The authors hypothesize that impression management consideration can also significantly determine investors’ conversations. This, in turn, can cause investors to inadvertently propagate noise with wide-ranging implications for the quality of investors’ investment decisions and asset prices.
There is a “Pink” elephant in the room. The paucity of women in the key investment and decisión-making roles in finance is that “pink” elephant. While women are represented at 33%, 37%, and 63% in the law, medical, and accounting professions, respectively (Morningstar 2016), the percentage of female investment decision-makers in investment pales in comparison at less than 10%. And it gets worse if we look at sub-sectors. Take private equity, it’s 6% (Lietz, 2011), hedge funds at 3% (Soloway, 2011), or investment banking documented in this scorecard, at a global median of 0%.
Who among us wouldn't want to be the savior that predicts a market crisis and saves our clients from losses in capital -- or even better -- profits from them? A central topic of interest for academics is whether there are more precise tools to predict financial crises. Those who believe so dedicate their efforts to finding early warning indicators.
The literature shows that where we come from affects both how we perceive other people as well as how we are perceived by others. These perceptions can also affect economic behavior. In this study, the author analyzes the role of cultural biases in analysts’ stock recommendations in Europe.
The primary idea behind this research is that a more sophisticated statistical technology (in the sense of reducing predictive mean squared error) produces predictions with greater variance than a more primitive technology. These technologies range from a simple logistic regression of default outcomes based on borrowers and default variables to random forest machine learning models. Said differently, improvements in predictive technology act as mean-preserving spreads for predicted outcomes—in this case, predicted default propensities on loans, which also means that there will always be some borrowers considered less risky by the new technology, or “winners”, while other borrowers will be deemed riskier “losers”, relative to their position under the pre-existing technology.
To date, there is no large-sample empirical evidence on gender balance and career outcomes in academic finance. Though we have looked into and observed where are the women in finance and women in the C-Suite. This paper specifically looks to proved insight into the statistics of female representation in the academic arena of finance.
Empowering investors through education is a foundational tenet of our firm and a big reason why we write these posts. The article we cover here is a meta-analysis 76 randomized studies on the impacts and design of financial education, a topic we've hit on before. It' almost cliche now to hear parents and educators demand schools take the initiative to make financial education a high priority. However, it's reasonable to ask, does financial education even work?
Despite their popularity and the ease of access to university-based endowments, there is little in the academic literature about the history of endowment investing. In this article, the authors aim at filling this gap.
Do mutual funds create unnecessarily complex disclosures and fee structures to obfuscate weak net performance? Yes.
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