Alex + Andrea: We are delighted to present a special interview with a remarkable individual who has left an indelible mark on the world of finance. Karen Finerman, the CEO of Metropolitan Capital Advisors, has not only navigated the tumultuous seas of Wall Street but also generously shared her wisdom through her New York Times best-selling book, “Firemen’s Rules: Secrets I’d Only Tell My Daughters About Business and Life.” She is also a well-respected regular panelist on CNBC’s Fast Money.

Karen Finerman is not just a finance luminary. She is deeply committed to philanthropic causes, including Parkinson’s research and women’s financial empowerment. Today, we are honored to engage her in an in-depth conversation about her journey, her invaluable insights, and her ongoing impact in both the financial and philanthropic realms.

The Journey into Finance

Alex + Andrea: Karen, your journey in finance is indeed remarkable. Could you share some key lessons from your book, “Finerman’s Rules,” which you believe are most pertinent for aspiring entrepreneurs and investors?

Karen Finerman: Absolutely. “Finerman’s Rules” essentially chronicles my personal journey into Wall Street. I was fortunate to have a passion for finance from a young age, and this early clarity was a significant advantage. Upon entering Wall Street, I immersed myself in various aspects of finance and found that becoming an expert in a particular area was vital.

For me, that area was Options trading. I was deeply passionate about it, and the intricacies of Options fascinated me. It’s crucial for aspiring entrepreneurs to find an area they’re genuinely enthusiastic about and put in the hard work to gain expertise. In addition, learning as much as possible is key, as is adopting a long-term perspective when dealing with financial matters. While my appearances on Fast Money may suggest otherwise, I’m a firm believer in long-term investment and staying steady through market fluctuations.

Alex + Andrea: Karen, in your role as the CEO of Metropolitan Capital Advisors and a prominent panelist on CNBC’s Fast Money, you’ve expertly steered through various economic cycles. What advice would you offer individuals seeking to make prudent investments in today’s dynamic landscape?

KF: In today’s complex financial landscape, adopting a dollar-cost averaging approach can be immensely beneficial. This method eliminates emotional decision-making, which often leads to counterproductive choices. It’s important to recognize that our gut instincts are not reliable indicators. By adhering to a predetermined investment strategy, you can mitigate emotional responses.

Having well-defined rules and maintaining discipline in adhering to them is also crucial. I advocate for a long-term perspective, and despite my appearances on Fast Money, I prioritize withstanding market fluctuations.

Empowering Women in Finance

Alex + Andrea: As a co-host of the Money Investing Takes Club for Women, could you share strategies and insights that are particularly effective in empowering women to take control of their financial futures, which can sometimes seem daunting?

KF: Empowering women in finance is a mission dear to my heart. We understand that investing can be an intimidating concept for many women. In our club, we aim to simplify the idea of investing and impart essential knowledge. We educate on topics ranging from how I approach investments to the utility of Exchange Traded Funds (ETFs) as accessible tools.

In addition, we emphasize the significance of distancing oneself from emotional decision-making. I share personal mistakes and lessons, notably the error of basing selling decisions on the purchase price, which is an irrelevant factor. We provide guidelines for making informed selling decisions, often tied to substantial changes in strategy, leadership, or external factors. ETFs are seen as a practical gateway into investment, lessening emotional decision-making.

The Role of Education

Alex + Andrea: You studied at Wharton and currently serve on its board. Can you share more about your role and your activities on the Wharton Board?

KF: I’ve been privileged to serve on the Wharton Board for approximately five years. Wharton holds a special place in my heart, and I cherish the network and knowledge I’ve gained from this esteemed institution.

At Wharton, I co-teach a course on “Women in Leadership” with the brilliant Adam Grant. It’s a rewarding experience, helping the next generation of leaders navigate the complexities of leadership. Additionally, I’ve established a course as part of the M.B.A. curriculum that focuses on understanding and managing risk. Risk is a topic that I believe is not given enough attention. We cover various dimensions of risk, including corporate, financial, market, credit, lifestyle, health, and career risks. Our approach is holistic, preparing students to navigate the multifaceted world of risk.

Balancing Philanthropy and Business

Alex + Andrea: You have dedicated yourself to philanthropic efforts, particularly in Parkinson’s research. Could you share your passion for this cause and why it holds a special place in your heart?

KF: Parkinson’s disease is a profoundly cruel and insidious affliction. It not only steals loved ones from us but does so gradually. My father suffered from Parkinson’s, and witnessing the disease’s relentless progression was heart-wrenching.

Consequently, Parkinson’s research is a cause I hold dear. I’ve collaborated with the Michael J. Fox Foundation, a remarkable organization committed to finding a cure. Importantly, a breakthrough in Parkinson’s research could potentially hold the key to treatments for related conditions like Alzheimer’s and ALS. By supporting this cause, I hope to make a substantial impact in the world of medical research.

Future Plans

Alex + Andrea: What future projects or initiatives, whether in the financial sector or philanthropy, are you excited about?

KF: I’m enthusiastic about the financial education program for young girls we’re developing. It’s an endeavor close to my heart, and I’m hopeful it will positively influence these young women’s financial empowerment. The financial landscape is continuously evolving, particularly with the information explosion facilitated by the internet. The deluge of data can be overwhelming, making it essential to manage information effectively.

Alex + Andrea: Karen, it has been a privilege to engage in this conversation with you. Your insights, both in finance and philanthropy, are truly inspiring. Thank you for sharing your experiences, wisdom, and your dedication to making a difference.