dave, which I still do. When I launched the business, I had a couple of publications in addition to Breakfast with Dave, and I had six employees and 1,600 clients. Today, I have 18 employees and almost 3,000 clients in 40 countries.
We’ve continually listened to our clients in terms of what their needs are. We now have a larger menu of options that are investment-oriented; we still pride ourselves on macro, but the bells and whistles we’ve added have been more on making market calls, both short-term and long-term. For example, we publish a monthly report called The Strategizer that is an active investment and asset recommendation publication covering all asset classes and equity sectors across all geographies. After just one year in business, The Strategizer is rivaling Breakfast with Dave for top readership.
Another thing we’ve introduced that I’d never done before — and which I entered into with great trepidation — is my thought leadership webcast series. I started out doing that alone in front of a screen, but I received feedback from clients that I should invite guests on and took their advice. I started to deploy my Rolodex and it’s been an enormous hit. I bring on industry and market thought leaders — they may be in finance or in politics — and it is always geared toward helping clients make money and save money.
“I learned early on how important it is to be thought-provoking and to consistently play the role of an economic detective — to find the story beneath the story, and to look for things that other people aren’t going to find.”
Q. What role has Bloomberg played in Rosenberg Research’s evolution?
I’ve been a client of Bloomberg for decades, so it is my prime source of information and a prime source of data. I also dial into as many interviews as possible, contribute regularly to Bloomberg video and audio programming — my favorite show is [“Surveillance” with] Tom Keene — and participate in Bloomberg symposiums and events whenever I can. My primary relationship with Bloomberg is being a customer of the information and data Bloomberg provides, but I’ve also had the opportunity to be on a lot of Bloomberg media programs.
Q. How do you see F/m evolving over the next five years, and what role will Bloomberg technology play in that evolution?
My hope is we go from being a name that you hear about because we pop up in the media from time to time, and because we did this thing called the US benchmark series, to being one of those firms that is always out there doing innovative things. We don’t want to be a one-trick pony, we don’t want to be known for taking a gamble on something that was interesting that just paid off. We want to be a regular provider of high-quality, differentiated content in both the traditional and the alternative spaces, and to continue to grow that presence.
Bloomberg’s coming along for the ride just as long as they’ll have us. It’s core to our way of acting and our business. When folks come to us and ask us what’s the secret sauce [to our success], our answer is twofold. One is that this isn’t a nine to five job, this is a five to nine job. And the other is to hire Bloomberg. There’s no real secret about that, and I don’t see that changing anytime soon.
Q. How do you ensure your firm’s content and publications stand out?
If you’re going to make money in a business like mine, you have to deliver the goods to clients who are looking to generate some sort of return out of the information you provide them. The most important thing is to stand out and dare to be different. Do not have the consensus; have a differentiated view and be able to back it up.
One benefit of my 10 years at Merrill Lynch, seeing CIOs and global fund managers from all over the world, was learning early on how important it is to be thought-provoking and to consistently play the role of an economic detective — to find the story beneath the story, and to look for things that other people aren’t going to find.
What sets Rosenberg Research apart from the crowd is that we spend a lot of time sifting through the data for one goal, which is to search for the truth beneath the veneer of the headline. The best compliments I ever received in my professional life to this day were not about making nice calls, because a lot of that comes down to good luck. Everybody should have good luck on their side, but there’s no replacement for good work and hard work. The biggest payoff [for me] when I was an analyst and economist on the sell side… was when portfolio managers and CIOs told me “I’d never thought of that before” or “That’s the first time I’ve heard that.” That’s when you know that you hit a home run .
Q. Are there any other guiding principles — besides being an economic detective, and working hard — that have set you and your firm apart?
We work in an industry where trust and transparency are so important. There are things that come down to your quality of character — like admitting when you’re wrong [and] not hiding behind a bad call. Scenario building is important, too. One thing I learned early on is that if you don’t have a plan B, you don’t have a plan. Although I am renowned for having hard views that are somewhere between controversial and provocative, you have to know when to draw the line between having a backbone and being stubborn. You have to play that gray area effectively, because in the final analysis there’s no one more important than the client. Staying in business means I have to be even more creative than my competitors. I spend a lot of time trying to identify the things that other people aren’t looking at because that is what clients in this business are going to be seeking.
I also tell my crew to be risk takers. Don’t fear failure. The most successful people that I’ve met in my life failed at least once, and the key to success is learning from the failure, so I always tell my staff, “Don’t hide from your mistakes, ever. That will come back to bite you hard. Learn from your mistakes, and just don’t make the same mistake twice.” That is the homework for success.
Q. What’s next? How are you thinking about the coming few years ahead?
What I am continuously doing, in terms of refining existing products, is finding better ways to come up with conclusions. You’re never too old and never too seasoned to improve your analytical and forecasting skills.
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