Author Archives: MIT Sloan Finance Group

MIT Sloan Investment Conference 2015: Investing in a Brave New World

This Friday will see the annual MIT Sloan Investment Conference take place, after months of dedicated organization and careful planning. Part of the Sloan finance tradition, this student-run conference brings together influential individuals in the finance and investment world today to debate and discuss pressing issues in their areas of expertise.

We have themed the conference “Investing in a Brave New World”. More than six years after the financial crisis, the investment world today has fundamentally changed from the one many of us in grew up in. This has been driven by cheap money, new regulations, and the impact of technology. The aim of the conference is, therefore, to take stock of all things new in the investment world today, and anticipate what the new landscape has in store for us.

 We are honoured to have a group of incredible speakers to take the stage and guide us through the day, including Carson Block (Muddy Waters), Ben Golub (BlackRock), Megan Greene (Manulife), Jean Hynes (Wellington Management), Martin Mannion (Summit Partners), Howard Marks (Oaktree), Vikram Pandit (TGG Group), Tom Speechley (Abraaj), and Eric Wetlaufer (CPPIB). Our very own Professor Robert C. Merton will also make a presentation on his latest research. With 10 speakers scheduled from 8am to 6pm, the conference will be packed to the brim with content. We invite you to check out our website for the agenda:

Organizing such an event is no easy task. In fact, some of the relationships and planning began over one year ago in the lead up to the 2014 conference. Venues were negotiated for and booked, speakers were reached out to and enthused, and tickets were marketed and sold – and are still selling, for those interested. It was thanks to a committed team of individuals, who are passionate about finance and the opportunity to meet some of the most influential minds in the industry, that the conference has come together so seamlessly.

 It should be clear that the MIT Sloan Investment Conference is a must-attend. The insights, speakers and networking opportunities are amongst the best the conference has seen to date, and we hope you are free to enjoy the spectacle.

 Brian Liston is a Master of Finance candidate at the MIT Sloan School of Management

Tackling the challenges of governments as financial institutions

From the MIT Sloan Newsroom:

Governments not only regulate the private financial marketplace, they also own and operate some of the world’s largest financial institutions. Government agencies make trillions of dollars of loans, insure large and complex risks, and design new financial products. Yet their leaders often lack the analytical support and rigorous financial training of their peers in the private sector, and transparency is often lacking.


The MIT Center for Finance and Policy officially launched this month to address those gaps, along with other challenges facing financial policy makers.

“This is a big unmet need,” said Professor Deborah Lucas, director of the center. “To have an academic center devoted to the broad swath of government financial policies that have such an enormous effect on the allocation of capital and risk in the world economy.”

“What we want to do is to promote research that policymakers, practitioners, and informed citizens can turn to as an objective source of information when they’re thinking about these policy issues. That information often isn’t available now,” she said.

Research endeavors so far include, among others: the production of a world atlas of government financial institutions, an effort helmed by Lucas to catalog, compare, and evaluate governments’ financial involvement worldwide; a project led by Professor Andrew Lo to develop a dashboard that measures systemic financial risk; a study of the effects of algorithmic and high frequency trading, led by Professor Andrei Kirilenko; and a study of policies on retirement finance led by MIT Sloan professor and Nobel laureate Robert Merton.

Lo, Kirilenko, and Merton are all co-directors of the center.

Along with the research work, Lucas said there is also an educational mission for the center. In many cases, the center’s leaders say, financial problems could have been avoided, mitigated, or at least predicted had public sector workers had an education on par with that received by many private sector finance professionals.

“The idea is to provide the people who are working on finance within a government context with the same skillset as their peers in private industry,” Lucas said. “One reason you see a lack of finance education is because it’s tended to be a rather expensive education. And people going into the public sector may not even realize that finance is what they will need to know.”

At MIT Sloan, work at the center has already led to the creation of Kirilenko’s new course—Core Values, Regulation, and Compliance—as well as a student club on financial markets and policy.

The center began sponsoring events in October 2013, but officially launched Sept. 12-13 with the inaugural MIT Center for Finance and Policy Conference in Cambridge, Mass. More than 120 people attended the invite-only event, which featured discussions on the cost of government credit support, the costs of single-family mortgage insurance, and contagion in financial markets. Peter Fisher, senior director at BlackRock Investment Institute and a former undersecretary at the U.S. Department of the Treasury, gave a keynote talk.

The conference also included a panel discussion on improving government financial institutions, which addressed the need for government agencies to improve how they manage credit portfolios and monitor program risk levels over time. Panel members also discussed ways to raise red flags when there are problems in government credit programs.

The outlook was not entirely dire. “The move toward embracing risk management concepts across the federal government has been impressive in recent years,” said Doug Criscitello, a managing director at Chicago-based audit, tax, and advisory firm Grant Thornton and the former CFO of the U.S. Department of Housing and Urban Development. “We’ve seen the rise of independent risk management offices … that are housed outside the credit extension department.”

Lucas said she believes MIT’s depth in finance, economics, policy, and systems thinking make it the ideal place to study governments as the world’s largest and most complex financial institutions.

“I think an important reason that more academics haven’t taken on these issues—despite their importance—is that they are extremely complex,” she said. “Making progress takes a big investment in understanding institutions and laws and motivations. The problems are inherently interdisciplinary. And MIT is this great institution in terms of having the horsepower and energy to go after it and say ‘We can hit this question from a lot of different dimensions.’”

Professor Robert C. Merton featured speaker at Global Leader Series Economic Forum

Professor Robert C. Merton

Organized by the CUHK Business School, The Global Leader Series Economic Forum held on 16 October “proved a great success, filling the Grand Ballroom of Kowloon Shangri-La with over 600 participants and drawing an impressive array of eminent speakers and attendees. Titled ‘The Rise of the Asian Century’, the forum featured four world-renowned economists: Prof. Liu Mingkang, former Chairman of the China Banking Regulatory Commission; Prof. Robert C. Merton, 1997 Nobel Laureate in Economic Sciences and School of Management Distinguished Professor of Finance at MIT Sloan School of Management; Prof. Lawrence J. Lau, Chairman of CIC International (Hong Kong) Co., Limited; and Prof. Fred Hu, Chairman of Primavera Capital Group. Before a captivated audience, they knowledgeably presented their views on the challenges and opportunities of Asia’s economic and financial development as China continues to gain prominence.”

Click here to see the video footage from this event.