“MMBB was lucky enough to lure [Matt] away from the hedge fund industry where he had been managing significant assets. At this point, Matt’s experience encompasses the construction of a variety of equity and fixed income asset classes, as well as the operational and legal considerations attendant to them.”
— Candace Cox, CIO, MMBB Financial Services
Dr. Matthew Sherwood is the chief of manager selection and allocation at MMBB Financial Services for all strategies, and gained recognition for generating strong returns across a variety of different asset classes in the portfolio. As director of public markets investments, he’s primarily responsible for portfolio construction and deploying capital through derivatives, illiquid assets, and external money managers.
He previously aspired to be a Wall Street tactician and worked at a number of different companies in the sector before switching to the religion-based investor—including work as a portfolio manager at the Schonfeld Group and Access Global Partners. He then worked as an adjunct professor at Columbia University in New York where he was a guest lecturer on the global financial crisis, shorting, and asset allocation.
In 2018, Sherwood published the first textbook on environmental, social, and governance (ESG) investing, titled Responsible Investing. Sherwood’s efforts landed him a position in this year’s NextGen roster because of his diversified experience as an investor and an eye for navigating through stiff investor markets with a positive portfolio.
CIO: What makes 2019 an interesting investing climate? How are you handling it?
Sherwood: 2019 has certainly been an interesting investment landscape because of the trade tensions with the US and China. Although political uncertainty is difficult to manage, and such risks are unpredictable, I have been handling this environment by closely engaging with MMBB’s external managers to understand their views and portfolio positioning. I have also been continuously educating myself on the day-to-day economic data, market research, and price action to be best informed on this ever-changing climate.
CIO: After this year, what are the largest opportunities and the largest threats you see on the horizon?
Sherwood: As an investor, I believe that no one is smarter than the market, but the smartest investors learn from the market and price risk accordingly. It is with that lens that I identify relative attractiveness of European equities and companies insulated from the US-China trade tensions because these opportunities appear to be implied through the skew of the equity options market. Additionally, I believe opportunities exist in countries that will benefit from supply chain and logistics transitioning from China, such as Vietnam and Mexico. I feel that global growth is threatened by the uncertainty of the impact of current, and potential future, tariffs between China and the US, as well as the potential for volatility, e.g., devaluation via monetary policy, in the foreign exchange market.
CIO: How did you arrive at your current position? And why did you choose this part of the financial services industry?
Sherwood: I joined MMBB because I was attracted to the opportunity to serve the members, namely ministers and missionaries, that MMBB serves.
CIO: What was the most important strategic allocation of your career?
Sherwood: In my earlier hedge fund days, in the spring of 2008, I reengineered my portfolio to be long gold, short the Australian and New Zealand Dollar and short the UK banks. These positions benefited me throughout the remainder of 2008 and enabled me to end the year up 18% in a year where the broader equity market indices were down around 40%.
CIO: Tips for money managers who want to work with you, especially what not to do.
Sherwood: I appreciate when money managers who are soliciting business are direct and to-the-point regarding their strategy and value proposition. I want to learn about all strategies, but I only have so much time.
CIO: Biggest goof a money manager has made with you?
Sherwood: Being legally blind, I am blessed to have a guide dog. One day, when meeting with a money manager who requested a meeting with me, the manager said, “That’s great that you have your dog at work.” My dog is a beautiful black Labrador Retriever. I recall responding, “I am very lucky.” He then followed with, “So, does that mean you drive to work?” I then chuckled and said, “Yes, a Black Labraghini.” I then told him that I am blind, and the dog is my guide dog. He had an ah-hah moment when he said, “Oh, that’s why he has the harness that says service dog.”
CIO: Who in the financial world would you like to have lunch with and why?
Sherwood: Chris Ailman from CalSTRS, as I really enjoyed his acceptance speech when he won a Lifetime Achievement Award at a 2017 awards dinner. I have a lot of respect for him and I am sure I could learn a lot from him.
CIO: What are changes you’d like to see the institutional investing community make in 10 years?
Sherwood: Broader acceptance to innovative technologies that empower greater access to information and risk management analytics.
CIO: What are your hobbies not correlated to work?
Sherwood: I am a fan of sports, especially football.
