Transcript

Asim (00:13)
Welcome to the Careers in Finance podcast at CFI. I’m Asim Khan, and I’m joined today by James Binsfeld. James, welcome to the podcast.

James M. Binsfeld (00:23)
Thanks so much for having me. I’m delighted to be here.

Asim (00:26)
We’re excited to have you. We love talking to large buy-side asset managers. You’re with the Chicago Teacher’s Pension Fund, is that right?

James M. Binsfeld (00:37)
That’s right.

Asim (00:38)
And tell us about the fund. It’s obviously for Chicago teachers’ pensions. About how big is the fund?

James M. Binsfeld (00:46)
Yes, so the Chicago Teachers Pension Fund serves roughly 94,000 participants or beneficiaries. And it’s a multi-billion dollar pension fund, I believe just north of 12 billion currently.

Asim (01:01)
Nice. And which asset classes do you look after?

James M. Binsfeld (01:06)
So, I’m responsible for oversight of the US equities asset class as well as private credit. And then I also run what we call our First Friday program, which is an educational forum for diverse and emerging managers, which is across all asset classes. So, I’m also responsible for helping to source prospective managers across virtually every asset class

Asim (01:33)
That’s extremely interesting. And have you been at Chicago Teachers very long?

James M. Binsfeld (01:35)
for us to take.

I joined the Chicago Teachers Pension Fund in January of 2018, so I’m approaching my six-and-a-half-year anniversary.

Asim (01:48)
That’s great. And if you give us a bit of a background, how did you start? Did you have a degree in finance or accounting? How did you end up on this track?

James M. Binsfeld (02:01)
Yeah, great question. So, I graduated from the University of North Carolina at Chapel Hill, the Keenan Flagler Business School. I had a concentration in finance.

After that I had an internship with Wells Fargo here in Chicago. I proceeded to work at Bank of America, which was really in the backyard of North Carolina, being based in Charlotte. So I worked here in Chicago with the global corporate and investment banking division, working more particularly with the sales and trading division for global derivatives, helping support their operations globally.

And then after that, I really had my first foray into the investment management world, which I’m doing today. I worked with West Path Investment Management, which is the asset owner for the United Methodist Church. I worked there, served the agency for almost seven years. And then after that, I worked for NASDAQ, based obviously in New York City, and helped with their global advisory services, conducting perceptions

studies across many of the same investors that I dealt with at West Path and then I went back into investment management, happy to say, and I’ve been here with Chicago Teachers ever since.

Asim (03:28)
That’s quite a path. I mean, you’ve been on the transaction side, the operation side, and now you’re on the buy side. So one of the asset classes that you’re looking after, you said, was private credit, right? And…

James M. Binsfeld (03:42)
That’s it.

Asim (03:43)
it’s been a lot in the news lately. What’s your view on it? Do you think it’s kind of a risky place to be or do you see it as a place of opportunity for investment dollars? I know at high levels, Jamie Dimon and folks at Goldman, they’ve had really kind of different views about the asset class. They’re all heavily involved. So what’s your take?

James M. Binsfeld (04:14)
Yeah, it’s a great question. Private credit really is the flavor of the day. So we have an RFP currently underway, so we’re in the quiet period. But at a very high level, we have a 3% allocation to the made-in asset class of private credit. And it’s really serving as an additional portfolio diversifier for us to enhance expected return while correspondingly lowering

risk across the portfolio. So when you kind of think back to modern portfolio theory, which I studied at the University of Chicago, I did my CEMA, my Certified Investment Management Analyst designation through Chicago Booth here. That was one of the major tenants and that definitely has proven to be the case. We had our investment consultant, Kalan, help us run an asset allocation study across various scenarios and the Sharpe ratios were

much higher by including private credit within the overall context of our portfolio.

Asim (05:16)
And are these, I don’t want to be a credit geek and get too much into the weeds, but were these, or are these credits, are they rated by S&P and Moody’s? Or are they rated like insurance company credits by NAIC? Or how do you assess the credit quality third-party-wise?

James M. Binsfeld (05:34)
Yeah, so these are private credits, so they’re not being obviously rated by the big three public credit rating agencies of Moody’s, S &P, and Fitch. So we’re looking for some really great best-in-class managers to really assess that and do the requisite sourcing, underwriting, and monitoring across that. So we’re definitely…

in the due diligence phase right now, trying to assess and find the best managers in the world.

Asim (06:10)
I see. I get what you’re saying. You’re not looking at individual credits, but your investment dollars are going to, for example, a Blackstone or an Apollo, somebody of that ill.

James M. Binsfeld (06:21)
Yes, they’re third party managers that we have kind of an RFP in the quiet period, but that’s kind of how we run things with external asset managers. And then we provide the requisite due diligence here at CTPF to kind of assess, find those best managers, best in class asset managers that are out there. And that’s really how we run the program.

Asim (06:51)
Okay, I understand. And you mentioned that you have a SEMA certification. That’s great. Have you dabbled in any of CFI’s courses or certifications?

James M. Binsfeld (06:57)
Yes.

Yes, I have. And also, during the pandemic, I earned my Master’s of Science in Finance, a graduate degree from the University of Notre Dame. So actually, one of my…

classmates, he did the Financial Modeling and Valuation Analyst Certification. So that’s really how I got to know CFI, I would say, dating back to 2021. So yes, I’ve really enjoyed all the great work that you have done at CFI and training, you know, finance and banking professionals.

Asim (07:40)
Well, we like hearing that. Thank you very much. So you’ve had quite an interesting career, a long one, a successful one. This podcast, and I would say, you know, a good portion of our membership consists of university students or people just kind of starting out in the financial world. If you could give, and I hate to put you on the spot, but just three pieces of advice.

Whatever you think is germane to those starting out, what would you tell them?

James M. Binsfeld (08:16)
It’s a great question. I would say just try to always be a lifelong learner. Learn every single day. You obviously have a multitude of courses at CFI. I’ve done to date over 140 courses. You know, I’ve earned the…

three designations. I’ve done the Capital Markets and Securities Analyst Certification Program. I’ve done the Commercial Banking and Credit Analyst Certification Program, as well as the Financial Planning and Wealth Management. So with, really, with the resources that you provide, you know, I would say if you could start working on those certifications, obviously the, now you have the learning paths as well,

any of those. Those are just great tracks, you know, to start taking courses with the best-in-class online training that you guys provide.

So I would say, first and foremost, just continue to learn every single day. If you can take a course, you know, once a week, great, depending on, you know, things going on in your life with work -life balance. I would read as much as you can, you know, with various publications, whether that’s the Financial Times or Barron’s or the Wall Street Journal. Just read a lot of industry publications. And then thirdly, I would try to align yourself with a mentor

or a sponsor that you can develop a great relationship with and learn from their guidance, learn from their experience. So those are the three things I would say.

Asim (09:55)
Excellent. And then, just in closing, so is there a favorite CFI course that you’ve taken?

James M. Binsfeld (10:03)
Boy, where do you start? They’re all great.

Asim (10:05)
I don’t know, but it’s okay. Well, thanks for that endorsement. James, thank you so much for your time. Good luck with everything you’re doing. It sounds incredibly exciting. And we’d love to have you back on the podcast. So if anything comes up of interest that you’d want to share with us and our learners, please let us know and we’d love to have you back on.

James M. Binsfeld (10:31)
I’d be happy to. Thanks so much again for having me on.

Asim (10:34)
Okay, until next time.

James M. Binsfeld (10:36)
Bye for now.