Class of 2019 NextGens

Natalie Jenkins Sorrell, deputy chief investment officer for the Employees’ Retirement Fund of the City of Dallas, earned her way onto this year’s NextGen list through successful design and implementation of the pension’s general investment strategy across the wealth of its portfolio. She joined the retirement system after beginning her career with a three-year stint at J.P. Morgan, where she focused on real estate and media M&A transactions, followed by GE Capital where she worked at GE Equity putting GE’s balance sheet to work investing in private companies.

Today, she leads the Texas pension’s efforts to delve more deeply into private real estate, private equity, global equity, and private equity. Additionally, she helped lead the development and implementation of a new operation called the Next Generation Manager Program that is dedicated to relatively small, new, and diverse funds with a strong track record that are typically overlooked by public pension plans.

Sorrell speaks with CIO about some of her fondest memories while working at the Employees’ Retirement Fund, and how she’s leading the portfolio for anticipated headwinds in the near future.


CIO: What makes 2019 an interesting investing climate? How are you handling it?

Sorrell: Market volatility is keeping things lively, no question. Geopolitical tensions also warrant some near-term concern; however, the underpinnings of the economy remain strong—for now.  Right now, it feels like a waiting game—waiting for the headline risks to fade. In general, we simply want our investment managers to stick to their knitting, continue managing our assets as we expect them to, and remain very risk-aware. We are managing the environment by doing what we have always done—focus on asset allocation, including return, risk, and liquidity.  Patience will likely be rewarded in this market. Sudden shifts in allocation, less so.  

CIO: After this year, what are the largest opportunities and the largest threats you see on the horizon?

Sorrell: As the economy is expected to remain relatively strong in the short to medium term, my concern is that inflation will pick up, driven mostly by wages. The market may be overreacting around all the geopolitical issues, so now might be a great time to look at EM.  Long term, I still favor sectors like financials, although the ride there and in a few other areas has been choppy.

The main threat I see right now is that people become more concerned with managing the headlines of the day than they are about managing their businesses. I sincerely hope that governing via levying tariffs does not become our long-term diplomacy strategy. I remain hopeful in due time that some of the saber-rattling will subside and perhaps then we will see a return to more normal market movements and less choppiness.

CIO: How did you arrive at your current position? And why did you choose this part of the financial services industry?

Sorrell: My interest in the industry began in college with an investment banking internship through SEO (Sponsors for Educational Opportunity). This was not only a great introduction to financial services, but also solidified my interest in and commitment to learning more about the space. I am also honored to be a Robert A. Toigo Fellow—this Fellowship was incredibly helpful as I matriculated through Wharton, with not only the Fellowship itself, but also the immeasurably valuable network of professionals and alums throughout the world. After starting in investment banking and gaining experience in private equity, I relocated to Dallas for an opportunity with a small start-up publishing house after working at The McGraw-Hill Companies. While there, I met the executive director at ERF Dallas and 13 years later, here I am. 

I start with SEO and Toigo because I credit both with helping me begin my journey in financial services, asset management. I believe I did not choose my path, it chose me. I was fortunate enough to have exposure to these amazing organizations, their networks, and alums at a critical juncture in my career development. This is a big part of why I am in the industry I am today.

CIO: What was the most important strategic allocation of your career?

Sorrell: It is likely a tie between creating an allocation to both private equity and to private real estate. Both have been pivotal as we have dealt with the new market realities since the Great Financial Crisis. Also, because they are both long-term in nature, manager selection here has been critical. 

CIO: Tips for money managers who want to work with you, especially what not to do.

Sorrell: If you send me an email, please know my name. And how to spell it—that really helps.  Cold-call emails are tough, may want to avoid those if you can. I tend to talk more with managers that have products in areas where we are currently considering an allocation. Finally, rudely interrupting a conversation at a conference, and sending three megabyte-plus sized emails, not my preferences.

CIO: Biggest goof a money manager has made with you? 

Sorrell: Sending me an email calling me either Nancy or Nicole. Or Sir. These never get old.

CIO: Who in the financial world would you like to have lunch with and why?

Sorrell: Most likely Jaime Dimon, and Robert Smith. Both have built formidable businesses and have shown a commitment to improving them in a very methodical fashion. I have admired for quite some time how they have clearly worked hard, but efficiently. They have also been able to significantly expand their footprints yet stay nimble.  If given the opportunity, I would speak with each of them about how they have built their teams, how they manage them, and continually provide them autonomy. I would also ask them about the multigenerational workforce and get their thoughts on how they plan to manage this population going forward. Essentially these are both two incredibly successful people who have many business, and I would also guess, life lessons to impart. 

(I would also have to ask Jamie if the book and movie “Too Big to Fail” were close to accurate…especially his casting and portrayal in the movie. Just curious.) 

CIO: What are changes you’d like to see the institutional investing community make in 10 years?

Sorrell: I would like to see more women and under-represented people of color in this business. It is long overdue. Honestly, I do not understand why we are still having conversations around diversity and inclusion. More women and people of color, particularly under-represented people of color, should be “included” by now. The tone around this issue must both be set at, and come from the very top, and it would appear that is what has taken the longest to occur.

CIO: What are your hobbies not correlated to work?

Sorrell: Love to: spend time traveling with my family; enjoy reading good fiction novels and health journals; get on a Peloton bike and spin for an hour; and, be silly with my 9 and 4-year olds. And, of course, date nights with my husband, Michael—a must.