Message from the Director
We welcome you to our inaugural Stephen D. Cutler Center for Investments and Finance e-newsletter. Initially, we will publish the newsletter twice per semester.
When I started as Cutler Center director at the end of 2008, one of my first objectives was to meet with a diverse group of people on campus to get an idea of how the Cutler Center was perceived. Hence, in our first e-newsletter we want to introduce you to the Cutler Center by telling you more about our mission, some key players, and hopefully pique your interest in some of our upcoming events.
In brief, the Cutler Center, dedicated in March 2000, is the hub for finance-related activities and programs at Babson College. It includes finance/investments education and research, the Babson College Fund, multiple finance and investments student organizations, and the "physical" Cutler Center/information resources in the Horn Library. For a detailed description of the Cutler Center's history, mission, goals and vision, please visit the Cutler Center's Web site.
Thought leadership is an integral part of the Cutler Center's mission. Several upcoming speakers of note include Peter Brooke, who has been called "the Johnny Appleseed of venture capital" (11/10/09, on campus); Harry Markopolos, who is credited with alerting the SEC to the Madoff fraud (11/12/09, on campus); and Jurrien Timmer, director of Investment Research for Fidelity Investments (11/19/09, at the Harvard Club, Boston). We hope you will attend one or more of these dynamic, informative events.
All the best,
F. Mark D'Annolfo
Director, Stephen D. Cutler Center for Investments and Finance
Cutler Leadership TeamOur leadership team at the Cutler Center includes Babson professors and senior practitioners in investments and finance. Along with myself, these include: Kathy Hevert, Associate Professor and Finance Division Chair; Rick Spillane, Adjunct Lecturer and Cutler Center Advisory Board Chairman; Jack Cahill, Lead Finance Librarian; and Julie Bentley, Program Coordinator. For more information on their backgrounds, visit the Cutler Center Web site. In addition, both the Finance faculty and Cutler Center Board of Advisers, a veritable "Who's who" of the investments and finance world, play a large role in the success of the Cutler Center. It should also be noted that Professors Feinstein, Harrington, and Bethel, as well as Cynthia Robinson, among others, played a large role at the onset in getting the center to where it is today.
Cutler Center NewsBabson Undergraduates Win Big in International Trading Competition
A team of Babson undergraduate students won the Rotman International Trading Competition (RITC) held Feb 19-21 at the University of Toronto. The team included seniors Howard Soyfer '09, Gilbert Li '09, Serge Suchkov '09, and junior Eric Drozdov '10. The Babson team placed ahead of teams representing 38 top colleges and universities from around the world. Their first-place cash prize is $4,000. More...
BCF Students Are Finalists in the Third Annual New England Investment Research Challenge
In spring 2009, five members of the 2008-2009 Babson College Fund team competed in the final round of the New England Investment Research Challenge, hosted by the Boston Security Analysts Society at Fidelity Investments. More...
Faculty News and ResearchJennifer Bethel, Professor of Finance, published five papers in the last year. These papers include:
Ryan Davies, Assistant Professor of Finance, published three papers in 2009:
- "Policy Issues Raised by Structured Products," with A. Ferrell, Brookings-Nomura Papers on Financial Services, Yasuki Fuchita, Robert E. Litan, eds., Brookings Institution Press, 2007 (Translated into Japanese in 2009).
- "Managing the Costs of Issuing Common Equity: The Role of Registration Choice," with L. Krigman, Quarterly Journal of Finance and Accounting, 47 (4), 2009, 57-85; Reprinted in Banking and Capital Markets: New International Perspectives, Harold Black, Lloyd P. Blenman, and Edward Kane, eds., World Scientific Press 2009.
- "The Market for Shareholder-Voting Rights Around Mergers and Acquisitions: Evidence from Institutional Daily Trading and Voting," with G. Hu and Q. Wang, Journal of Corporate Finance, 15, 2009, 129-145 (Received grant from Yale University's Millstein Center for Corporate Governance and Performance).
- "Legal and Economic Issues in Litigation Arising from the 2007-2008 Credit Crisis," with A. Ferrell and G. Hu, Forthcoming in Brookings-Nomura Papers on Financial Services, Brookings Institution Press, 2009 (Translated into Chinese: Comparative Studies, 39, December 2008, 54-96, China CITIC Press).
- Woodrow Johnson, who is at the U.S. Securities and Exchange Commission, and Bethel are examining the impact of capital support agreements on investor sentiment and money market fund flows.
Ryan is the faculty adviser for undergraduate case competition teams and the Rotman International Trading Competition. Ryan also helped organize an undergraduate team to participate in the online Texas A&M University F/X Competition. Babson placed second overall, with Eric Drozdov placing fifth individually overall.
- Davies, R.J., Kim, S.S. (2009), "Using Matched Samples to Test for Differences in Trade Execution Costs," Journal of Financial Markets, 12(2), 173-202.
- Bernhardt, D., Davies, R.J. (2009), "Smart fund managers? Stupid money?," Canadian Journal of Economics, 42(2), 719-748.
- Davies, R.J., Kat, H.M., Lu, S. (2009), "Fund of hedge funds portfolio selection: A multiple-objective approach," Journal of Derivatives and Hedge Funds 15(2), 91-115.
Ryan's faculty adviser position includes participation in many competitions. Just this year, he has prepared the student teams, and in many cases, has traveled to:
Gang Hu, Assistant Professor of Finance, has five new publications in refereed journals and two recent book chapters:
- USC Marshall International Case Competition in Los Angeles.
- B-School Beanpot Case Analysis Competition at Boston University.
- IIBD Case Competition, hosted by Hong Kong Baptist University. The team was selected as one of five finalists, out of 30 international teams.
- McCombs International Business Challenge hosted by the University of Texas at Austin.
- "The Role of Institutional Investors in Seasoned Equity Offerings," with Thomas Chemmanur and Shan He, Journal of Financial Economics, 2009, forthcoming.
- "Measures of Implicit Trading Costs and Buy-Sell Asymmetry," Journal of Financial Markets 12, 2009, 418-437.
- "Costly Arbitrage and Idiosyncratic Risk: Evidence from Short Sellers," with Ying Duan and R. David McLean, Journal of Financial Intermediation, 2009, forthcoming.
- "The Market for Shareholder Voting Rights Around Mergers and Acquisitions: Evidence from Institutional Daily Trading and Voting," with Jennifer Bethel and Qinghai Wang, Journal of Corporate Finance 15, 2009, 129-145. "
- When is Stock Picking Likely to be Successful? Evidence from Mutual Funds," with Ying Duan and R. David McLean, Financial Analysts Journal 65 (2), March/April 2009, 55-66.
- "Legal and Economic Issues in Litigation Arising from the 2007-2008 Credit Crisis," with Jennifer Bethel and Allen Ferrell, in "Prudent Lending Restored: Securitization after the Mortgage Meltdown," chapter 5, page 163-235, edited by Yasuyuki Fuchita, Richard Herring, and Robert Litan, Brookings Institution Press and Nomura Institute of Capital Markets Research, 2009.
- "An Analysis of Liquidity across Markets: Execution Costs on the NYSE Versus Electronic Markets," with Michael A. Goldstein and J. Ginger Meng, forthcoming in "Liquidity, Interest Rates and Banking," page 139-167, edited by Jeffrey Morrey and Alexander Guyton, Nova Science Publishers, 2009.
Babson College Fund NewsThe BCF management has transitioned from Steve Feinstein to Rick Spillane for the 2009-2010 academic year. Feinstein had nearly a decade of success with this program, producing investment results competitive with Babson's outside managers. This year, Diane Mulcahy has joined Executives in Residence Warren Johnson, Hugh Crowther, Jim Spencer, and Alex Liss. In addition, the BCF has gone "green" with all reports delivered electronically. Executive Portfolio Managers Ken Anadu and Katie Hersey are leading a group of 22 students organized by sector. A new quantitative sector team was added this year as well. The fund is up dramatically year to date, and has been gaining steadily on the benchmark since the students have started to populate the portfolio with ideas.
In addition, BCF students have taken part in "recruiting days" at MFS and Fidelity, with a field trip to BNY Mellon scheduled in November. The group has had a steady stream of guests including Chris Bartel, director of research at Fidelity.
Library Resources NewsNew Additions to the Cutler Center
During the summer, we had the opportunity to greatly upgrade the Center's market data resources by growing our population of Bloomberg terminals from two to nine! Thanks to the help of Professor Steven Feinstein, we now will offer Bloomberg access to students, staff, and alumni without concern for capacity. With the additional Bloombergs, we plan to offer expanded training classes and Bloomberg Certification opportunities, enable faculty to use Bloomberg in classrooms, and even to teach a fixed income class in the Cutler Center in the spring semester.
Factset Renewal and Usage
After an extended trial period, the Finance Division and Cutler Center decided to renew our Factset license and make the application an integral part of undergrad and graduate equity portfolio management curriculum and for the Babson College Fund. We think it is essential that Babson grads seeking finance and investment roles are well grounded in the use of this tool which has become so important and so widespread in its use in financial services. With the generous gift by Northfield Information Services of their risk models and portfolio optimizer to use within Factset, we can use the industry standard to screen, create, optimize, and analyze portfolio risk and return.
The Center and Horn Library have made it a priority to license database resources for assisting our alumni in their networking and career needs. Especially during the current financial downturn, we have been active in promoting the use of the Cutler Center resources, both physical and electronic, to those alumni in job search. We encourage you to find out more about alumni resources.
Cutler Center EventsNovember 10
Joint event with The Arthur M. Blank Center for Entrepreneurship
A conversation on the Madoff scandal presented by BIMA
Jurrien Timmer, director of investment research for Fidelity Management & Research Co.
Boston Speaker Series
State of the Market
Downtown Harvard Club of Bosto
Please see our Web site for weekly Babson Investment Management Association (BIMA) events, and additional events hosted by the Finance Immersion Program (FIP).
Student Organization NewsThe Finance Immersion Program (FIP) and the Babson Investment Management Association (BIMA) are back in full swing for the fall 2009 semester. Congratulations to the new officers! FIP President Nancy Hidalgo (MBA candidate), FIP Vice President David Giordano (MBA candidate), BIMA Graduate President Garrett Goggin '92, M'10, BIMA Vice Presidents of Marketing and Communication Rajeev Vijayan (MBA candidate) and Todd Harrington M'10, and Vice President of Speaker Series and Events Richard Agnew '11. Mark D'Annolfo, director of the Cutler Center, is now the faculty adviser for both FIP and BIMA.