Alumni feature: Roger Collison

The stock market crash that started it all

Alumni Roger Collison reflects on his learnings and the 1987 stock market crash that inspired his career

Written by Karen Ho

If there is one piece of career advice Roger Collison has for graduating students, it is that university is just the beginning of lifelong learning. “Completing your degree should be the start to a journey. It opens a great number of alternatives both in terms of careers and in terms of opportunities for further knowledge gain,” Roger says.

Currently the Chairman and Director of DMX Corporation and DMX Asset Management, Roger graduated from the University of Sydney with a Bachelor of Economics (Honours) in 1989. Since then, he has completed an MBA from the Australian Graduate School of Management (UNSW), two graduate diplomas in both Applied Corporate Governance and Applied Finance, qualified as a Chartered Financial Analyst and is currently studying towards his second MBA from Chicago Booth. That is not to count numerous other professional body qualifications. “One thing I took away fromthe University of Sydney was the importance of further studies as it is from these that you can keep up with the new young trainee and the latest big insights.”

Before selecting his first degree, Roger was like many other high school graduates. “I was not very clear what I wanted – I knew it was not medicine (my family’s preferred career path) and probably had something to do with business.” He distinctly remembers meeting Judith Yates (now Honorary Associate Professor at the School of Economics) during his orientation. It became clear from their conversation that his ambitions and priorities would be the language of business. All three topics that Roger eventually studied at university – economics, accounting and law – would become strong foundational subjects for his career.

After graduating, Roger worked in accounting at PwC, consulting at McKinsey and at Accenture as an analyst, eventually becoming Director of Credit Suisse. In 2006, he became Head of Research and Fund Manager at Tyndall Asset Management before later moving to DMX Corporation and Asset Management.

A significant event that Roger remembers as an undergraduate student was the October 1987 stock market crash. The experience would go on to cement his decision to be involved with the markets. “The “chalkies” used to write the bid/ask quotes on the white board,” Roger recalls. “I was fascinated by the range of emotions displayed - both in the pit and in the visitor’s gallery. I remember one old man holding up a big sign to the glass wall “Don’t Panic!”, which was of course exactly what everyone was doing. This was the biggest oneday fall (in percentage terms) since October 1929. A real experience. I still have framed copies of the newspapers reporting on the two downturns. These serve to remind me, every day, that the next big down day may be just around the corner.”

One of the most important lessons Roger would come to understand about the markets was the importance of behavioural economics in human decision-making. “In 1987 the subject of behavioural economics was just in its infancy. Daniel Kahneman and Amos Tversky had set out Prospect Theory less than 10 years earlier and their ideas were still not mainstream, but I was clear that this was an important step forward for the profession and I could see that it had direct application to business.” As part of his MBA at Chicago Booth, Roger furthered his knowledge in this area after taking a class on behavioural economics taught by Nobel Laureate, Richard (Dick) Thaller who is famous for authoring the book, ‘Nudge’. Roger is now incorporating behavioural economics into his latest venture, Fitzroy Value Fund which is a start-up aiming to trade on information and insights based around human misjudgement and behavioural economics.

Reflecting on the current economic climate, Roger is aware of how much of a challenge COVID-19 will be to the Australian and world economy. His prediction is that there will be bankruptcies and general weakening in corporate and individual confidence. In terms of the markets, Roger says, “Being a value investor, I always become more excited and animated when there is market weakness, as we have now. There should be huge opportunities in the market now. The task for me, and my team at DMX, are to identify the best prospects.”

After 25 years of investment experience, Roger shows no signs of slowing down as he continues his training for what will come next. His advocacy for future study is clear and he urges students to continue learning – regardless of location. “I have qualifications from the US, Europe, and Australia. My current degree is from a US university but is being taught in Hong Kong.” Beyond the continuous learning, it was only fitting Roger noted the greatest significance from his time at university, “My recollections of this period would be incomplete without mentioning that I met the lady that would become my wife, Elizabeth, at the end of first year and that we will be married 30 years later this year.”

Image courtesy of Roger Collison