Episode 43 | A Conversation with Laura Null on Student Investing and Risk Management

In Episode 43 of “Market News with Rodney Lake,” Professor Lake, Director of the GW Investment Institute (GWII), interviews Laura Null, a graduating senior from GW’s School of Business majoring in finance and minoring in statistics. Drawn to the “chaos” of trading, Laura quickly immersed herself in the GWII to make a real impact with real capital. She reflects on her transformative experience in the Applied Financial Security Analysis class, equipping her with hands-on skills in financial modeling, stock pitching, and fundamental company analysis. Laura emphasized the importance of discerning short-term market noise from long-term trends and understanding that markets are forward-looking. With an eye toward aggressive growth and long-term wealth building for the GWII, she advocates for leaning into informed views, acting on conviction, and maintaining liquidity to avoid emotional decision-making, always intending to outperform and sustain the fund. 

Transcript

Rodney Lake
Thank you for joining “Market News with Rodney Lake.” This is a regular program for the GW Investment Institute where we talk about timely market topics. I'm Rodney Lake, the Director of the GW Investment Institute. Let's get started. Welcome back to “Market News at Rodney Lake.” I'm your host, Rodney Lake. Today we have a special guest. It is one of our very own students, Laura Null from the GW Investment Institute and GW School of Business and overall GW.

Rodney Lake
Laura, welcome to the show. Thank you for being on this. Such a delight. We are thrilled that you're here. We know that you're senior and graduating this semester, so we're absolutely thrilled that you took the time to come on to the show. And you're obviously working with us this semester. We're going to talk a little bit about that on the show, but please introduce yourself more fully and let us know why.

Rodney Lake
You know, you're interested in finance to begin with.

Laura Null
Yeah. Of course. Well, thank you so much for having me, Professor Lake. It is great to be here. I'm Laura Null, I'm a graduating senior here at George Washington University School of Business, originally from outside Philly, but I came here to pursue my degree with a major in finance and a minor in statistics. I've always known I wanted to do finance.

Laura Null
Growing up with a father in finance, Bloomberg TV was basically the soundtrack to my childhood. So this is about my first step to my Bloomberg moment here. But I love how everything can change at a second notice. Like being able to figure out what to do every day, depending on whether the market's up, whether the market's down.

Laura Null
Really like that chaos drew me into trading. So when I got here at GW, I immediately got involved with the GW Investment Institute because early on, I want to not play on a simulation and play on my computer. I wanted to be able to have real impact with real money, with real consequences. So that was extremely fantastic.

Laura Null
That I got to get involved with that so early.

Rodney Lake
Excellent. And so we're going to talk about you're working on an independent research project for us this semester. So thank you very much. But before we get into that, you've been involved with the Investment Institute for a variety of different things. One is the stock pitch for your class. Could you talk a little bit about that for us and maybe some of the takeaways from that class?

Rodney Lake
So for people, that are watching that are maybe interested in, in our classes are a, potential student who's interested in taking one of our classes. Could you give maybe the highlight reel, of, you know, your experience?

Laura Null
Yeah. Of course. That was honestly one of the most rewarding classes I've taken here at GW. So probably the most work, but also the most rewarding. But I took the Applied Financial Security Analysis class my spring of my junior year. And honestly, I got like the exposure to the real work that I knew happened by never actually been able to do, like working through Excel, financial modeling, working through DCFs, and being able to put it together into a stock pitch was something that I knew I had to do eventually, but I never actually been able to do it.

Laura Null
The other big key takeaway is like learning how to fundamentally analyze a company and come up with an investment thesis. I remember so many times that Professor Song would always tell me, like, those risk factors, like those are idiosyncratic risk factors. And it's like, I don't I don't even know what that means. But I realized a lot of things that people say a lot, like that are normal to the whole market.

Laura Null
You know, that doesn't really matter when you're talking about individual companies and when you're talking about an individual portfolio. So it really shifted my view on how to analyze companies, but also it shifted my view, like professionally, on how to be able to present, put together materials and, just be able to like, conduct professionally in a financial environment.

Rodney Lake
Well, I think that's great of you. Shout out to Professor Song there. Thanks very much. And the reason I'm asking is because, you know, students come through our classes, and I just wanted to hear from a student. You know, what, what is your takeaway? So that's I think that's wonderful to hear. That's obviously what we're trying to do, is to instill those skills and those techniques with our students.

Rodney Lake
So this semester, shifting gears a little bit, you're working on a project with us. That's around risk and risk and analytics. Could you talk a little bit about that?

Laura Null
Yeah. So I once I finished that class, I really saw an opportunity for myself to kind of delve into a little bit more deeper of the details of the student funds across the board. I was, you know, thinking while we got, you know, from 1 million to 10 million, that's great. But how do we get from 10 million to 100 million?

Laura Null
That's our next biggest move. And in my mind, I saw it.

Rodney Lake
Thanks for saying that, by the way. That is the goal.

Laura Null
Course. In my mind, I saw it as like how we were doing it with the students was a really big risk factor. And throughout the semester, I've realized that that's not our biggest risk factor. Like, that's how we got here and that's what's going to take us home. So I think that was really interesting. I've kind of just delved into a lot of different risk techniques, from, you know, derivatives to cash and also just like fundamental analysis.

Rodney Lake
Excellent. And so, you know, we talk about risk and you mentioned a little bit, about the way that the portfolio is constructed and what and we'll get, a little bit more into that. And now you're seeing the market really be all over the place. And so it's mid-April and we're recording this April 22nd. And so this, as I mentioned in another episode, could be ancient news by the time, this actually gets aired, because the market has been, you know, all over the place and has such big moves and people are paying attention.

Rodney Lake
Now you have the IMF and World Bank meetings happening right next to campus, and we can talk a little bit about that. But, you know, from your perspective, you know, what do you see as the things that, you know, we should be paying attention to? What do you see, as you know, the overall market risk from the perspective of a long term investor?

Laura Null
Yeah, absolutely. I mean, ever, more than ever. It's a constantly changing market environment. For me, the biggest thing is to be able to decipher between what is short term noise and what are long term trends. So, you know, the tariffs dominate the headlines every day. And it seems like a lot of everyday investors are starting to panic. You know, like just this morning, gold hits the brand new historical threshold of 3500 an ounce.

Laura Null
Which is crazy since I felt like it just hit 3000.

Rodney Lake
It's still on the move for sure.

Laura Null
It shows that like, people don't know what to think. However, on the flip side, the market is still showing that resilient, so no one can accurately predict what's going to happen next. But definitely the one thing I can say for sure is that it's going to be a volatile market. And what we're trying to do here is avoid the emotional decisions.

Rodney Lake
Absolutely. So one of the things that we're always trying to train our students is, you know, how do you how do you think about the good news? How do you think about the bad news? The markets are always forward looking. And for us, you know, we're absolutely thinking about, you know, the next five and ten years I mentioned this on another episode is that, you know, for an institutional investor.

Rodney Lake
So students are managing our portfolios for not the next day, not the next week or the month. It's really about where should we position ourselves in the next five and ten years. Could you maybe talk about, you know, the forward looking aspects of the market and maybe talk about, you know, the bad news, the good news and everything related to that?

Laura Null
Yeah, I mean, this classic phenomenon that the markets move ahead of the news cycle. I think a lot of people don't realize that by the time that the news already hits, you know, a lot of those things are already priced in because people try to predict that to get ahead of the curve. So obviously the markets are forward looking.

Laura Null
S&P 500 and Nasdaq posted big gains recently, even though there's headlines from tariffs, inflation, geopolitical risks. You know investors are looking 6 to 12 months ahead. So they're thinking about the future earnings growth potential. They are thinking about policy shifts. They're not really thinking about what's on today's headline. So sometimes that means that bad news can be good news.

Laura Null
You know sometimes even negative economic data, which we just saw like weaker job numbers slowing inflation can actually fuel rallies because investors try to anticipate obviously what's the Fed going to do. Right. Obviously the Fed is having a lot of pressure now from the Trump administration, to cut rates. You know, when we saw disappointing retail sales numbers that somehow still led to a big surge in tech stocks as traders, you know, tried to anticipate what was going to happen next.

Laura Null
They tried to anticipate that the fed was going to cut. Who knows? Obviously that's still definitely up in the air. And that has raised a lot of like well, they've recently been concerned right about the Fed's independence, but most likely that that's not going to be a real threat to the Fed's autonomy overall. So yeah, most people expect that the Fed will wait for clear signs right now.

Rodney Lake
And that's important. And it's important to mention and, you know, it's not unique to our central banker here. And, just today, Christine Lagarde was talking about this that, you know, central bankers get, you know, political sort of pressure, right? Because it is many times that, you know, people want lower rates for a variety of different reasons.

Rodney Lake
 And so in this case, no, no different here. But Jerome Powell, seems pretty steadfast waiting, you know, being data dependent as they talk about it, the fed for those things. And so, we'll see what happens obviously. But it seems like that is the case for the moment. So those are all excellent points. And so one of the things that, you know, we think about is, you know, risk management with all of our portfolios.
Rodney Lake
 And we talked about that. Could you maybe talk about some of the specific strategies that you've been using to analyze that the risk around our portfolios?
Laura Null
 Yeah, definitely. So as I stated, when I first started, I was honestly pretty scared. And there was only one thing on my mind: diversification. And I was focused on spreading our exposures so thin so that when all these headlines hitting the big news hits, we're not having any drastic moves. But as you taught me and as many people have taught me, like diversification is not going to get you anywhere, anywhere fast at least.
Rodney Lake
 Well, it's hard to outperform if you're overly diversified as some of the things we talk about.
Laura Null
 Right. And so as what you said is, nobody's getting rich by being a closet index. So 18 minutes to we're still very much in the aggressive growth stage. Again, getting from that 1 million to 10 million was great. But for the next 10 million, we're going to really try to lean into trading our view. We're not going to over diversify.
Laura Null
 We keep under 50 holdings. We don't have like certain position limits, but we do lean into sector trends, and we really lean into the trade that the student wants to trade. And so we're not going to, like, lean away from that just because we want to diversify because of uncertain times. But that doesn't mean that we're not analyzing in the background.
Laura Null
 Right? That's part of the class, you know, doing scenario testing, doing stress testing. What happens if the tariffs escalate further? How is that going to impact us? We might not be concerned with short term noise, but there's definitely, you know, medium term impact that could have a lot of significant impact on some of our holdings that we need to think about.
Laura Null
 The other big thing that we're thinking about is liquidity. You know, as a fund that has to have a payout. We really want to make sure that we have enough cash on hand that we're not selling at the wrong time.
Rodney Lake
 Very important.
Laura Null
 Very important, and we're not selling at the wrong time because of an emotional move. You know, we want to make strategic moves and we make moves when there's a clear evidence of a breakdown in our initial investment thesis. And that too, that causes us to, you know, rethink our position and potentially trim or potentially increase off cycle. So we're definitely monitoring the impact in the medium term pretty closely.
Laura Null
 And just trying to avoid the like day to day trade.
Rodney Lake
 That's fantastic. And want to say thanks for doing all this work. On the risk of our portfolios and that we really appreciate that. You mentioned something that is really core to what we do. One of the things that we talk about is, right, we don't want to be overly diversified. And when we find great management teams and we find great businesses, we want to let them work and we want to, you know, let them reinvest that capital.
Rodney Lake
 You know, the so-called let the winners run type of strategy. Could you maybe talk about, you know, the risk associated with this or the or the lack of risk associated with this or how people might think about this? Because some people would look at our portfolios and maybe even you initially, and you look at this and you think like, wow, that's a really big position in Nvidia, in Apple and Microsoft, in some of these bigger tech names, that, you know, really it's it's a consequence of not at cost.
Rodney Lake
 But really as these positions have grown, it's really from the growth, in the investment right now, we've been very reluctant, as you've mentioned, to trim these names because, you know, our feeling has been that, okay, there absolutely is risk to being concentrated. But there's also risk associated with being too, too diversified. Could you maybe help us think about that from your perspective.
Laura Null
 Right. Yeah. So as you said, the first thing that we want to teach students is how to build wealth, but to preserve wealth. And the only we need to preserve wealth only to sustain our operations. But on the other side, we want to be able to build wealth and that’s through outperforming. So, we're really looking for companies that can lead to compound value.
Laura Null
 You know, we're not going for the big dividend yield companies because that's, again, not part of our aggressive growth strategy. We're looking for companies that can compound just like we have you know, we've compounded 14% annually over the next over the past ten years. And we're looking to do that again. We're looking for companies like Amazon who instead of paying out really big dividend yields, are putting that back into the company.
Laura Null
 Because even though you think Amazon obviously like great management, great business model, great balance sheet, you would think that they could then pay out dividends. But what they're doing is reinvesting into different parts of the business that you don't even see. And that's upcoming and get compound growth even further, even though right now we think that's one of our biggest winners, they even have a lot more room to run.
Laura Null
 Yeah. So we're going to let those winners run.
Rodney Lake
 Now I think that's an excellent description. And I think Amazon I would just recently talk about that on another another episode is that and we talked about Amazon in a few different episodes. To be clear, again not investment advice everybody. But I think that's a great example of at scale. do these companies have these reinvestment opportunities. And when you see those for us, as you mentioned, what we're really trying to do is grow and build the wealth of the portfolio, because that's what supports our operations.
Rodney Lake
 And so if we can support more students, that's fantastic. And that's our goal. And it's also our goal to train students to outperform. Part of that reason. And just to maybe put a sound bite in here for everybody, you know, people that are listening or maybe watching on YouTube, thanks to both groups. Why do we want to do that?
Rodney Lake
 Well, I think it's really easy to train students to be the benchmark. They can buy the benchmark, and that's great. And if that's what you want to do, you know, even Warren Buffett talks about, look, if you're not willing to do the work, that's a great approach. You know, by the index Vanguard, the VOO, not we don't get anything from Vanguard.
Rodney Lake
 Although if you would like to be a sponsor, let us know, Vanguard. It's really easy to do that. It's really cheap right now. Three basis points. Some are even free from Fidelity. Also not a sponsor, but that's not what we're training students to do. We're trained them to say, hey, look for these opportunities to outperform. And that's where we can really grow the wealth, of the setup.
Rodney Lake
 So I think that's super important. And I really appreciate that you mention that. And so again, just wanted to make sure that people understood, sort of, the emphasis there. And, and that's why we let our winners run, because we think that there's the opportunity to outperform, there's the opportunity to build that wealth. And I think you described it very well.
Rodney Lake
 So thank you very much. So up next here, let's talk a little bit about you've studied a variety of different things that you obviously finance. Being at the core of that, can you talk about sort of maybe how some of the other coursework that you've done, including some of the Investment Institute courses and the projects that you've worked on, has helped you shape your understanding of risk management, especially as it relates to a portfolio?
Laura Null
 Yeah, I mean, definitely, I started off with the Applied Financial Securities Analysis class and that really like jumpstarted my spark to be like, oh, this is real. Not, you know, when I graduate, but this is real right now. So after that I got involved with the quantitative investment project. Thank you. That was really fun. That showed me like a whole different side of things, you know, that show me how all of this training can run through computer algorithms.
Laura Null
 I ended up sitting on the algorithmic trading desk for my internship. I never even would have known.
Rodney Lake
 Excellent. Great experience.
Laura Null
 And then after that, I got involved with financial derivatives. Be honest, I really didn't know a whole ton about derivatives. But, Doctor Young, I took his financial derivatives class. Futures, swaps, options I moved on to then take his graduate level class this semester in options. Which also was part of the reason I wanted to do this whole independent research project, because I saw all of the things that he was teaching us, which was like the coolest thing I had ever seen.
Laura Null
 And I was like, I want to do something like this. It's not just a textbook problem where the portfolio isn't, you know, just paper portfolio and bonds. You know, the A and B portfolio combination. And I was like, I really I could really take this. I can really do something, you know across the board with the Investment Institute, you know, will that play out.
Laura Null
 Who knows. But that's that was kind of like my playground for the whole time to be like, this is real money. Got to take all this stuff that I learned, even about derivatives, which we don't invest in derivatives currently. I was like, where are the potential growth opportunities for that? Are there growth opportunities or should we not do that?
Laura Null
 You know, either way. But I just saw that as like a whole new layer that you could add into the risk management aside from just buy/sell pitch. So that really, you know, showed a whole new world of finance to me.
Rodney Lake
 Excellent. And, you know, taking all that, you know, together. Could you maybe talk about sort of like the holistic approach to risk management that you, that you, you know, received from your time at GW? And what would you emphasize? You know, you know, to people that are watching and people that are listening for the show?
Laura Null
 Yeah, I think it just as you said, it's a holistic approach. It's not just one checkbox. I have to do this. I have to diversify to 40 holdings. I have to have this much cash. And like it also is very personalized is what I learned. You know, we're not a retirement fund, but it's right. But, you know, later down the line, my risk profile is going to drastically change than what it is right now.
Rodney Lake
 Right? You know, it depends on the client, depends on your assets, your own money, your own circumstances.
Laura Null
 Exactly. So risk management is not just one thing. It's not just one checklist. It really depends on what your profile is, what you want to get out of it. And kind of like how much work you're willing to do, but also like how much you want to see at the end, you know. So I think it it shows that like a lot of people say, you know, don't have overconcentration, but that worked great for us.
Laura Null
 We're very over concentrated in tech. But a few years ago people would have said, well, what are you doing? Right? But that, you know, showed us 14% annualized.
Rodney Lake
 So yeah. And I think you're making an excellent point here. And I think, people have to pay attention to that. And I think that's a good takeaway, is that risk management is different things to different people. It depends on your client. If you're managing client money and what their objectives are and if it's your money, it depends what your objectives are and what your timelines are.
Rodney Lake
 And so I do think it's really important when you say risk management, it's not okay. It's not a one size fits all. It's not that these risk management, you know, metrics are suitable for everyone under these same conditions because people's conditions are different, their objectives are different, their timelines are different. And so it really depends right to use a lawyer answer or an economist answer.
Rodney Lake
 But it really does depend. And I and I think that there's good lessons learned to talk about that. Now speaking of lessons learned, so we're we're getting close to wrapping up the show here. One of the things to to add, we'll ask you at the end to start thinking about is your OnlyAtGW moment. But before we get there, maybe to wrap up, this part is to talk about lessons learned and what you can share with our viewers, our listeners, about all the work again, that you've done your graduating this semester.
Rodney Lake
 I'll be the marshal at the business school ceremony, and then I'll be on the mall to celebrate you with you as well and all of our other graduates. Congratulations. Thank you. But maybe, you know, you could pull together. Maybe not everything, obviously, but pull together what you think are some of the highlights of lessons learned, not just with risk management, but investing finance.
Rodney Lake
 As you close out your time here at GW School of Business.
Laura Null
 Yeah, definitely. I think my biggest takeaway that could go for Finance, it could honestly go for life is have a view, have a view and actually do something about it, you know, have a view and have strong can have a strong conviction for that view and be able to explain to someone why all of your, you know, your strong reasoning behind it and then do something.
Laura Null
 You know, in finance it's always the worst thing is, oh, I thought about it. I thought about that five days later, published the Wall Street Journal. Not everybody.
Rodney Lake
 I didn't do anything, you know.
Laura Null
 I didn't do anything about it. And that's what really, gnaws at you. Yeah. So I think being able, especially as a young person, when sitting on an internal audit trading floor, everybody gets the exact same news. Everyone gets, you know, all the headlines instantaneously. Everyone knows everything you do. The only thing that you're bringing to the table is your view.
Laura Null
 So just like hold on to that view and trade into that view. I used to get nervous and be like, oh, well, I don't know. Maybe we should, you know, hedge against that, right? But people are like, why then theoretically then you're cutting into your own money because you're trading against your own view. So I think just being able to really.
Rodney Lake
 Have the courage of your own conviction.
Laura Null
 This and formulate it and then go for it. I think that we have as young people, we have a lot of time to recover from mistakes, but we don't have time to recover from missing out.
Rodney Lake
 Yeah, right. The errors of omission, right. As you know, Buffett and Munger talk about. All right. Now last piece of advice. And then we're going to go into your OnlyAtGW. What advice would you give to future students coming to GW to study. So anybody that's listening or watching to the show and maybe even a parent thinking about like they're sending their child here or their child is, son or daughter is here at GW, what advice could you say?
Rodney Lake
 Hey, these are some of the things that you should be paying attention to while you're here.
Laura Null
 I think it's the biggest thing is getting involved early, especially for finance students. It is getting earlier and earlier and earlier. It's almost like it's basically like sports recruiting these days.
Rodney Lake
 It is. It’s like recruiting out of high school.
Laura Null
You know, if you want to go to a big bank, you have to start freshman year. And I think I only really realized that like going sophomore year, which thankfully, you know, two years, two years ago, that was fine. Yeah. But now if you don't know, freshman year tougher, you're going to miss the whole ball game.
Laura Null
 So I think getting involved early, even things like the Investment Institute portfolio group, you don't have to take one of the classes, but you can get involved. You can learn about things, you can do a stock pitch and then you have something to talk about in your interview. People don't get involved early. You don't have anything to talk about.
Laura Null
 You know, I think the other thing with finance is really just like trading into your view, but trading in your view of yourself, you know, we're going to let our winners run. But if you think that you're a winner, you really got let yourself run. Yeah, I think.
Rodney Lake
 That's those things are both excellent advice. Get started early and bet on yourself. Exactly. And be highly concentrated with that view. Exactly. All right. That was really fantastic. Thank you very much, Laura. So to wrap here, you've given great advice and worldly wisdom. So to wrap here, please let us know what is your OnlyAtGW moment that you could share.
Laura Null
 I think my favorite OnlyAtGW moment, as you said, IMF meetings are happening right now and I get to go later in the week to have almost as many as I want to do it. That never happens. You know, being able to be a student and sit in, you know, a conference with world leaders just right next to you.
Laura Null
 That doesn't happen everywhere. That happens actually, nowhere. Except for here.
Rodney Lake
 No, it's right next to campus.
Laura Null
 And being able to go multiple years in a row and sit in on central bank meetings, that's unparalleled.
Rodney Lake
 It is a really fabulous opportunity, and I'm glad that you took advantage of it. Not everybody takes advantage of that, but it is absolutely a place at, you know, OnlyAtGW where it's right, literally right next to campus. You walk across the street, the traffic happens to be really bad today as a result. So, you know, the meetings are happening.
Rodney Lake
 But it is a great advantage for our students. And I think it is a great opportunity to take advantage of. But to your point, you got to go out there, you got to have a bias for action. So you got to go take advantage of those opportunities. Glad that you're doing that and glad you already did that.
Rodney Lake
 Great advice for everybody. Thank you so much, Laura, for the time on the show. Thank you for all the work that you've done for the Investment Institute. Congratulations on graduating from the GW School of Business and GW more broadly. I look forward to being your marshal for the business school. Thank you and I look forward to seeing you on the mall for commencement.
Laura Null
 I look forward to it.
Rodney Lake
 And that is a wrap for market news with Rodney Lake. We'll see you back on the next episode. Thank you.
Rodney Lake
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