Events

Finance Seminar

Authors:

• Joshua Pollet
  University of Illinois at Urbana-Champaign

• Charles Trzcinka
  Indiana University

• Zoran Ivković
  Michigan State University

• Ranadeb Chaudhuri
  Indiana University

Several hundred individuals holding a Ph.D. in economics, finance, or others fields work for institutional money management companies. The gross performance of domestic equity investment products managed by individuals with a Ph.D. (Ph.D. products) is superior to the performance of non-Ph.D. products matched by objective, size, and past performance for one-year returns, alphas, Sharpe ratios, information ratios, and the manipulation-proof measure MPPM. Fees for Ph.D. products are lower than those for non-Ph.D. products. Investment flows to Ph.D. products substantially exceed the flows to the matched non-Ph.D. products. Ph.D.s' publications in leading economics and finance journals further increase the performance gap.