Does the Past Help Us Predict the Future of Financial Markets?
The increasing complexity of financial instruments, the growing globalization of markets, and the increasing scale of major financial institutions all collided in the financial crisis of 2008. Has the crisis changed the markets for good? Should we expect major shifts in the long-term returns and volatility of different asset classes? What are the long-term consequences of automated trading, globalization, and other macro-trends?
This webinar took place on February 27, 2013. It was moderated by Roger Ibbotson, professor in the practice of finance. He was joined by Karl Essig '80, a partner at the financial advisory and asset management firm AgFe, and Andrew Golden '89, president of the Princeton University Investment Company.
Karl Essig '80, Partner, AgFe
Karl Essig is a partner at AgFe, a London-based financial advisory and asset management firm that is one of Europe’s leading specialists in complex financial assets. Prior to joining AgFe, Karl worked for Morgan Stanley for more than 25 years, during which he advised on and arranged financial transactions for governments, corporations, and financial institutions from the firm’s offices in London, New York, and Tokyo. Beginning in 1987, he sequentially founded Morgan Stanley’s securitization businesses in the U.S., Europe, and Asia and from 1998 through 2001 served as co-head of the firm’s Securitized Products Group, with responsibility for the origination, execution, trading, and principal financing activity associated with this global business. In 2002, he was named one of the top 100 Euromarket personalities and one of the top 10 structured finance personalities in the previous 15 years by Euroweek magazine. Karl has a BA from Stanford University and an MBA from the Yale School of Management.
Andrew Golden '89, President, Princeton University Investment Company
Andrew K. Golden has served as president of the Princeton University Investment Company (“PRINCO”), the organization responsible for managing Princeton’s endowment, since January 1995. During that time, the assets of the endowment have grown from under $4 billion to over $17 billion, after net withdrawals of more than $7 billion to fund university operations.
The endowment is broadly diversified and invests in public and private equities, both U.S. and foreign; independent return funds; real assets; and fixed income. PRINCO’s net annualized investment return for the most recent ten fiscal years (ending June 30, 2012) was 9.9%, placing PRINCO among the highest performing endowments in the country. In 2006, Mr. Golden and PRINCO received Institutional Investor magazine’s Endowment of the Year Award for Excellence in Investment Management.
Mr. Golden joined PRINCO from Duke Management Company, where he was an investment director. Prior to that, he served as a senior associate in the Investments Office at Yale University. Mr. Golden holds a BA from Duke University and an MPPM from the Yale School of Management. He has earned the Chartered Financial Analyst designation and is a member of the New York Society of Security Analysts. Mr. Golden was a member of the board of directors of the NAB Asset Corporation, a publicly traded commercial loan workout specialist. He currently serves on numerous fund advisory boards, including those of Andreessen Horowitz, General Catalyst Partners, Greylock Partners, and Northern Light Ventures. Mr. Golden served as a founding member of the Investors’ Committee of the President’s Working Group on Financial Markets.
Mr. Golden serves as a trustee of the Princeton Area Community Foundation and Rutgers Preparatory School. He is married to Carol Litowitz Golden, resides in Princeton, and has two sons, who, despite their genetic heritage, are quite athletic.
Roger Ibbotson, Professor in the Practice of Finance, Yale School of Management
Roger Ibbotson is a professor in the practice of finance at the Yale School of Management. He is also chairman and CIO of Zebra Capital Management, LLC, a global asset and hedge fund manager that focuses on capturing liquidity premiums in equity markets. He is founder, advisor, and former chairman of Ibbotson Associates, now a Morningstar Company. He has written numerous books and articles including Stocks, Bonds, Bills, and Inflation with Rex Sinquefield (updated annually) which serves as a standard reference for information and capital market returns.
Professor Ibbotson conducts research on a broad range of financial topics, including investment returns, mutual funds, international markets, portfolio management, and valuation. He has recently published The Equity Risk Premium and Lifetime Financial Advice. He has also co-authored two books with Gary Brinson, Global Investing and Investment Markets. He is a regular contributor and editorial board member to both trade and academic journals. He is the recipient of many awards including the Graham and Dodd Scroll Award in 1979, 1982, 1984, 2001, 2004, 2007, and 2011 and the Financial Analysts Journal Best Perspectives Article 2010.
Professor Ibbotson serves on numerous boards including Dimensional Fund Advisors’ funds. He frequently speaks at universities, conferences, and other forums. He received his bachelor’s degree in mathematics from Purdue University, his MBA from Indiana University, and his PhD from the University of Chicago, where he taught for more than ten years and served as executive director of the Center for Research in Security Prices.