Burridge news

Burridge Panel to Explore Funding Innovation

Srishti Sharma — Fri, 18 Oct 2024 17:49:26 +0000

Burridge Panel to Explore Funding Innovation Srishti Sharma Fri, 10/18/2024 - 11:49

Oct. 10, 2024

Join the Burridge Center for Finance on Thursday, Nov. 7, for Funding Innovation: Private Capital Markets. Attendees will hear about capital deployment and value creation outside of the public markets through a panel discussion with industry professionals, followed by networking.

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Green Finance Summit To Tackle Sustainability Questions

Anonymous — Thu, 01 Feb 2024 21:23:21 +0000

Green Finance Summit To Tackle Sustainability Questions Anonymous (not verified) Thu, 02/01/2024 - 14:23

The Burridge Center for Finance's annual conference is going green.

At the Green Finance Summit, happening March 14 at Folsom Field's Byron R. White Stadium Club, speakers will delve into the complexities of navigating sustainability in the ever-evolving financial world. Thought leaders from academia and the finance industry will gather to tackle questions swirling at the intersection of finance, climate and technology.

Find more event details and register to attend here.

The Burridge Center for Finance's annual conference is going green. At the Green Finance Summit, happening March 14 at Folsom Field's Byron R. White Stadium Club, speakers will delve into the complexities of navigating sustainability.

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Burridge Center Hosts Funders & Founders Event

Anonymous — Tue, 26 Sep 2023 20:45:51 +0000

Burridge Center Hosts Funders & Founders Event Anonymous (not verified) Tue, 09/26/2023 - 14:45

The Burridge Center for Finance is partnering with several other Leeds organizations to bring a panel of Funders & Founders to the Byron White Club at Folsom Field on Wednesday, Nov. 15!

Don’t miss this educational panel and chance to network with industry leaders.

The idea for this panel is to demonstrate to students the wide variety of career opportunities in the start-up space, by highlighting the roles played at a company, by equity investors, debt providers and legal counsel in the raise process. We will also dive into the primary concerns and focus of each role. Finally, the panel will spend time on talking with a Chief People Officer on hiring focuses post a raise and garner insights, valuable to students in understanding start-up culture.

The Burridge Center for Finance is partnering with several other Leeds organizations to bring a panel of Funders & Founders to the Byron White Club at Folsom Field on Wednesday, Nov. 15! Don’t miss this educational panel and chance to network with industry leaders.

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Burridge Center Welcomes New Board Members

Anonymous — Tue, 29 Aug 2023 22:17:08 +0000

Burridge Center Welcomes New Board Members Anonymous (not verified) Tue, 08/29/2023 - 16:17

Incoming members will advise on global and CFA initiatives as well as the annual Burridge Center Conference.

The Burridge Center for Finance recently added five accomplished industry professionals to its advisory board, including the first international member.

“As the Burridge Center continues to grow its network of stakeholders locally, nationally and globally, we are thrilled to welcome an impressive and diverse group of new board members this year,” said Executive Director Sheila Duffy.

“We thank all of our board members, new and seasoned, for their support of the mission, values and priorities of the CU Leeds School of Business.”

The Burridge Center offers experiences and programs that bring students, faculty, alumni and industry partners together to provide networking, access to industry, and a platform to recognize the thought leadership published by the finance division of Leeds and discuss current industry trends. The Burridge Board supports the center by strategically advising and working with the executive director, Burridge staff and Leeds School constituents.

Angela Bricmont, Conference Committee

Angela Bricmont is the CFO of Denver Water. She manages the financial resources of the Board of Water Commissioners, a more than 100-year-old water utility serving 1.5 million customers in the City of Denver and surrounding suburbs. Bricmont is responsible for accounting, financial planning and performance, treasury, rates, and customer care in addition to managing the retirement plan. Since joining Denver Water in 2010, she has overseen a credit rating upgrade to AAA, implementation of a new water rate structure, issuance of Green Bonds, and funding a lead line removal program at no direct cost to customers. Angela was appointed by the mayor to serve on the Denver Urban Renewal Authority Board, and she was appointed to serve on EPA’s Environmental Financial Advisory Board.

Lance Campbell, CFA Initiatives

Lance Campbell has over 25 years of finance and operations experience leading top professionals who support business operations, global institutional investors and corporate strategy. He is currently executive vice president and chief financial officer at Intech Investment Management LLC, an independent quantitative asset manager, and a founding partner of Intech’s parent company following a management buyout from its public-company parent in 2022. He graduated from the ��«��Ƶ Leeds School of Business with a B.S. in Business Administration with an emphasis in Accounting. He also has earned the right to use the Chartered Financial Analyst (CFA) designation and is a member of the CFA Institute and the CFA Society of Colorado.

Ben Hart, Global Initiatives and Recruiting

Ben Hart is a partner at Adams Street Partners. Based in Singapore, Hart focuses on the development of institutional client and consultant relationships and works with other members of the investor relations team to serve the needs of Adams Street Partners’ clients. Hart is a member of Adams Street’s Diversity, Equity & Inclusion Committee. Prior to joining the firm, he worked at Capital Dynamics as managing director and chief operating officer of Asia, overseeing the firm’s business development efforts in Asia and North America.

Peter Stutz, CFA Initiatives

Pete Stutz has over 25 years of institutional investment industry experience as a fixed income analyst, trader and portfolio manager. He was most recently a managing director and portfolio manager at Guggenheim Partners, where he was responsible for the management of a variety of insurance company portfolios. Prior to joining Guggenheim, Stutz was a portfolio manager at Western Asset Management where he specialized in global interest rate and derivative strategies and managed inflation-linked bond portfolios. Stutz received his BS in Computer Science from the University of Illinois Urbana-Champaign and his MBA from the University of Chicago’s Booth School of Business. Pete earned Chartered Financial Analyst designation in 1996 and is currently the president of the CFA Society of Los Angeles.

Margarita Vacanti, Conference Committee

Margarita Vacanti is the senior vice president of payments for Middle Market West Region Business Development at KeyBank. She and her team of payment advisors and client managers are responsible for delivering payment solutions to over 1,300 clients across the West Region, from Alaska to Colorado. Since joining KeyBank in March 2018, Margarita has focused on driving and building more strategic engagement of payments earlier in the client prospecting process, expanding cross-selling of automation and merchant into the existing portfolio, and expanding and upskilling payments talent within the West Region.

The Burridge Center for Finance recently added five accomplished industry professionals to its advisory board, including the first international member. Incoming members will advise on global and CFA initiatives as well as the annual Burridge Center Conference.

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Model Behavior: How a Financial Theorist’s Insights Help Explain Activity in Markets

Anonymous — Thu, 06 Apr 2023 20:25:41 +0000

Model Behavior: How a Financial Theorist’s Insights Help Explain Activity in Markets Anonymous (not verified) Thu, 04/06/2023 - 14:25

Professor shares research insights in interactive talk with students during memorial lecture series.

Brian Waters explains his research interests and approach during the most recent Steven Lindstrom Pardo Memorial Finance Lecture Series talk on April 4. The series was created by the family of Pardo, an engaging and intellectually curious student who died of cancer shortly after graduating from Leeds in 2020. Below, Waters leads two students in a game to demonstrate strategy and speaks to a crowded lecture hall.

Trial by fire? Brian Waters knows all about it.

Upon finishing his economics degree from Vanderbilt University, Waters didn’t get the graduate school offers he wanted, so sought out additional experience to round out his résumé. A tip from a professor led him to the White House, where at 22 he found himself alongside some of the brightest minds in finance and economics as they confronted the worst recession since World War II.

“I went from being a student to getting thrown right into the fire—in a way that I probably should not have,” Waters, an assistant professor of finance at the ��«��Ƶ’s Leeds School of Business, said with a laugh.

Waters’ experience in the Council of Economic Advisors—an in-house think tank to help the president understand pressing economic issues—involved performing extensive financial analysis to help guide the nation’s response to the financial crisis. It also gave him focus for his academic career, which shifted to financial theory and examines contracting and the role of private information in markets.

“I try to look for those things in the market that don’t have obvious explanations, and then I write a mathematical model that explains how market participants behave in the real world,” he said.

Playing game theory

His research involves some complex mathematics, but in a recent research talk with Leeds undergrads, Waters invited the audience to participate in a couple of games to better understand strategic interactions and decision-making, as well as how insider knowledge can unravel markets.

The lecture was the latest in the annual Steven Lindstrom Pardo Memorial Finance Lecture Series, which challenges faculty to make their research presentable and engaging to undergraduate business students. It’s named for Pardo (Bus’20), an intellectually curious student and academic standout who died of cancer shortly after graduating. His family created the research series in the hopes of honoring Pardo’s curiosity and inspiring his love of learning in future generations of students.

Watching a room full of students compete in strategy games validated how approachable Waters’ work is, though he did get laughs and a few gasps when he showed students the actual mathematical model developed to validate his work on how private information can influence things like the sale of a used car—especially the value of learning within that framework.

“When I’m selling my car, I have better information about it than the buyer does,” Waters said. “But the value of that information really comes from how long I owned the car,” which both helps the owner determine a price while acting as a signal for a buyer.

Consider home sales. If two identical homes hit the market at the same time, they should be priced roughly the same. But say one’s been lived in two decades, as opposed to two years. The owners who’ve lived there 20 years, Waters said, “have really good information about the house. If it were a bad house, they wouldn’t have stayed so many years, and so the fact that they stayed indicates the value of the house must be good.”

“The best part about being a theorist is writing something down and saying, ‘Yes, that obviously applies to my behavior.’”

Professor Brian Waters

His research demonstrated that home prices—when controlled for price appreciation—follow a U-shape that’s highest when a home sells immediately or after the owners have lived there a long time, and is lowest when it turns over quickly.

Pricing points

“If you see a house for sale after two years, you’re concerned that there’s something they learned in that time that’s driving them to sell,” like flooding or bad neighbors, Waters said. That will drive down the price, “especially if you see the home comes on the market every couple of years, in which case you can probably make a lowball offer for it.”

Being able to model those agent behaviors has allowed Waters to make some interesting finds, which have been published in respected journals such as the Journal of Finance and Management Science. He has also done notable work in what he calls optimal contracting—for instance, determining the conditions under which social investors can catalyze companies to invest in greener practices, even at a loss of profit.

Just because that work is theoretical doesn’t mean it isn’t applicable. Waters drew laughs when he shared his own experience of selling his first home in ��«��Ƶ after living there for two years.

“The best part about being a theorist is writing something down and saying, ‘Yes, that obviously applies to my behavior,’” he said.

Why Leeds Faculty and research Burridge Center

Steal Away

To better explain backward induction and unraveling, Brian Waters took a page out of Major League Baseball’s opening day. A rule change now limits pitchers to two attempts to pick off a batter attempting to steal a base; a third unsuccessful attempt by the pitcher results in a balk, which means all baserunners advance to the next base.

So runners now know pitchers are unlikely to attempt a third pickoff, meaning they’re likely to be more aggressive about steal attempts after two failed pickoffs. Knowing this, though, a pitcher is unlikely to attempt a second pickoff, because it will trigger more aggressive stealing from a runner. But: That signals to runners to be aggressive after a first pickoff attempt, since the pitcher is unlikely to throw a second pickoff.

Back and forth the strategy goes until you realize runners will be more aggressive from the start, knowing the pitcher’s attempts to pick them off are limited. Waters said you could expect a much higher probability of attempted and successful stolen bases. On opening day this year, runners succeeded 21 of 23 times they attempted to steal a base. Last year, five bases were stole on on nine attempts.

Brian Waters had students playing games to understand strategy and decision-making during the annual Pardo Memorial Finance Lecture Series.

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Silicon Valley Bank’s Collapse ‘Eerily Reminiscent’ of 2008 Crisis, Leeds Experts Say

Anonymous — Tue, 14 Mar 2023 00:12:34 +0000

Silicon Valley Bank’s Collapse ‘Eerily Reminiscent’ of 2008 Crisis, Leeds Experts Say Anonymous (not verified) Mon, 03/13/2023 - 18:12

We’ve seen this movie before, so how could history be repeating itself so soon? A pair of thought leaders shares what went wrong.

The collapse of Silicon Valley Bank, followed by the subsequent failure of Signature Bank, has Leeds experts feeling deja vu, including (below right) professors Shaun Davies and Sanjai Bhagat.

The last time Shaun Davies saw a movie about bank failures, he was living it as a research analyst on a fixed-income trading desk at Smith Breeden.

“Watching what’s happening at Silicon Valley Bank right now is bringing back all those warm fuzzy feelings of 2007 and 2008,” said Davies, an associate professor of finance and research director of the Burridge Center for Finance at the Leeds School of Business. “It’s eerily reminiscent.”

Silicon Valley Bank’s failure last week, and the subsequent failure of Signature Bank, reminded Davies of his industry career, when questions were being raised about the health of Bear Stearns and its hedge funds.

“We had a lot of political figures saying the problem was contained. We had a lot of CEOs coming on the news saying everything would be OK,” he said. “Being removed from the financial crisis for nearly 15 years, we can look back and understand how everything unfolded. But in that moment, no one knew what would happen, or how bad it might get. That’s a little how I feel now.”

Sanjai Bhagat, a professor of finance at Leeds, wasn’t working at trading desk when the subprime crisis unfolded, but he did write the book on the factors that contributed to it. “Financial Crisis, Corporate Governance and Bank Capital” was featured in Harvard Business Review, among others, and the subject of discussion in the U.S. Department of Treasury and the FDIC as experts and regulators worked to head off the next crisis.

Two of Bhagat’s key recommendations were ignored by Silicon Valley Bank—tighter controls on executive compensation and requiring lenders to finance more of their banks with equity capital.

“VCs and entrepreneurs cannot be allowed to say they want the upside of greater equity without having to face the downside of debt financing.”

Professor Sanjai Bhagat

In the 2008 crisis, he said, “CEOs sold hundreds of millions of dollars of stock just prior to the crisis. We recommended restricting compensation, so that executives cannot sell stock or exercise options for six or 12 months after they leave the office.

“But we saw exactly the same behavior here, with senior executives selling significant amounts of their holdings leading up to last Thursday’s announcement. The SVB board needs to explain why there were no restrictions on the sale of those stocks.”

He also argued that 20 percent of banks’ total assets should be financed with equity capital. At 2022 year end, 5.8 percent of SVB’s assets were financed by equity capital.

‘A parade of non sequiturs’

“Banks’ arguments against having more equity capital amounts to a parade of non sequiturs—arguments that are just economic nonsense,” he said.

A major difference from the 2008 subprime mortgage crisis is that this time around, the Federal Reserve is actively fighting inflation. Davies pointed out that Fed Chairman Jerome Powell said last year that the agency would aggressively raise interest rates to curb inflation, a process that would be painful.

Career outlooks still strong

Shaun Davies’ decision to leave industry for academia at the height of the 2008 financial crisis was a long-planned move, and not the result of subprime mortgages.
“It was completely coincidental,” he said.
However, he’s not surprised when finance students come up to him, as they have in the last day or so, to ask what this might mean for their futures. “I was just teaching and a student in the quantitative finance program pulled me aside and asked about whether she’d be able to get a job,” he said. “In six months, there will be so many opportunities for a quant who can model risk. Your job prospects are probably better today than last week.”
He also pointed out that new regulations for smaller and regional banks will create new employment opportunities for compliance and other experts.

“Yesterday’s actions”—guaranteeing deposits at the banks—“were probably the right ones, but the U.S. government undermined the Fed’s credibility in the inflation fight. Because at the first sign of real pain, they flinched.”

Furthermore, Davies said, if this becomes a long-term approach by the Fed, it will encourage excessive risk from banks, since they’ll have a federal safety net for their depositors, creating potential havoc in the markets going forward.

He’s also concerned about investor psychology, especially for those with accounts at regional banks, whose stock prices have taken a beating since SVB’s news came out.

“Panic can cause good banks to fail,” he said. “We don’t have much recent experience with bank runs in this country, but people are getting concerned. If you have deposits above the $250,000 FDIC threshold, you might say, ‘Well, the government will insure that, but it might be safer to pull my money out.’ That’s a real threat to those regional banks, especially the ones with a high concentration of their deposits with just a few people and companies.”

Venture investment

Another unknown in this particular crisis is the impact on venture investment. In a world of rising interest rates, it was always going to be that much tougher for startups to raise capital. Now, with an institutional advocate like SVB sidelined, “you may see innovation stifled as it becomes harder to get capital to entrepreneurs,” Davies said.

“Silicon Valley Bank had a very unique skillset. Maybe they can maintain that knowledge if they’re sold, but you may see that knowledge lost and dispersed among competitors,” he said. “There will be players who move into this space, but you’re not going to replicate the kind of expertise this bank had overnight.”

But, as Bhagat pointed out, the run on SVB might be part of a larger question about how high-tech, high-growth ventures should be financed.

“Financing your high-tech, high-growth company with debt is the original sin,” he said. “I understand why founders and VCs would do it—it means they don’t have to dilute their own equity ownership in the startup. But that comes with additional risks.

“VCs and entrepreneurs cannot be allowed to say they want the upside of greater equity without having to face the downside of debt financing, because now, the U.S. taxpayer is stuck holding the bill.”

[video:https://youtu.be/nFYVLnHC550]

Why Leeds Faculty and research Burridge Center

Why didn’t we learn from this movie the last time we saw it? And what do we do to prevent this from becoming a trilogy?

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Burridge Center Celebrates 25 Years of Student Impact

Anonymous — Tue, 13 Sep 2022 14:52:23 +0000

Burridge Center Celebrates 25 Years of Student Impact Anonymous (not verified) Tue, 09/13/2022 - 08:52

Years of rich connections and experiences at Burridge have altered countless student futures.

Burridge Center for Finance Program Director Matt Fleming, Associate Dean for Business & Government Relations Rich Wobbekind, Dick Burridge Jr., and Burridge Center Exectuive Director Sheila Duffy were among those who celebrated the center's 25th anniversary at a reception this fall.

For a quarter century, the Burridge Center for Finance has been connecting students to the local and global finance communities—helping students transfer classroom concepts into real-world insights. In celebration of its 25 years of impact, the Burridge Center hosted a special reception on August 29 for friends and supporters, to honor Dick Burridge, Sr., who established the center with a landmark gift in 1997 and has consistently supported Leeds over the decades.

Eight members of the Burridge family were present to celebrate all that has been accomplished since the center's inception.

“It is clear that Dick Burridge, Sr. was committed to bringing together academics, industry professionals, and students, and working hard to support Leeds,” said Sheila Duffy, executive director of the center. "We can’t thank the Burridge family enough for continuing his legacy and supporting our mission.”

Moving forward, Duffy plans to expand partnerships across more sectors, in order to offer a full spectrum of career opportunities for students. Also in the works is an effort to increase the number of Leeds students who are engaged with the center. Lastly, she intends to reset and relaunch the annual Burridge conference after its pandemic pause.

Fostering financial futures

The Burridge Center plays an important role in enhancing the student academic experience through experiential learning, academic research, community engagement and industry exposure. The center takes Leeds students beyond the classroom to promote thought leadership and intellectual innovation, preparing students to address the needs of the finance profession of tomorrow through programs, events and resources.

Students studying finance can participate in many programs and clubs supported by the Burridge Center, including Leeds Investment and Trading Group, Women in Finance, Investment Banking Club, Scholars in Finance, M&A and LBO Modeling Boot Camp, Personal Financial Planning track, Quantitative Finance Certificate program as well as case competitions and finance career treks.

Duffy has made it her mission to be a voice for young professionals. “I love the energy and creativity of people who are just starting their journey, and I enjoy finding ways to help them feel supported in understanding their skills and how they fit into finance,” she said.

She stressed the importance of building connections between Leeds and our industry partners. “We’re literally building their talent pipeline, so we want to keep our partners close as we figure out how to best meet their needs for the future,” she said.

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Lecture Series Honors Alumnus Who Was ‘A Presence—Not Just in Size, But in Terms of His Voice’

Anonymous — Thu, 31 Mar 2022 17:52:01 +0000

Lecture Series Honors Alumnus Who Was ‘A Presence—Not Just in Size, But in Terms of His Voice’ Anonymous (not verified) Thu, 03/31/2022 - 11:52

Leeds professor delivers inaugural talk in Steven Lindstrom Pardo Memorial Finance Lecture Series.

Leeds professor Shaun Davies opened his talk by explaining the daunting research and publication process, as well as the value new research offers to a classroom. He also shared stories of his friendship with Steve Pardo, his former student, pictured below right.

For Shaun Davies, Steven Pardo was better known as “Game Seven.”

“I had him in class in fall of 2019, and he was a bigger guy, a presence—not just in size, but in terms of his voice in the room,” said Davies, associate professor of finance at the ��«��Ƶ’s Leeds School of Business. “I like to banter with my students, and he was just a good, intellectually curious person.”

When Pardo skipped class one day to attend the deciding seventh game of the World Series, featuring his beloved Washington Nationals, his absence was notable; Davies gave him the nickname right afterward.

“He was good at giving me a hard time, but in a good way,” Davies said. “Like saying a model we were discussing in class wouldn’t work the same way in the real world.”

Pardo, who graduated in 2020, died of cancer last year, but his family has worked with CU ��«��Ƶ to create a lecture series designed to honor the presence and intellectual curiosity he brought to life and Leeds.

“My son was a people person,” said Pardo’s mother, Cheryl Lindstrom, a radiologist in the Washington, D.C., area. “Steven was the type of kid who you’d be having lunch with him, and next thing you knew, you’d committed to going on a hike the next day, followed by driving to Pennsylvania to get fireworks for the Fourth, and then you’d be looking at plane tickets for the weekend.

“He always wanted to involve people, and we felt a lecture would be a way of bringing people together while instilling his thirst for knowledge in future generations of students.”

The Steven Lindstrom Pardo Memorial Finance Lecture Series is designed to be an annual event showcasing faculty research—when he was sick, Lindstrom said, Pardo asked Davies to share some of his research with him. Davies, who developed a relationship with the family after Pardo’s death, delivered the first lecture in the series on March 29.

Opacity in TDFs

In his lecture, Davies discussed his recent research on target-date funds, which he’s called a “phenomenal investment innovation,” though one saddled with high fees. A TDF provides investors with an evolving asset allocation designed to meet their needs at retirement, “but the average investor has no understanding of the fees they’re paying in these funds. This opaqueness is clearly unfair.”

Exchange-traded funds, on the other hand, offer passive management but very low fees. Davies and his co-author found they could replicate TDFs by building a similar basket of ETFs based on publicly available information about TDF holdings. These so-called “replicating funds” almost perfectly tracked TDF performance, but significantly outperformed them due to lower fees: From 2008 to 2019, Davies found TDF sponsors collectively overcharged nearly $30 billion.

“This is about adding transparency to an opaque market,” Davies said.

The lecture was followed by a lengthy question-and-answer with the audience of about 100, which including a large group of students in the Delta Sigma Pi business fraternity; as a student, Pardo was president of the Leeds chapter.

“I hope these lectures help lower the barrier between faculty and students to encourage relationships,” Davies said. “Steve’s influence on my life was important; I’m so glad he reached out to me. I hope we are able to honor his intellectual curiosity by helping students appreciate the research insights their professors are making.”

Prior to the lecture, Pardo’s parents hosted a group of their son’s friends for dinner at the Roadhouse, in ��«��Ƶ. People traveled from the East Coast and beyond to attend the lecture; a large group also tuned in virtually.

“We had two memorials for Steven—one in McLean and one in ��«��Ƶ—and when we looked around the rooms, a lot of those people had graced our doorway,” Lindstrom said. “It’s not like Virginia is close to Colorado—but it seemed like every time someone was passing through, they’d want to come visit and see Steven. That’s just who he was.”

Why Leeds Burridge Center Leeds finance research

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In Search for New Executive Director, Burridge Center Finds a Leader—and Mentor

Anonymous — Wed, 12 Jan 2022 16:56:32 +0000

In Search for New Executive Director, Burridge Center Finds a Leader—and Mentor Anonymous (not verified) Wed, 01/12/2022 - 09:56

Sheila Duffy brings history from Wall Street, nonprofits to Leeds.

'The industry is breaking old models, so we need to make sure we're teaching our students to be creative,' says Sheila Duffy, the newly appointed executive director of the Burridge Center at Leeds.

In selecting Sheila Duffy as its new executive director, the Burridge Center is getting an experienced leader who prioritizes mentorship and whose vision and industry expertise will be invaluable in advancing the center’s mission.

“I love the energy and creativity of people who are just starting their journey, and I enjoy finding ways to help them feel supported in understanding their skills and how they fit into finance,” Duffy said. “That was so important to me in coming to Leeds.”

Duffy joins the Leeds School of Business from PNC, where she was a senior business development officer; she also has held leadership roles at Public Trust Advisors, Forest City Enterprises and the New Mexico Treasury, among other roles. She also is president of the national board of Women in Public Finance.

She’s made it her mission to be a voice for young professionals, including creating a webinar for the CFA Institute on how to build diverse talent pipelines. The webinar is a panel of three influential women in finance who share strategies to help students choose a career path—while showing employers how to improve their student outreach.

In other words, it was the perfect preparation for someone aiming to lead the Burridge Center.

“When I think about who we’re serving at Burridge, obviously it’s our students and our faculty,” she said. “But it’s also our alumni and business partners. We’re literally building their talent pipelines, so we want to keep them close as we figure out how to best meet their needs through our students.”

“The collaborative approach between engineering and business at CU is a cutting-edge way to address future needs.”

Sheila Duffy, executive director, Burridge Center

The other part of that equation, of course, is continuing the Burridge Center’s research reach into the hands of industry. Finance faculty at Leeds have done pathbreaking work in areas like wealth management, SPACs, and investing and social media. Duffy wants to support faculty and promote their insights to further improve Leeds’ research reputation and improve the school’s already impressive research rankings.

“We have to create a sense of energy around all the great things our faculty are doing to energize our alumni, as well as our industry partners, about the value the Burridge Center creates,” she said.

With technology changing the game in finance—cryptocurrencies, algorithmic trading and robo-advising, to name a few—Duffy is especially eager to continue building relationships with businesses.

A unique strength at CU ��«��Ƶ

“Industry leaders have the crystal ball—they know what they’re going to need in the future, as far as talent goes,” she said. CU ��«��Ƶ is in a unique position, she said, having undertaken extensive conversations with industry partners to understand what it will take to lead in the future of their fields as part of Leeds’ Career Impact initiative.

“The industry is breaking old models, so we need to make sure we’re teaching our students to be creative—and I think the collaborative approach between engineering and business at CU is just one example of a cutting-edge way to address future needs,” she said.

Another major driver of change in the industry is globalization. The pandemic ended the ambitious series of industry treks finance students have taken; Duffy is eager to reinstate them, with trips to global finance centers throughout Europe and Asia.

Leeds Dean Sharon Matusik said Duffy’s experiences and perspective made her an incredibly strong candidate for the executive director position.

“Sheila’s experience in the industry and commitment to the next generation of leaders, especially women, is unparalleled,” Matusik said. “She has all the qualities we could have asked for in a director—and more.”

Why Leeds Leeds Graduate Programs Burridge Center

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The Financial Dangers Lurking in Echo Chambers

Anonymous — Mon, 15 Nov 2021 18:31:23 +0000

The Financial Dangers Lurking in Echo Chambers Anonymous (not verified) Mon, 11/15/2021 - 11:31

Confirmation bias on social media is nothing new in politics and news. New research shows it's a challenge in investing, too.

As ongoing revelations about Facebook’s algorithm are showing, social media’s ability to shape our attitudes by steering users into echo chambers is raising questions about our national discourse and drawing increasing attention from regulators.

Echo chambers—formed when users are directed to media that confirm their existing beliefs, without providing a balanced view—are pervasive in media and politics. What’s less understood is whether these echo chambers affect our daily lives, including our personal investing decisions.

Now, new research from the Leeds School of Business at the ��«��Ƶ is shedding light on the pervasiveness of echo chambers in investor beliefs and financial decisions.

“A financial context is a surprising place to see echo chambers,” said Tony Cookson, associate professor of finance at Leeds. “In politics, you can be wrong, but you don't have to pay a price for it. In finance, if you’re wrong, you pay for it through worse returns—yet we still find echo chambers are pervasive.”

In his research, Cookson and his coauthors relied on data from StockTwits—a platform similar to Twitter, but devoted to conversations about investing. Another important difference is that, unlike Facebook or Twitter, StockTwits does not have a strong recommendation engine to suggest followers or posts based on the user’s activity.

As it turns out, people don’t need an algorithm to put themselves in an echo chamber.

“If I declare in my posts that I’m bullish on Tesla, and then subsequently start following other Tesla bulls, that looks like I’m like tilting my information sourcing toward people who agree with me, versus just tilting it toward the topic itself,” Cookson said. “And this is actually pervasive across all kinds of stocks that people discuss on these platforms.”

A troubling trading trend?

What’s more, Cookson and coauthors found users who put themselves in echo chambers were more likely to be active traders—perhaps to their own peril, given the limits of their information. StockTwits is not a trading platform, so the researchers can’t see actual trades, but based on their posting activity, “we see these really strident disagreements by people who get their information from different sources, and this leads to persistent and sustainable trade in a really publicly observable way,” he said.

StockTwits users represent a good cross-section of investors and include both amateur traders as well as professionals. If you think being a pro trader insulates you from echo chambers, “it doesn’t—it’s to a lesser degree than novices, but professionals aren't immune to wanting to confirm their existing beliefs,” Cookson said.

“In politics, you can be wrong, but you don't have to pay a price for it. In finance, if you're wrong, you pay for it through worse returns.”

Tony Cookson

His findings about investment echo chambers represent the latest research thread for Cookson, a prolific publisher who also serves as an associate editor at the Journal of Financial Economics. His work has explored a wide variety of topics from bank mergers to fracking royalties to casinos. At the heart of this new research agenda, Cookson is trying to understand the role of information in financial markets and how it drives investor behavior.

He has been working with StockTwits data since about 2015, but interest this latest work on social platforms has intensified following some of the interesting retail investing climate, including outages on Robinhood and the GameStop short squeeze—the latter also driven by social media, in this case, Reddit. Cookson’s working paper won the NASDAQ Award for best paper on asset pricing at the 2021 Western Finance Association meetings; it also won best paper awards from the Chicago Quantitative Alliance and Midwest Finance Association.

“We were always getting interest from people who work in investor behavior and social media, but then this became front page news, with Reddit,” he said. “That doesn’t happen too often in academic research, so it has been exciting to see this play out.”

This research first appeared as a working paper available on the Social Sciences Research Network. It is forthcoming in the The Review of Financial Studies. Cookson’s co-authors included Joey Engelberg and Will Mullins, both of the University of California San Diego.

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