http://financeprofessorblog.blogspot.com/Finance News, Academic articles, and other things from FinanceProfessor.com. Remember Finance is not only important, but it is also fun!!!ennoreply@blogger.com (FinanceProfessor)Mon, 09 Nov 2009 17:52:55 PSTBlogger http://www.blogger.com1810125Financeprofessorcomhttp://feedburner.google.comThis is an XML content feed. It is intended to be viewed in a newsreader or syndicated to another site.http://feedproxy.google.com/~r/Financeprofessorcom/~3/uy5H7emWEAw/dr-steve-horan-discusses-exchange.htmlguest speakersnoreply@blogger.com (FinanceProfessor)Mon, 09 Nov 2009 17:52:56 PSTtag:blogger.com,1999:blog-7332340.post-5838726440374578892Dr. Steve Horan discusses Exchange Traded Funds - SBUBusinessTV on blip.tvThis is the first of three parts.On ETFsOn calculating portfolio returns in and out cash flowsOn the value of a CFA.0http://financeprofessorblog.blogspot.com/2009/11/dr-steve-horan-discusses-exchange.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/5VbxfV3RMM0/harvard-law-school-forum-on-corporate.htmlnoreply@blogger.com (FinanceProfessor)Mon, 09 Nov 2009 17:43:44 PSTtag:blogger.com,1999:blog-7332340.post-7336745492369371645The Harvard Law School Forum on Corporate Governance and Financial Regulation » Is Delaware’s Antitakeover Statute Unconstitutional?: "...no bidder in the past nineteen years has been able to achieve 85% in a hostile tender offer against a Delaware target. "Which implies that it is possible that the super-majority provisions are in fact unconstitutional since the courts at the time (1988) said0http://financeprofessorblog.blogspot.com/2009/11/harvard-law-school-forum-on-corporate.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/rTWxJ73A3fE/bonaresponds-videos.htmlnoreply@blogger.com (FinanceProfessor)Mon, 09 Nov 2009 09:40:15 PSTtag:blogger.com,1999:blog-7332340.post-4189411478760016384Ok, so this was a mistake...I was trying to post it on the BonaResponds blog, but oh well....and who knows, maybe someone out there will like it and come volunteer with us. (I would rather you do that than donate money to us, but if you want to we do accept donations ;) )YouTube - Machias video Nov 8: "Video from our work with the Christian Youth Corps in Machias on the Eisenhardt project. The0http://financeprofessorblog.blogspot.com/2009/11/bonaresponds-videos.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/3ZpsDjKq3TA/kraft-makes-163-billion-hostile-bid-for.htmlnoreply@blogger.com (FinanceProfessor)Mon, 09 Nov 2009 07:56:02 PSTtag:blogger.com,1999:blog-7332340.post-660483849771036462A week early for class, but close enough:Kraft Makes $16.3 Billion Hostile Bid for Cadbury - DealBook Blog - NYTimes.com: "Kraft on Monday formally made a £9.8 billion ($16.3 billion) hostile bid for Cadbury, making official its effort to create an international food giant. Cadbury quickly rejected the new proposal, setting up a potentially bruising fight for control of the British0http://financeprofessorblog.blogspot.com/2009/11/kraft-makes-163-billion-hostile-bid-for.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/XIx-ZUEdSHg/steve-horan-on-etfs-measuring-returns.htmlguest speakersnoreply@blogger.com (FinanceProfessor)Fri, 06 Nov 2009 17:57:03 PSTtag:blogger.com,1999:blog-7332340.post-9016004011927756757Yesterday Steve Horan spoke to my classes. Here are the slides of his presentation. The video will be uploaded soon.SBU CFA 1 From Steve0http://financeprofessorblog.blogspot.com/2009/11/steve-horan-on-etfs-measuring-returns.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/NLDy78L7zZU/joel-beningtons-presentation-pdf-to-my.htmlBehavorial Financecharitynoreply@blogger.com (FinanceProfessor)Fri, 06 Nov 2009 13:45:28 PSTtag:blogger.com,1999:blog-7332340.post-4733703655827480683The basic idea of the talk was that as social animals, we have evolved to be trusting and helpful. It was a great presentation. Next time we will have to video it (hint hint!)0http://financeprofessorblog.blogspot.com/2009/11/joel-beningtons-presentation-pdf-to-my.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/O9Y7EQxq9ew/youtube-bob-brooks-and-jonathan-godbey.htmlnoreply@blogger.com (FinanceProfessor)Fri, 06 Nov 2009 11:39:29 PSTtag:blogger.com,1999:blog-7332340.post-6905405384491643671YouTube - Bob Brooks and Jonathan Godbey of the Christian Finance Faculty Association: "A short video interview with Bob Brooks and Jonathan Godbey two of the founders of the Christian Finance Faculty Association from their inaugural meeting at the 2009 FMA conference in Reno."Here is the link to the web site and presentation the speakers refer to in the interview. .0http://financeprofessorblog.blogspot.com/2009/11/youtube-bob-brooks-and-jonathan-godbey.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/zoKo_WkhpxM/ssrn-who-selected-adjustable-rate.htmlnoreply@blogger.com (FinanceProfessor)Fri, 06 Nov 2009 08:53:31 PSTtag:blogger.com,1999:blog-7332340.post-7386248141852690760SSRN-Who Selected Adjustable-Rate Mortgages? Evidence from the 1989-2007 Surveys of Consumer Finances by John Beshears, Daniel Bergstresser: "Who Selected Adjustable-Rate Mortgages? Evidence from the 1989-2007 Surveys of Consumer Finances"Interesting and important, but not all that surprising. From the introduction:"...a lack of financial sophistication may have made a subset of households more0http://financeprofessorblog.blogspot.com/2009/11/ssrn-who-selected-adjustable-rate.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/KGQ9a1kEEx0/ssrn-do-hedge-fund-managers-identify.htmlnoreply@blogger.com (FinanceProfessor)Fri, 06 Nov 2009 08:10:29 PSTtag:blogger.com,1999:blog-7332340.post-4014776102582938622To share or not to share that is the question. Shakespeare it is not), but when and if to share ideas is an important question.How so? Suppose you have a great idea. It is an idea that you think could make you much money. You are not sure however. On one hand it could be a bad idea. But to gauge how good of idea (or to brag about it?), you have to tell others. But if you tell others,1http://financeprofessorblog.blogspot.com/2009/11/ssrn-do-hedge-fund-managers-identify.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/Zgm5mcgnoFw/behavioral-corporate-finance.htmlnoreply@blogger.com (FinanceProfessor)Wed, 04 Nov 2009 10:57:28 PSTtag:blogger.com,1999:blog-7332340.post-3499933448453897233Behavioral Corporate Finance is the main topic in class tonight. Here are some of the links we will be discussing:Musings on Markets: Behavioral Corporate Finance 1: The Objective in Decision Making:: "When stock prices go up or down on the announcement of an action, there is some aspect of that action that is pleasing or troubling to investors. All too often, markets turn out to be right and0http://financeprofessorblog.blogspot.com/2009/11/behavioral-corporate-finance.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/1ONYCVYwmT4/q-is-market-efficiency-culprit.htmlnoreply@blogger.com (FinanceProfessor)Wed, 04 Nov 2009 10:15:57 PSTtag:blogger.com,1999:blog-7332340.post-7325586537023478502Q&A: Is Market Efficiency the Culprit? - Fama/French Forum: "Most investing is done by active managers who don't believe markets are efficient. For example, despite my taunts of the last 45 years about the poor performance of active managers, about 80% of mutual fund wealth is actively managed. Hedge funds, private equity, and other alternative asset classes, which have attracted big fund inflows0http://financeprofessorblog.blogspot.com/2009/11/q-is-market-efficiency-culprit.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/tP_e7OUqC-o/hubris-of-economics-big-picture.htmlnoreply@blogger.com (FinanceProfessor)Wed, 04 Nov 2009 07:05:35 PSTtag:blogger.com,1999:blog-7332340.post-8809328670407294707The Hubris of Economics | The Big Picture:Barry Ritholtz discussing a WSJ piece ( Crisis Compels Economists To Reach for New Paradigm.) "...an intriguing look at the problems of the the field of economics. It went, however, way too easy on both the profession and its practitioners. The article fails to ask some very basic questions about the soft science, and does not discuss the fundamental0http://financeprofessorblog.blogspot.com/2009/11/hubris-of-economics-big-picture.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/3l7quXTP3nU/buffett-takeover-reduces-successors.htmlnoreply@blogger.com (FinanceProfessor)Tue, 03 Nov 2009 16:10:39 PSTtag:blogger.com,1999:blog-7332340.post-690177511405210255Interesting take on Berhshire's takeover of Burlington Northern. I confess I did not consider this at all, but it makes sense. Buffett may be concerned that his successor would be left with a large cash holding that would have to be invested. This purchase, which fits his value investing mantra, effectively does away with the cash in one fast swoop.Buffett Takeover Reduces Successor’s Need for0http://financeprofessorblog.blogspot.com/2009/11/buffett-takeover-reduces-successors.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/DRp_jYSmiSQ/predictably-irrational-heursitics-and.htmlnoreply@blogger.com (FinanceProfessor)Tue, 03 Nov 2009 15:52:59 PSTtag:blogger.com,1999:blog-7332340.post-6357195283222451494Predictably Irrational: "...what do we do when we need to make decisions but making them “correctly” is too time consuming and difficult? We adopt simplifying rules, which academics call heuristics, and these heuristics provide us with actionable outcomes that might not be ideal but they help us to reach a decision. In the case of coffee and other, similar decisions, one of the heuristics we0http://financeprofessorblog.blogspot.com/2009/11/predictably-irrational-heursitics-and.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/ufEgVC8dMho/food-for-grooming-freakonomics-blog.htmlnoreply@blogger.com (FinanceProfessor)Tue, 03 Nov 2009 07:14:41 PSTtag:blogger.com,1999:blog-7332340.post-7848325695964012965Food for Grooming - Freakonomics Blog - NYTimes.com: "New research indicates that in addition to exchanging goods and services, monkeys adjust exchange rates as supply changes. Ronald Noe, a primate ethnologist, measured the grooming behavior of vervet monkeys in southern and eastern Africa. Among these monkeys, grooming is a hot commodity and is viewed by scientists as a form of “payment” for0http://financeprofessorblog.blogspot.com/2009/11/food-for-grooming-freakonomics-blog.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/ikXuPCmgv7w/common-objections-to-capitalism-art.htmlnoreply@blogger.com (FinanceProfessor)Tue, 03 Nov 2009 06:02:01 PSTtag:blogger.com,1999:blog-7332340.post-6895975407498065635Common Objections to Capitalism - Art Carden - Mises Institute: "This article is based on Professor Carden's lecture 'Common Objections to Capitalism,' given at the 2009 Mises University Summer Program on July 30, 2009, and available as an MP3 download.A lot of people object to what they call "capitalism," but their objections hold little or no water once they are examined critically. Let's0http://financeprofessorblog.blogspot.com/2009/11/common-objections-to-capitalism-art.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/sPxH-OOdJhg/active-management-loses-in-risk-study.htmlnoreply@blogger.com (FinanceProfessor)Mon, 02 Nov 2009 17:43:47 PSTtag:blogger.com,1999:blog-7332340.post-5832731568645686088Active Management Loses in Risk Study - WSJ.com: "The study by Morningstar Inc. found that, over the past three years, while about half of actively managed funds outperformed their respective Morningstar indexes -- which cover the nine different Morningstar investment styles -- only 37% did on a risk-, size- and style-adjusted basis. The numbers are similar for five and 10-year returns.'It's not0http://financeprofessorblog.blogspot.com/2009/11/active-management-loses-in-risk-study.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/iR2WihdJlXQ/lots-of-cash-for-clunkers-freakonomics.htmlnoreply@blogger.com (FinanceProfessor)Mon, 02 Nov 2009 10:56:08 PSTtag:blogger.com,1999:blog-7332340.post-6242171300425780869(Lots of) Cash for Clunkers - Freakonomics Blog - NYTimes.com: "Edmunds.com reports that its statistical analysis of the Cash for Clunkers program finds that the program generated only 125,000 extra new vehicle sales, meaning that the cost to the U.S. government was $24,000 for each of those new cars.The reason the cost per incremental car is so high is that, according to Edmunds.com’s modeling,0http://financeprofessorblog.blogspot.com/2009/11/lots-of-cash-for-clunkers-freakonomics.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/npSOZLdSpcc/soros-launches-effort-to-battle-free.htmlnoreply@blogger.com (FinanceProfessor)Fri, 30 Oct 2009 09:41:16 PDTtag:blogger.com,1999:blog-7332340.post-2667257360607696122Soros Launches Effort to Battle Free-Market Zeal | Newsweek Voices - Michael Hirsh | Newsweek.com: "...financier George Soros is announcing a $50 million effort to speed things along. This week Soros is gathering some of the leading practitioners of the market-skeptic school, who were marginalized during the era of 'free-market fundamentalism,' among them Nobelists Joseph Stiglitz, George Akerlof0http://financeprofessorblog.blogspot.com/2009/10/soros-launches-effort-to-battle-free.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/sro1rCS3GGw/financial-bubbles-why-do-fools-fall-in.htmlBehavorial Financenoreply@blogger.com (FinanceProfessor)Fri, 30 Oct 2009 07:43:45 PDTtag:blogger.com,1999:blog-7332340.post-2084798309263723229Financial Bubbles: Why Do Fools Fall in Love? at SmartMoney.comBefore we get to finance, consider these two common occurrences:1. Imagine it is Friday Night. You do not have to work until Monday. In fact you have no commitments. You just finished all of your tests, papers, etc. You are home alone. All of your friends are out. You imagine them having great time "out" frequenting local "0http://financeprofessorblog.blogspot.com/2009/10/financial-bubbles-why-do-fools-fall-in.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/ntxGpSr-oRM/nightly-business-report-your-mind-and_29.htmlnoreply@blogger.com (FinanceProfessor)Thu, 29 Oct 2009 08:22:13 PDTtag:blogger.com,1999:blog-7332340.post-3438438637495958350Nightly Business Report . Your Mind and Your Money | PBS: "Behavioral finance teaches us few people always make logical investment decisions. Psychological and emotional biases get in the way. NBR's year-long 'Your Mind and Your Money' series aims to help investors understand those biases and make more rational decisions.Reports and interviews will appear in the NBR program on select Mondays, and0http://financeprofessorblog.blogspot.com/2009/10/nightly-business-report-your-mind-and_29.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/_SDqkFhedk4/graph-of-why-you-should-not-hold.htmlnoreply@blogger.com (FinanceProfessor)Thu, 29 Oct 2009 08:06:18 PDTtag:blogger.com,1999:blog-7332340.post-2046872203653940666DO you remember last week when I tweeted from the FMA conference about the luncheon speaker who pointed out the fact that levered ETF's that regularly relever are good at mirroring the market on a daily basis, but in the long term are bad bets since they are short an embedded option on Gamma which makes it very likely that the levered fund will be a money loser?To show this, let's look at two0http://financeprofessorblog.blogspot.com/2009/10/graph-of-why-you-should-not-hold.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/4ryn9NM6E4k/wgbh-american-experience-crash-of-1929.htmlnoreply@blogger.com (FinanceProfessor)Thu, 29 Oct 2009 05:55:39 PDTtag:blogger.com,1999:blog-7332340.post-3258506329568548437WGBH American Experience - The Crash of 1929Good video of the crash from PBS. I can not figure out how to embed it.0http://financeprofessorblog.blogspot.com/2009/10/wgbh-american-experience-crash-of-1929.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/sTZ23wVtQXg/seeds-of-adult-dishonesty-are-sown-in.htmlnoreply@blogger.com (FinanceProfessor)Wed, 28 Oct 2009 23:19:35 PDTtag:blogger.com,1999:blog-7332340.post-5997571548341276874Seeds of adult dishonesty are sown in youth, study finds -- latimes.com: "A new study claims there is truth to the adage: People who cheated on exams in high school are considerably more likely to be dishonest later in life, according to a report to be released today by the Josephson Institute of Ethics.The study, which surveyed nearly 7,000 people in various age groups nationwide, offers a0http://financeprofessorblog.blogspot.com/2009/10/seeds-of-adult-dishonesty-are-sown-in.htmlhttp://feedproxy.google.com/~r/Financeprofessorcom/~3/DMoRz4UYEQk/experiment-in-hedging-with-etfs-wsjcom.htmlnoreply@blogger.com (FinanceProfessor)Wed, 28 Oct 2009 09:51:01 PDTtag:blogger.com,1999:blog-7332340.post-975173347886384079Remember what I mentioned last week? Holding leveraged ETF's log term is generally a losing game.An Experiment in Hedging With ETFs - WSJ.com: "ProShares warns investors that it aims to have the funds' movements correspond to the inverse of the relevant market indicator on a daily basis. Over more time, the effects of compounding can (and generally will) dilute or enhance the results. For the0http://financeprofessorblog.blogspot.com/2009/10/experiment-in-hedging-with-etfs-wsjcom.html