BlackRock's Jay Jacobs on why a long-term mindset is key to success

Since heading up BlackRock’s US thematics and active equity exchange-traded funds (ETFs) division in April 2022, Jay Jacobs has spearheaded the asset manager’s research and development of investment megatrends.

One of the biggest themes that the fund expert is watching is the ‘great acceleration’: the idea that an increasing number of exponential growth opportunities are emerging in the thematic space as the pace of change accelerates.

The three different areas that are part of this overarching theme are the industrial renaissance, the power of the purse and the upshot of post-Covid-19 medicine. He explains that the power of the purse is about the rising consumer, which has been driven by the growth in the buying power of millennials and increasing consumption in emerging markets.

The industrial renaissance, meanwhile, encompasses the increasing investments in the digitalisation of supply chains to deal with rising manufacturing demand. Within this theme, Jacobs is most excited about the infrastructure, automation and robotics, and electric and autonomous vehicle (EV/AV) spaces.

1: What’s the top mistake that investors make?

Being too short term, instead of looking at the long term. A lot of people think that they can outsmart the markets. The reality is that the markets tend to be very challenging to compete in. Even the most sophisticated institutional investors struggle to compete in a short timeframe.

2: Who or where do you go to for investment or economic insights?

We read the major publications — the Financial Times, Bloomberg, The Economist. But, what I really love, on the thematic side, is some of these more specialised publishers that don’t get as much attention. Benchmark Mineral Intelligence does a lot of great research on lithium; The Robot Report; the Consumer Technology Association puts out a lot of fantastic studies on consumer electronics.

3: What’s the most memorable moment from your career so far?

One that sticks out to me is putting the ‘global’ in Global X. I had a meeting in Bangkok with a few investors and realised that the only way we were going to make it was to hire a tuk-tuk. Weaving in and out of Bangkok traffic in the 100-degree weather, I had kind of an out-of-body experience and thought ‘wow, we’ve come a long way as a firm and truly have entered the global stage here’.

4: What top tip would you give to your younger self?

I would encourage any young financial professionals — and it sounds simple — to say yes to any opportunity that comes to them.

5: What’s an investor’s best source of alpha?

The greatest source of alpha is having a long-term time horizon.