Finance Proseminars

The Finance Proseminars offer students experience in developing solutions to the challenging financial problems facing businesses today.

Dive In
Finance Proseminars


Now Reading 1 of 4

Finance Proseminars

The Finance Proseminars are one-semester Action Learning courses that offer students experience in the complex task of developing and communicating solutions to the challenging financial problems facing businesses today. Students work in teams to tackle issues posed by company sponsors and present findings to the company sponsor and their fellow classmates.

15.451 Proseminar in Capital Markets/Investment Management

This Proseminar allows students to tackle original research problems in capital market analysis and investment management that have been posed by leading experts from the financial community. 

Projects span topics such as:

  • Portfolio construction
  • Risk management
  • Hedge fund trading strategies
  • Optimal rebalancing
  • Tail risk hedging
  • Currency hedging
  • Performance measurement
  • Machine learning from the perspective of traders, portfolio managers, and institutional asset owners

15.452 Proseminar in Corporate Finance/Investment Banking

The Corporate Finance and Investment Banking Proseminar bridges the gap between finance theory and practice, and introduces students to the broader financial community. 

Finance Proseminars


Now Reading 2 of 4

15.451 Proseminar in Capital Markets/Investment Banking

T. Rowe Price

Many individuals in the US rely on their workplace Defined Contribution (DC) Plan for funding spending needs in retirement.  During their working years, individuals make planned contributions into this workplace plan.  After 20, 30 or even 40+ years of contributions, they aim to fund their planned retirement horizon largely with assets saved through this plan.  As such, portfolio assets typically reach their peak in the years around retirement. 

However, as individuals retire and begin making planned withdrawals to fund spending needs, the typical balance begins to decline several years into retirement.  Meeting the spending needs of an unknown retirement horizon, although typically 20+ years in length, without running out of income-generating assets is the objective of these funds in retirement.

Adverse market events present headwinds to this objective.  It is precisely the interaction of adverse market conditions and planned withdrawals that can wreak havoc on the ability of the portfolio to continue funding planned withdrawals for the duration of retirement.  Without withdrawals, adverse market conditions cause a "paper loss" if the portfolio subsequently rebounds.  However, withdrawals taken when the portfolio has temporarily decreased in value permanently inhibit the portfolio's future sustainability objective.  This phenomenon is commonly referred to as Sequence of Returns Risk (SORR).  The adverse market returns, particularly those that occur early in retirement when balances are largest, coupled with planned withdrawals, can adversely affect retirement success.  

Pfau (2013) illustrates that losses experienced in the first several years in distribution are the most detrimental.  He estimates that 77% of the final retirement outcome can be explained by the average return of the first 10 years of retirement.

Many DC investors use a Target Date Fund as their primary investment strategy.  These strategies are designed to de-risk into retirement in order to mitigate SORR.  The industry average glidepath is attached.  For this project, assume that the industry average glidepath is the baseline investment strategy.  Your goal is to propose ways to improve upon this strategy in order to further mitigate SORR. 

What is the mechanism by which your proposed strategy or approach further addresses SORR?  Which approaches are most effective? While we provide daily S&P 500, 5-Year Treasury constant-maturity and 30-day T-bill returns since 1960, feel free to use other return series if they are helpful.  In addition to an investment strategy, you will need to assume a withdrawal strategy for the portfolio.  The withdrawal strategy should be constant (in terms of $ amount, not % of portfolio assets) regardless of assumed investment strategy.  Use the literature to find methods to measure the degree of SORR with and without your investment strategies.  Alternatively, create your own measurement/assessment framework.


Design one or more strategies to protect a portfolio of risky assets from the potential of a major market sell-off, while enabling it to participate in further market appreciation should the current bull market persist.

These strategies could be backward looking, such as portfolio insurance strategies, or they could be based on signals of future market performance.

Test these strategies based on actual historical data or by using Monte Carlo or bootstrapping simulation.

Describe the tradeoffs associated with each of these strategies.

Action Learning

Investment Solution Earns Nobel-Level Attention

Financial Giant Seeks Rebalancing Policy

Learn More
Finance Proseminars

Info for Sponsors

Now Reading 3 of 4

Finance Proseminars

The Finance Proseminars are one-semester Action Learning courses that offer students experience in developing and communicating solutions to challenging financial problems facing businesses today. Students work in teams to tackle issues posed by company sponsors and present findings to the company sponsor and their fellow classmates. 

Interested in Becoming a Sponsor?

For more information about sponsoring a project for the Proseminar in Capital Markets/Investment Management, please contact Mark Kritzman.

To learn more about sponsoring a project for the Proseminar in Corporate Finance/Investment Banking, please contact John Parsons

Who Can Sponsor a Project?

Companies or business entities with real, challenging problems in capital markets and investment management or corporate finance and investment banking are eligible to sponsor a proseminar project. Sponsors are leaders in their field who are giving of their time and experience to engage students in this educational experience. Acting as a sponsor also helps to build a productive, long-term relationship between the company and MIT Sloan.

What is Involved in Being a Project Sponsor?

Before the proseminar class begins, corporate sponsors provide a written statement of their company’s problem and any materials they believe may be helpful in orienting the student team. After the teams have had a chance to familiarize themselves with the problem—but before the intensive work is performed—corporate sponsors conduct one telephone conference with the team or teams working on their problem to establish a clearer idea of the problem and address any questions the students may have.

During the intensive work phase, teams may have additional questions, and the class instructor will coordinate how communication in this phase is managed based on guidance from the corporate sponsor. At the end of the project, corporate sponsors will attend a class session at which the student teams will present their solutions. A written copy of the presentation will be sent to the corporate sponsor in advance.

Man writing on piece of paper

Contact Us

Keep Exploring

About Action Learning

Bringing theory to life.

Learn More

Explore our labs

MIT Sloan’s Action Learning labs take the idea of learning-by-doing to a whole new level. Come explore.

Learn More

Get involved

Bringing student teams together.

Learn More