Finance Newsletter 2015

Alumni + Friends

Newsletter Fall 2015

The Finance Department at the Isenberg School of Management

WHAT’S INSIDE: A Message from the Chair Recent News Alumni Profiles The Finance Advisory Board What’s Next

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TABLE OF CONTENTS 5 A Message from the Chair 6 Our Faculty 10 Recent News 16 Alumni Profiles 20 About the Department Undergraduate Program Graduate Program Special Programs 21 Finance Advisory Board 23 Future Plans

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A MESSAGE FROM THE CHAIR Dean Mark Fuller’s dynamic leadership over the past 5 years has transformed Isenberg into a powerhouse of state-of-theart management education. The undergraduate finance major has grown from fewer than 250 students in 2010 to more than 600 today, making it the school’s largest major. Remarkably, this rapid growth has occurred while maintaining the highest incoming SAT scores and the highest outgoing GPAs among all majors. More than 70% of our finance students graduate with at least one internship experience, and almost 95% receive job offers within three months of graduation.

These achievements owe a great deal to new initiatives, such as a rigorous and expansive curriculum with 4 tracks and 16 finance courses, the creation of a full-fledged Honors program, and the launch of a state-of-the-art Bloomberg lab. Just as important, we’ve forged academic partnerships with professional organizations such as the Chartered Financial Analyst (CFA) and the Chartered Alternative Investment Analyst (CAIA), and industry partnerships with financial companies like Moody’s and Babson Capital.

These innovations allow finance students to excel both inside and outside the classroom. They learn about real world companies through hands-on activities like internships and co-ops, networking opportunities with alums and employers through student-run clubs, and management of real money through our Minutemen family of funds. Isenberg MBA students who specialize in finance have numerous track options from general finance to advanced investments to risk management, and Ph.D. students in finance work with some of the world’s best researchers in investments and derivatives.

Our finance faculty is internationally renowned for research in investments, including hedge funds, mutual funds, risk management, stock market anomalies, international investments, tax evasion, options, fixed income derivatives, and financial econometrics.

Whether it is the cutting-edge research on predicting hedge fund failure, or the implications of Greek tax evasion for the continuing negotiations between Greece and its Eurozone partners, or measuring the systemic risk of the US financial sector after the financial crisis of 2007-2009, or debating the usefulness of LIBOR market models for pricing interest rate derivatives, the finance faculty are at the forefront of research on the world financial markets, analyzing every type of risk including liquidity risk, interest rate risk, credit risk, operational risk, bankruptcy risk, counterparty risk, systemic risk, stochastic volatility risk, and tail risk.

Our department houses the Center for International Securities and Derivatives Markets (CISDM), a global financial research center. Members of our faculty are cofounders of the Chartered Alternative Investment Analyst (CAIA), a leading professional designation in alternative investments. And we are editorial home to the Journal of Alternative Investments, the leading journal in this field.

It is exciting to begin a new chapter of engagement with Isenberg alumni through our new Isenberg Finance Advisory Board, which will meet for the first time on October 9th. This high-profile gathering of strongly committed, deeply engaged, and very successful alums represents a broad spectrum of the financial sector, including investment banking, money management, insurance, and corporate finance. With their participation and yours, we will continue to strengthen the educational experience of our students, energize our research mission, and build stronger professional ties with a community of thousands of successful graduates.

Sanjay Nawalkha Chair, Finance

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OUR FACULTY Nikolaos Artavanis Assistant Professor of Finance Professor Artavanis does research in the fields of asset pricing and financial crises.

He is the recipient of the 2013 WRDS-Wharton Best Empirical Paper in Finance Award at the WFA meetings. His research has been featured extensively in the U.S. and international financial press, including The Financial Times, The Wall Street Journal and The Economist, among others. He has received many awards, honors and grants for his research and teaching. He holds a joint appointment with Isenberg and UMass Amherst’s Commonwealth Honors College. In that role, he works closely with Honors students in his capstone course on financial crises.

Education: Ph.D. in Finance, Virginia Tech; Master’s degrees in Finance, Economics, and Mathematics.

Ben Branch Professor of Finance Professor Branch is an expert in bankruptcy investing, bankruptcy management, and valuation of distressed assets. He has managed the estates for several large bankruptcies, including those of banks and other corporations, and has been a director on several corporate boards. He has authored several books on bankruptcy management and investing, and is widely published in professional journals, including the Journal of Finance, Journal of Business, Journal of Political Economy, Journal of Financial and Quantitative Analysis, The Antitrust Bulletin, The Harvard Business Review, The Sloan Management Review, Journal of Business and Economics, Financial Management, Global Finance Journal, and Journal of Alternative Investments.

Dr. Branch is a member of the Academic Advisory Council of the Turnaround Management Association. He is a member of the Financial Management Association and a member, past President, and past Trustee of the Eastern Finance Association. His teaching interests include investments, corporate finance, industrial organizations, and financial institutions.

Education: Ph.D. Economics, University of Michigan; MA Economics, University of Texas; B.A. in Mathematics, Emory University

Ginnie Gardiner Finance Lecturer Professor Gardiner is an associate professor from The University College of the Cayman Islands. She enjoys teaching all courses in finance but her research is primarily in real estate, where, as a lifetime member of the American Real Estate Society, she has published in The Journal of Real Estate Finance and Economics, The Journal of Real Estate Research and The Journal of Real Estate Appraisal and Economics. Ginnie has served on numerous nonprofit boards such as her condominium strata, charter schools, Cayman Islands Red Cross, Financial Executives International (academic liaison), private lake community development, et al.

Education: PhD, University of Georgia, Terry College of Business; MBA and BSBA, University of Southern Mississippi

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Nikunj Kapadia Professor of Finance Professor Kapadia has published articles in the Journal of Financial Economics, Journal of Finance, Review of Financial Studies, Journal of Derivatives, and the Journal of Alternative Investments. He has served on the editorial board of the Financial Analyst Journal, and is currently on the editorial board of Journal of Derivatives. He is the recipient of two Isenberg Researcher of the Year Awards.

He authored Western Finance Association’s Caesarea Best Paper in Risk Management award for 2005, and was a Fellow of the Federal Deposit Insurance Corporation.

Dr. Kapadia is also the recipient of Isenberg’s Teaching Award. He teaches financial modeling, international finance, and financial engineering to undergraduates, and options to Ph.D. students.

Dr. Kapadia has served as an independent Director on the board of AurionPro Solutions (listed on the Bombay Stock Exchange) and held a visiting researcher position with the Office of Financial Research of the United States Treasury. Before joining Isenberg, he was with Bear Stearns in New York.

Education: Ph. D. in Finance, New York University; MBA, Indian Institute of Management, Bangalore; undergraduate degree in engineering, Maharaja Sayajirao University, Baroda.

Hossein Kazemi Michael and Cheryl Philipp Distinguished Professor of Finance Professor Kazemi is the Director of the Center for International Securities & Derivatives Markets. He has written over 30 scholarly articles in various areas of finance and has co-authored four books on asset allocation, investment management, and alternative investments. He is a Senior Adviser to the Chartered Alternative Investment Analyst (CAIA) Association, where he helps with the development of the CAIA program’s curriculum and directs the CAIA Association’s academic partnership program. In addition, he serves as the editor of Alternative Investment Analyst Review, which is published by the CAIA Association. His research has been in the areas of valuations of equity and fixed income securities, asset allocation for traditional and alternative asset classes, and evaluation and replication of active management investment products.

Education: PhD, University of Michigan Ann Arbor; M.A., Eastern Michigan University; B.A., NIOC School of Accounting & Finance

Nelson Lacey Professor of Finance A CFA charter holder, Professor Lacey teaches in the areas of corporate finance, markets and institutions, risk management, and banking. He has extensive teaching experience in the United States and abroad in countries such as Poland, Russia, Portugal, the Czech Republic, Greece, and Sweden. Professor Lacey has authored and co-authored over 40 articles in areas such as interest rate risk management and control, corporate ethics, sports betting markets, and derivatives. He has given recent invited talks in investing for the long run, liquid alternative investments, and teaching in large lecture classes. He currently consults for the Chartered Alternative Analyst Association, where he is Director of Examinations.

Education: Ph.D. in Finance, Pennsylvania State University; MBA, Arizona State University, B.S., Pennsylvania State University 7

OUR FACULTY

Lei Lian Assistant Professor of Finance Professor Lian has research interests in empirical asset pricing, derivative pricing, financial econometrics, market microstructure, and application of high-frequency financial data. She teaches financial risk management and fixed income securities to undergraduates. At the University of Chicago’s Booth School, where she earned her Ph.D., she received the Wesley C. Pickard Ph.D. Fellowship and a Summer Paper Award, among other honors.

Education: Ph.D., University of Chicago, Booth Business School; M.S., University of Chicago Department of Statistics

Bing Liang Professor of Finance Professor Liang has research interests in capital market efficiency, mutual and hedge funds, risk management, and empirical methods in finance. He has taught on all undergraduate, graduate, and executive levels.

Professor Liang’s work has appeared in the Journal of Finance, Journal of Financial Economics, Management Science, Journal of Financial and Quantitative Analysis, and many other journals. His research has been cited in the Wall Street Journal, Financial Times, The Economist, Business Week, and other publications.

He is an invited panelist for the SEC’s Roundtable on Hedge Funds. And he has been invited by the Q-Group, Inquire Europe, Inquire UK, and BSI Gamma Foundation for presentations.

Professor Liang is an editor for Journal of Alternative Investments and is on the editorial boards of the Journal of Investment Management, European Financial Management, and Journal of Investment Consulting. His many honors include the University of Massachusetts’ Award for Outstanding Accomplishments in Research and Creative Activity, the European Financial Association’s Best Paper Award, and The Financial Analysts Journal’s Graham and Dodd Award. He was also a visiting scholar at London School of Economics and visiting professor at Yale University.

Education: Ph.D. in Finance, the University of Iowa; M.S. in Statistics, Chinese Academy of Science

Matthew P. Linn Assistant Professor of Finance Professor Linn does research on empirical asset pricing and financial econometrics. He has published in the journals Communications on Stochastic Analysis and Stochastic Processes and their Applications. He has taught classes in financial management probability, and statistical analysis of financial data.

Education: Ph.D., University of Michigan, Ross School of Business; Ph.D., University of Michigan, Statistics; BSc London School of Economics and Political Science, Mathematics and Economics

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Sanjay Nawalkha Professor and Chairman of the Finance Department and the Rupinder Sidhu Faculty Fellow in Finance Professor Nawalkha is an expert in fixed income derivatives and interest rate risk management. He has authored scholarly books in different areas of fixed income, and has published numerous articles in academic and practitioner finance journals, such as the Journal of Financial Economics, the Journal of Fixed Income, Financial Analysts Journal, and the Journal of Derivatives. He has presented his work at national and international conferences, provided consulting services to large financial institutions, and given invited lectures to foreign central banks. Professor Nawalkha is associate editor of the Journal of Investment Management. He is co-founder of the finance portal, fixedincomerisk.com, which provides software and other resources for valuing fixed income derivatives.

Under Professor Nawalkha’s leadership, the finance department has grown significantly, and currently offers sixteen finance courses and four track specializations to over 600 undergraduate finance majors. He teaches a variety of doctoral courses including interest rate modeling, option pricing, and credit risk and return modeling.

His teaching style emphasizes a holistic view of finance based on the philosophy of enlightÂŹened self-interest.

Education: Ph.D. in Finance, University of Massachusetts Amherst; MBA in Finance, University of Massachusetts Amherst; BSc in Mathematics, University of Mumbai.

Mila Getmansky Sherman Associate Professor of Finance Professor Sherman has diverse research interests that include empirical asset pricing, hedge funds, performance of investment trading strategies, financial institutions, systemic risk, and system dynamics. She teaches courses in corporate finance, financial modeling, and alternative investments to MBA students and undergraduates. She is an associate director of the Center for International Securities and Derivatives Markets (CISDM), which facilitates research in international investment and derivatives markets, and interactions between the academic and business communities. Her work has appeared in the Journal of Financial Economics, Review of Financial Studies, Financial Analysts Journal, and the Journal of Investment Management.

Professor Getmansky Sherman is an associate editor of the Journal of Alternative Investments. She is a recipient of awards and grants from the Q-Group, National Bureau of Economic Research, Inquire-Europe, and National Science Foundation. She also received Isenberg’s Outstanding Research Award. Before joining UMass Amherst, Professor Getmansky Sherman worked in the quantitative research group at Deutsche Asset Management in New York and was a postdoctoral fellow at the MIT Lab for Financial Engineering.

Education: Ph.D. degree in Management, MIT Sloan School of Management; B.S. degree in Chemical Engineering and Minor in Economics, MIT

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RECENT NEWS

Finance Professor Dissects Hedge Fund Industry “Hedge funds have been a convenient target for stereotypes,” observes Isenberg finance professor Mila Getmansky Sherman. “Our recent survey of the industry’s evolution over the past two decades* sought to dispel simplistic views by dissecting hedge funds’ considerable complexity and diversity,” she emphasizes. That is to say, she says, that hedge funds offer unique investment opportunities with more complex risk exposures than traditional investments.

Since its appearance as a National Bureau of Economic Research working paper in August, the study has received press coverage from Bloomberg News, International Business Times, and other national outlets. At Bloomberg, Getmansky Sherman, who is Associate Director of Isenberg’s Center for International Securities and Derivatives Markets, fielded questions in a seven-minute live web interview.

The authors’ wide-ranging 135-page exploration of hedge funds delves into their structure, performance, data sources, and reporting biases. It examines a wealth of hedge fund styles and devotes chapters to illiquidity and hedge fund risks and their management. And it recounts hedge funds’ role in the financial crisis of 2008.

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Much of the study’s media exposure involved its empirically based finding that hedge fund earnings have been overstated. From 1996 to 2014, principal hedge fund tracking indexes reported mean annual returns of 12.6%. However, when Getmansky Sherman and her coauthors adjusted those returns for reporting biases, returns dropped to 6.3%. Those biases, which assume several varieties stem from the practice that, unlike mutual and other funds, hedge funds report their earnings voluntarily to the data bases that account for their performance.

Some hedge fund firms, the authors continued, wait to report their returns until they achieve positive results. That gives them the luxury of ignoring previous performance that might drag the numbers south.

There’s also an “extinction bias,” where funds that underperform simply stop reporting. In 2014, the attrition rate among reporting funds reached 26% in the database studied by the authors. The authors assume that those funds either didn’t report or went extinct.

“But make no mistake, our survey is not an argument against hedge funds,” emphasizes Getmansky Sherman. “They are essential vehicles of portfolio

diversification and innovation in finance. As we noted in our paper, their freedom gives them unique breadth of coverage as an industry and unique depth of expertise among individual practitioners. And they offer us a valuable monitoring system for identifying trouble spots throughout the financial system.

“Our survey examined many investment and nonstandard risk-taking strategies involving illiquidity, nonlinearities, and operations risks,” she continues. Those and other approaches, she notes, are poorly captured by conventional metrics.

“But,” she emphasizes, “more sophisticated models are available and many firms provide investors with the risk metrics to insure reliability and consumer confidence.”

Developing and testing new metrics and improved risk management techniques will continue to be a preoccupation for Getmansky Sherman, her colleagues, and the funds themselves. Meanwhile, she and her coauthors are confident that their survey will give investors, regulators, and hedge-fund managers a firm analytical handle on a dynamic, fast-evolving industry. *Hedge Funds: A Dynamic Industry in Transition. Professor Getmansky Sherman’s coauthors are MIT Sloan professor Andrew Lo and Peter Lee of the AlphaSimplex Group in Cambridge.

Professor Lo was principal presenter at Isenberg’s annual CISDM conference in October of 2014. (The Isenberg center studies alternative investments and maintains a leading hedge fund data base.)

The report is available from SSRN: http://papers.ssrn.com/sol3/papers. cfm?abstract_id=2637007

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RECENT NEWS

Isenberg Professor’s Study Sheds Light on Tax Evasion in Greece

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A study by professor Nikolaos Artavanis of tax evasion in Greece has received widespread press coverage, as it is closely related to the ongoing conversations in negotiations over the new bailout plan between Greece and its eurozone partners. On July 15, the Greek Parliament approved new austerity measures, including the significant increase of VAT (value-added tax) rates. Based on his research, Artavanis thinks that these policies may prove counterproductive. “The fiscal impact could be zero or negative because tax evasion will increase,” he told the Associated Press. “They could get less in taxes.”

Artavanis’ misgivings are fueled by his empirical research involving Greece’s restaurant industry. The Isenberg professor looked at tax revenues following an austerity-driven 2011 VAT increase from 13% to 23% in restaurants. First-year revenues of 140 million euros from the plan fell markedly short of anticipated tax income of 1 billion euros. When the government reduced the VAT rate from 23% back to 13% in August of 2013, VAT revenues decreased by 69.8

million euros, less than half the expected decline (160 million euros).

“The rate increase was accompanied by a significant increase in tax evasion; the rate reduction by a significant decrease in sales underreporting,” observed Artavanis. (The latter, he added, also affects direct taxes—explained in his study, “The Effect of VAT Rates on Tax Evasion.”) “These significant differences between predicted and realized values,” emphasized Artavanis, “show that when you fail to consider the impact of VAT increases on tax evasion, your forecasts—based on simple multiplications of new rates on the existing tax base—are doomed to fail.”

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Finance Honors Students Excel in Campus-wide Service Project This past year, three Isenberg Finance majors explained retirement options to a standing-room-only gathering of more than 100 UMass faculty and staff members. The senior honors students—Allen Lasoff ’15, Tony Dombrowski ’15, and Ben Gross ’15—described a user-friendly web site tool that they had devised for employees contemplating a one-time opportunity to switch from one retirement plan to a second.* Employees faced the decision of swapping the Commonwealth’s flexible, portable Optional Retirement Program (ORP) for a second more established plan, the Massachusetts State Employees’ Retirement System (MSERS).

During the hour-long information session, the students took employees on a step-by-step tour of the tool. With added insights from faculty supervisors Nikos Artavanis and Nikunj Kapadia, the students answered questions about the costs and benefits of the transfer, various loopholes, and courses of action to avoid.

Demonstrating the tool on a large overhead screen, the students showed their audience how to compare the two options by bringing expected

cash flows to the time of one’s expected retirement and by comparing average rates of returns from both plans. To help employees calculate those outcomes, the tool incorporated two what-if variables: an employee’s individual life expectancy and a discount rate comprising inflation risk and a second (unlikely) risk of the MSERS plan defaulting.

The three seniors—all students in Dr. Artavanis’ senior honors course—completed their project as part of their senior honors thesis. In addition to their creative and technical work, they demonstrated adept communications skills in fielding questions and comments from a broad spectrum of employees.

“This was easily the most visible public service by our students this year,” noted finance department chair Sanjay Nawalkha. “The May 1st gathering was the third information session. In other words, the students helped hundreds of employees to make better decisions about their financial future.” *The students received software development assistance from computer science major Chris Scott.

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ALUMNI PROFILES

Chuck McQuaid ’74 President and CIO, Columbia Wanger Asset Management

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“If Isenberg were a stock, I’d invest in it in a heartbeat,” observes Chuck McQuaid ’74, an Isenberg Finance graduate and long-time senior executive with Columbia Wanger Asset Management in Chicago. “Given the small size of its endowment and operating budget, Isenberg, whose rankings have soared among the nation’s top public business schools, is punching way above its weight,” he remarks.

Chuck is walking that talk with a seven-figure gift to Isenberg that will yield an endowed professorship in finance and an ongoing scholarship for students from his hometown, Ware, and its surrounding Central Massachusetts communities.

Reflecting on the scholarship, Chuck emphasizes, “I want hard-working students to have similar opportunities that I had when I graduated from UMass with money in the bank.” Tuitions were remarkably affordable back then—roughly $200 per semester—but McQuaid worked part-time, sometimes in factory jobs in his hometown. (He commuted to UMass for all but three semesters.) I got interested in becoming a securities analyst when I took Professor Deets’ investment course,” he added. “But then a classmate told me I’d need a top MBA to get such a job.”

After graduation, at age 21, he joined the University of Chicago’s MBA program. “Most of my peers were Ivy League graduates. With my UMass education, I had as much or more business knowledge as they did, although many of them entered with considerable debt from their undergraduate programs,” he recalls.

From James Lorie and other University of Chicago professors, Chuck assimilated modern financial theory, which among other things, contends that share prices efficiently incorporate nearly all market information. “University of Chicago professor and Nobelist Eugene Fama says that maybe only 3% of portfolio managers and analysts add value,” notes McQuaid. “For years I thought the percentage was higher but I agree with him now.”

ultimately as its president and chief investment officer. He managed the Columbia Acorn Fund, with a portfolio of small- to mid-cap firms with growth characteristics “not yet appreciated by the market.” To that end, Acorn’s “deep, fundamental research,” focuses on companies with sustainable competitive advantages, entrepreneurial management, and market share growth potential.

In March 2014, Chuck stepped aside from his daily management of the fund. Since then, he continues to manage a second initiative, the Columbia Thermostat Fund—a fund-of-funds that employs a longterm, conservative growth strategy and automatic rebalancing that transcends short-term market fluctuations. At the same time, he has continued to follow specific stocks for Acorn, advises analysts and writes quarterly shareholder commentaries.

“With its current progress, Isenberg is in a virtuous circle,” remarks McQuaid, who will visit Amherst in October to attend the finance department’s annual conference of its world-class alternative investments outfit, the Center for International Securities & Derivatives Markets (CISDM). “I got a good deal from UMass,” he emphasizes. “But since then, I’ve lived and worked in Chicago and payed taxes in Illinois, not Massachusetts. So after 41 years, it was time to give back. I hope Isenberg graduates who have left Massachusetts will take that message to heart.”

It was Lorie who introduced Chuck to Columbia Wanger, where he thrived for 35 years, 17

ALUMNI PROFILES

Michael Philipp ‘82 Chairman and Management Partner, Ambata Capital

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A visit to Isenberg by MBA graduate Michael Philipp ’82 last fall demonstrated just how powerful a finance skill-set can prove in problem solving across a diverse set of challenges. Michael described the activities of his merchant bank, Ambata, where as chairman and managing partner he helps capitalize and bring best practices to projects in developing nations (principally in Africa, the Middle East, and Latin America.) Those undertakings, he emphasized, all focus on clean and sustainable energy, food, water, or waste.

“My job is mostly about relationships,” Michael remarked. “I deal with heads of development banks as well as the presidents of Iceland, Ethiopia, and Tanzania.” The Isenberg alumnus assembles waves of debt and equity financing that hedge against his projects’ risks and bring leverage to their assets. “You feel like you’re doing something good for the region. And finance is underneath all of these projects,” he observed.

Michael and his oldest son, Kyle, also discussed First Artists Bank, an initiative with British rock star Dave Stewart (co-founder of the Eurhythmics) to empower artists and other innovators with financial leverage, transparency, and best practices. And he recounted some of his family foundation’s hands-on activities on behalf of the environment in Bhutan, Namibia, and Mozambique.

His Brilliant Career Before joining Ambata in 2008, Michael excelled for decades at the highest levels of investment banking in a career that began as a research assistant with Isenberg finance professors Thomas Schneeweis and Joanne Hill. Their innovative work in futures and options trading and their industry connections propelled Mike into positions after graduation in Goldman Sachs’ Fixed Income and Futures Services departments and at Merrill Lynch, where he thrived as Global Head of Futures and Options.

Deutsche Bank’s Deutsche Morgan Grenfell. At Deutsche Bank, Mike became Chairman and CEO of Deutsche Asset Management (over $600 billion in client assets). A central player in Deutsche Bank’s expansion into global investment banking, he became one of the first two non-Germans on Deutsche Bank’s board of directors.

He then joined Credit Suisse, serving on its Board of Managing Directors, responsible for the Middle East and Africa. From 2005 to 2008 he was a member of the firm’s Group Executive Board and was Chairman and CEO of Credit Suisse Europe, Middle East, and Africa.

Honoring His Isenberg Roots A founding, long-time supporter of Isenberg’s Center for International Securities and Derivative Markets (CISDM), Michael honored Professor Schneeweis with a gift in 2001 that helped establish the Michael and Cheryl Philipp Professorship in Finance. Schneeweis held the professorship until his retirement in 2014; the current Philipp Professor is Hossein Kazemi.

A former potter, Michael joined Isenberg hoping to leverage an MBA toward a career at a museum or foundation. He met Schneeweis and everything changed. ”Tom introduced me and other MBA students to futures, options, and world financial markets,” Michael recalled. “His teaching and research were always at the forefront in those markets. And his industry contacts helped many of us to launch exciting careers.”

In 1995 Mike left Merrill Lynch for London and 19

ABOUT THE DEPARTMENT OF FINANCE Program Information BBA in Finance Finance students don’t just study money; they study how money interacts with risk and time.

Understanding this relationship is key. It allows finance BBAs to help individuals, companies and governments make wise decisions about managing capital, borrowing and investing funds, optimizing returns, and staying financially sound. It’s no small task, and at Isenberg, we prepare our students for the job by offering: • Hands-on experiences with case method teaching, real-time data access though Bloomberg terminals, internships with the best financial firms, realworld money management through the Minutemen family of funds, and student club activities that develop core competencies for tackling complex financial problems.

• A Rigorous, progressive curriculum that exposes the students to current issues and prepares them for new challenges and opportunities in the financial industry • Specializations that impart how to raise debt and equity capital, evaluate profitability and riskiness of projects, value small businesses and large corporations, and make traditional and alternative investments in global financial markets. The expansive and rigorous curriculum with an honors capstone sequence provides many choices and opportunities for students to specialize in one or more of four different tracks: Corporate Finance, Financial Analyst, Financial Risk Management, and Alternative Investments.

• Financial support for travel and networking with alums, participating in case competitions, inviting executive speakers to the classroom, and obtaining scholarships to take industry certification exams.

MBA with a Focus in Finance The Isenberg MBA with a Focus in Finance offers a mix of general business and finance elective courses. This MBA is ideal for individuals who aspire to careers in corporate finance, venture

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capital, or consulting. Additional focus areas in finance through Advanced Investments and Risk Management have considerable value for future careers in investment banking and commercial banking.

Isenberg faculty members have extensive experience in delivering state-of-the-art business education both onsite and online. As an early leader in online education, the Isenberg online MBA program—with nearly 1300 students—is ranked 7th best in the nation and 11th best in the world by The Financial Times, and 12th best in the nation by U.S. News and World Report.

PhD in Finance The Ph.D. program in finance offers students an opportunity to engage in scholarly academic research and undergraduate-level teaching.

Students make significant contributions to modern financial economics and position themselves to pursue successful careers in academia and industry. In the last 10 years, our students have published in premier journals, including the Journal of Finance, the Journal of Financial Economics, the Journal of Financial and Quantitative Analysis, and Management Science. Our program’s core competencies are: • Research-oriented faculty who work closely with our students from day one. That hands-on mentorship helps prepare students to write compelling dissertations.

• Internationally recognized research in financial investments focusing on different types of risks including liquidity risk, interest rate risk, credit risk, operational risk, bankruptcy risk, counterparty risk, systemic risk, stochastic volatility risk, and tail risk.

• Outstanding research resources, including The Center for International Securities and Derivative Markets (CISDM), a leading center at Isenberg for

research in alternative investments.

introducing

THE FINANCE ADVISORY BOARD The Isenberg Finance Advisory Board (FAB) is composed of 20 global business leaders, finance innovators and creative visionaries. Most members of the FAB are also graduates of the Isenberg School and they share a keen appreciation for the mission of the School. The FAB advises and supports the department in developing deep and mutually beneficial relationships with global corporations, government partners, foundations and other organizations. The FAB collaborates with the dean, chair, faculty, staff, and students to fulfill the School’s mission by driving and facilitating corpo¬rate engagement, providing counsel and feedback, and advocating for the finance department and the Isenberg School. The board plays a key role in helping to shape the School’s future and to advance its academic and research excellence by: • Identifying and cultivating potential corporate and organizational relationships.

• Supporting career opportunities for students.

• Envisioning new educational initiatives.

• Shaping new research agendas.

• Promoting philanthropy toward the department and Isenberg School.

Board Members Gary Cameron Managing Director, JP Morgan Chase Michael Carne CFA, Senior Investment Management Executive, Portfolio Manager, NWQ Investment Management David Caruso Founding Chairman, Coastal Capital Group Harjeet Chopra Managing Director and Country Risk Officer, Citi Singapore Kristin (Slusser) Fafard Chief Investment Officer, Federal Street Advisors Peter Hadelman Principal, Copper Rock Capital Partners David Harris Senior Fixed Income Portfolio Manager, Schroders Jerry Hong President, Qfour Inc. (prior experience at ZAIS Group, and Merrill Lynch) Kerry Hueston Analyst, Surveyor Capital, Citadel, LLC Elizabeth Husted, Retired Managing Director (2006), Goldman Sachs Jim Hyatt Senior VP of Personal Lines, Arbella Insurance Group (prior experience at Hanover Insurance Group)

Gordon Johnson Managing Director, Global Equities at LMCG Investments.

Chuck McQuaid Former Chief Investment Officer, Columbia Wanger Asset Management Nandan Mer Group Executive, Global Consumer Credit, Mastercard Worldwide Dave Nagle Managing Director and Head of Investment Grade Portfolio Management, Babson Capital Clifford Noreen President, Babson Capital Michael Philipp Chairman, Reykjavik Geothermal (also at AMBATA and First Artist Bank) Charles Robinson Vice Chairman, Rogers & Gray Insurance Agency, Inc. Rupinder Sidhu Retired Co-Founder and Managing Director, Arena Capital Partners (prior experience at Merion Capital Managament, LLC, and Merrill Lynch) Kristen Walters Managing Director, Risk and Quantitative Analysis, BlackRock 21

SPECIAL PROGRAMS CISDM The Center for International Securities and Derivatives Markets (CISDM) was established two decades ago through the generous support of Michael Philipp and Anshu Jain, both graduates of the University of Massachusetts. Since then, other UMass graduates and other corporate and individual contributors have enabled CISDM to build on these contributions. With their collective support, CISDM provides opportunities for graduate and undergraduate students to involve themselves directly in the growing areas of investment and management. For the past 20 years, CISDM has been in the forefront of applied research, education, and practical applications involving derivatives, alternative investments, and asset and risk management.

Those domains have been the fastest-growing areas of finance during this period and CISDM has contributed to this growth.

Ten years ago, Garry Crowder and Lyra Capital, LLC donated the MAR hedge fund database to CISDM. Since then, CISDM has offered, on a paid subscription basis, the Morningstar/CISDM Hedge Fund Database to financial practitioners and academics. Each month, they highlight the performance of the managers that report to this database by releasing CISDM Hedge Fund and CTA Indices. The historical performances of these indices are available to the public free of charge.

In 2002, CISDM co-founded the Chartered Alternative Investment Analyst Association (CAIA) —the leading professional accreditor of alternative investment professionals. CISDM supports standards and continuing education for practitioners in this increasingly impactful profession.

CAIA is now a global organization with close to 8000 members in 85 countries and CISDM is the editorial home of The Journal of Alternative Investments, CAIA’s official publication.

CAIA The CAIA Association, a nonprofit organization founded in 2002 through the joint efforts of CISDM and the Alternative Investment

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Management Association, is the world leader and authority in alternative investment education. The CAIA Association sponsors the CAIA Charter, an internationally recognized credential granted upon successful completion of a rigorous two-level exam series, combined with relevant work experience. The CAIA Association has recently introduced the Fundamentals of Alternative Investments, a new certificate program designed for investment professionals who wish to gain a basic introduction to alternative investments. Having grown rapidly, the CAIA Association now supports vibrant chapters in financial centers around the world and sponsors more than 120 educational and networking events each year. For the past 5 years, the CAIA Association has established a number of academic partnerships with learning business of the world. Qualified students and faculty receive scholarships to take the CAIA Charter exams.

Isenberg is an academic partner of the CAIA Association.

JAI The Journal of Alternative Investments (JAI) provides its readers with cutting-edge research and expert analysis on managing investments in hedge funds, private equity, distressed debt, commodities and futures, energy, funds of funds, and other nontraditional assets. JAI is the official publication of the Chartered Alternative Investment Analyst Association. JAI provides readers with challenging ideas and practical tools to profit from the growth of hedge funds and alternatives, determine the optimal mix of traditional and alternative investments, measure and track portfolio performance, and manage alternative investment portfolios. JAI is read by hedge fund managers, portfolio managers, academics, and senior investment officials at corporations and financial institutions. Its editorial board members are Professors Kazemi (Managing Editor), Getmansky Sherman (Editor), Liang (Editor) and Noel Amenc (Edhec).

FUTURE PLANS

ANNUAL EVENTS

FUTURE PLANS

CISDM Research Day

In addition to the curricular innovations that have already taken place in our finance department, we are currently assessing new strategic possibilities in the risk and insurance domain, as well as personal finance.

October 9, 2015 Isenberg School of Management The goal of this annual conference is to bring major thinkers and innovators to the school to engage with faculty, alumni, and other industry professionals. This year’s theme is Post Financial Crisis Developments in Finance Markets and will include guest speakers Nassim Taleb, best-sell­ ing author of several books on risk and decisionmaking, including The Black Swan; Justin Fox, Bloomberg journalist, author, and former Editor of Harvard Business Review Group; and Alexandros Benos, Group Chief Risk Officer (CRO), National Bank of Greece.

Inaugural Finance Advisory Board Meeting The first annual FAB meeting will take place during CISDM Research Day. Time to be determined.

We are actively seeking funding partners for a new Center for Global Financial Education, and affiliated Trading Room, that will provide handson experience in investments, risk management, and analytic tools, while also providing stateof-the-art video-conferencing technology to enhance connectivity with corporate partners and executives.

Two new student-run funds, the Minutemen Fixed Income Fund and the Minutemen Alternative Investment Fund, will allow students to manage real money through managed accounts.

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Finance Department 121 Presidents Drive Amherst, MA 01003 A145759

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