Mr Gwi Fei Yi (Right), a civil engineering graduate from the University of Nottingham, and current research analyst at Public Mutual, is a man of many interests. We began our interview by talking about his interest in learning the Japanese language, as he had a long-standing interest in anime and wanted to gain a deeper understanding of the conversations in them. My first impression of Mr Gwi was his never-ending love for learning. In fact, he thrives on it! He got involved in the financial world as an analyst because of his curiosity to understand finance better, in combination with his belief that the realm of finance was very much interconnected with our daily lives. “When you become an adult, you’ll start to see why finance is actually a big part of your life—I took the CFA exams because my interest ties a lot with my role in Public Mutual—which is primarily to target good investment opportunities.” In addition to this, he plans to supplement his current grasp of finance by taking up coding and econometrics to keep pace with the digitalisation movement.

The Elusive World of Banking

Mr Gwi opines that as you grow and enter the adult world, it becomes increasingly difficult to neglect the relationship that finance has with your surroundings.

Every day, he religiously follows a fixed schedule which enables him to plan out his time. In the morning, he checks for news that might affect the company, ranging from economic trends, political influences, and spill-over effects from other industries. Together, these components would contribute to his evaluation of a company, where he would report his findings in a meeting which he has daily. After that, he aims to substantiate the current research he has (because it usually isn’t enough). He reasons that there is a need to expand your existing coverage of information, as missing out the tiniest of details in their scope would easily lead to consequences that are exponentially larger.

He further added that the challenge that exists for so many people in the financial world is the uncertainties they deal with every day. “The most challenging part of my work is having to analyse new information quickly. You have to account for the effects that stem from politics, changes in regulations, actions of your company and the dynamism of economic conditions. All of this alters our view of the company.” He asserts that a company can have a strong value today, but they are not immune to changes in circumstance. Every individual should take into account of all the risks in the world of banking.

Another challenge in banking would be the fleeting relationship you often have with your company. Mr Gwi mentions that in reality, their goal is to build wealth for their stakeholders; therefore, they do not have the luxury of being emotional with their decisions. Thus, regardless of their predilections, they would be forced to do medium-termed term trades, resulting in the termination of any form of relationship.

To describe the realm of banking as ‘challenging work’ would be an understatement. The reality is, a vocation in this industry requires you to be adapt at facing the ever-changing environment of finance. Stability is scarce because you would face an entirely new set of problems at the start of every day.

Aside from his role in cultivating sound investment decisions, Mr Gwi also takes pride in his capacity as a team leader. “A lot of times you only learn what you are supposed to, and when you are placed into a team you get to levy on the insights of your members. You learn things that you do not actively seek, and in that respect, you develop yourself much more”. He noted that the best investment he has made thus far, would be his investment in his team because of the knowledge he had gained through developing them. His belief in the necessity of great mentors stem from his first venture into the investment world. Coming from a science-heavy education (he pursued the sciences at A levels and engineering at university), the financial world was foreign territory to him. Luckily, he received a lot of help from his mentors, who taught him the basics of finance; and with his pursuit of the CFA accreditation, his venture into the financial field was made a lot smoother.

Obtaining The CFA  

The CFA accreditation has cultivated an infamous reputation of being arduous amongst those who are keen on pursuing a career as an analyst. Mr Gwi himself admitted that the process of obtaining the CFA was by no means an easy road. “Most of my colleagues take the CFA at earlier stages of their career. The hard part kicks in when you have to deal with the stress that comes from (dedicating) long hours after work, and (devoting) your weekends to studying. The biggest trade-off here would be the social life that I had lost”. Taking the CFA once you have started your career adds pressure to obtain a sustainable work-life balance, because the CFA requires long hours of studying (Mr Gwi estimates it to be at 300 hours for every level of accreditation). He advises that, if possible, the CFA should be undertaken when one is still in university, as it is much easier to be flexible with your time.

The fastest time in which you can complete the CFA would roughly take 2 and a half years. The first exam is available in two intakes, but the succeeding two levels are only available in a single intake in June. Digging deeper into the syllabus of the CFA, Mr Gwi states that studying the CFA draws in knowledge from a myriad of fields. Its holistic syllabus includes subjects on ethics, economics, accounts, equity, fixed income and fund management.

A person who completes the CFA would definitely garner an edge in terms of employability; nevertheless, it is an accreditation that should not be taken blindly. “An accreditation in the CFA would benefit you if you enter an industry like investment, but bears almost no merits to someone training to be an auditor. If you pursued the latter profession like the ICAEW or ACCA, (it) would benefit you more”. When considering the skill sets to attain, the conventional wisdom would be to select the ones that match with what you expect to do on the job. Mr Gwi also reemphasizes the importance of having a mentor to learn from. He found that many people enter the industry with an unrealistic view of their job, only to find out later that they don’t like it. Having a mentor protects you from falling into that situation, as a mentor has the capability to paint a more realistic picture of your work life in a particular industry.

For those who are really keen on entering the realm of finance, he recommends learning more about coding and econometrics. Every industry would be privy to the changes brought on by the wave of digitalization, and this is especially true for the financial service industry. “It started out in the developed world, where they have started to use big data, automated trading platforms and all of these will require you to know three things: How the industry works, some form of coding as well as statistical modelling”. In short, you need to constantly adapt your skills while keeping pace with the evolution of financial technology in order to be more employable.

Insights into Fintech

Fintech is inevitable; it is the future of banking”. As mentioned earlier, financial technology represents a change in the financial world, much like how every other industry is being revolutionised. A common example would be crowdfunding—a new way of amassing funds from a pool of people to fuel enterprises.  This method of alternative finance allows small and budding companies to grow their operations without relying on more traditional methods of financing like sourcing cash from bonds or stocks. These companies still have obligations to their financiers; however, compared to traditional methods, they don’t have to go through the hurdle of convincing their investors of the value of their product or service, making funds a lot easier to access. Thus, crowdfunding helps lower the barriers of entry and allows many new industries to sprout and expand.

Secondly, following the conception of microfinancing, new industries can also obtain alternative financing. “The purpose of microfinance is to channel funds into a community of businesses who need it at an affordable rate. As a result, if you have an area that needs funding, microfinance can help in sustaining a business by loaning funds”. Mr Gwi adds that this way of funding comes with its own sets of risks that are tied to the nature of the business in question, however you can always mitigate it by seizing some form of collateral or simply control the size of your lending. For instance, a big company might lend RM 100 million; however, when you microfinance a client, it would be an amount of let’s say RM 10,000, hence reducing the size of your nominal amount. To further reduce the risk, the investor could diversify its client base by loaning to different industries.

Another example of financial technology being implemented in Malaysia is the introduction of AliPay. You might have seen some remnants of AliPay in convenience stores such as 7-Eleven and MyNews. Starbucks had also released a statement officiating its implementation of AliPay to its consumers.. “From the customers’ perspective, convenience is always welcomed because you would always like it if there was a simpler channel to pay your bills, it started out with debit cards and Paywave and now with AliPay”. Mr Gwi added that it is the bank’s job to find out if the community is ready for the changes brought on to them by the introduction of financial technology, in addition to keeping up and ahead of their competitors.

In Conclusion

Throughout the entire duration of the interview, Mr Gwi constantly emphasized on the importance of reading. “The challenge I had was that I was a science student, and then an engineer. I disliked reading and was more inclined to numbers and formulas, because they led you to an absolute answer. In addition, I wasn’t required to know how to properly structure sentences because I was tasked with the responsibility to ensuring the buildings I make don’t crumble.”  The reality in the financial world is vastly different. Reading becomes extremely beneficial as a lot of the work you do in finance ties in with various industries. Opportunities for learning are always there, and there are always new areas where you could apply the knowledge you have accumulated. He sympathizes with people coming from similar backgrounds but it boils down to a singular characteristic: initiative.