Helping Investors Succeed is Music to Their Ears

Equitas Awards Group
Equitas team, center David Thomas

Observing that investment markets have been on a bit of a wild ride in the last few years definitely demonstrates a keen grasp of the obvious. Impatient, impulsive investors in particular have taken some big financial hits.

“Very few people have adopted the learned skill of living through the downturns,” said David Thomas, founder and CEO of Equitas Capital Advisors, LLC. “In 2020, the market was down 35% in twenty days, yet we climbed out of that bear market quickly.”

Equitas Capital is celebrating twenty years in business this year, and having patience, seeing the big picture, has been central to its success. Also vital is the fact that the firm consists of independent, local financial advisers.

“The objective of Equitas has always been to provide investment solutions for all our clients,” Thomas elaborated. “We are a service provider, we don’t sell anything. We help clients analyze, identify and realize their investment goals.”

Related to this, Equitas serves as a fiduciary for its clients. This includes entering into a signed, formal agreement with each investor, stating that the firm will always do what is in that person’s best interest.

“You have someone who goes in with the investment solution in mind, not a product to sell,” said Thomas. “Along with being independent, this removes some of the potential conflicts of interest that large companies can have.”

Thomas worked in the investment field for twenty additional years before founding Equitas, and he has seen some changes in his times.

“One of the biggest changes is speed,” he noted. “Information is disseminated quickly, so markets can move quickly. Everything is compressed.”

Technological advances are also a big factor. “We spend a lot of time on the technological side of the market. Many trading systems are now based on algorithms. AI is coming, though it’s not here yet. But if computers are beating humans in games like chess and poker, how long will it be before they can beat the best portfolio managers?”

Of course, computers are not yet at a point where they can truly understand human nature – which is what Thomas sees as the biggest constant over his career.

“Human nature hasn’t changed in 6000 years of human history,” he commented. “Primal fear and greed still motivate people. The fear side is probably double the weight of the greed side for most investors. It causes them to sell at the bottom. They want to make money but they don’t want to lose money, which creates a lot of volatility in the market.”

Indeed, Thomas believes that risk management is the most important thing for any investor to understand. “It’s the only thing you can really manage,” he pointed out. “Everything has risk.”

That Equitas is very good at this is evidenced by the fact that, along with twenty years in business, the firm is also celebrating two national awards it won for its work last year. First and foremost, Equitas’ Evergreen Fund was named the best performing fund in the United States last year, and placed in the top ten worldwide in the Bloomberg database.

When not putting together investment strategies for his clients, Thomas immerses himself in another very creative field.

“I worked my way through college as a professional musician in Nashville,” he recalled, acquiring degrees in music and business along the way. “I loved working in music, but I realized my career path was leading to being a side man at the Grand Ole Opry. I wanted more, and that’s when I dusted off the business degree.”

However, Thomas still performs, writes, arranges, and produces music, across genres as diverse as country, jazz, reggae, and rock. He has a band that includes one of his sons who also works for Equitas, and they have recently been in the studio working on a new album.

“You never get music out of your blood,” he said. “I’ve tried transfusions. But it does have some parallels to the investment industry. It’s that creative side, engineering a solution that doesn’t presently exist.”

Whether writing a song or preparing a client’s investment strategy, Thomas brings a mindset of enduring success to the task.

“When we started Equitas, I wanted to build a company that could work through the decades,” he said. At twenty years and counting, there will undoubtedly be many more memorable performances to come.

 

Categories: Neighborhood Biz