Acclaimed financial economist and Nobel laureate Dr Myron Scholes has imparted investment wisdom accrued over a decorated 50-year career at an event held in Brisbane by Griffith University and Janus Henderson Investors (JHI).
Appearing at the ‘Knowledge. Shared’ seminar earlier this month, Dr Scholes – who is also JHI’s Chief Investment Strategist – delivered a keynote speech on methods to achieve better investment outcomes for investors.
Dr Scholes told the room of gathered industry professionals and academics that the majority of investment risk and returns comes from extreme positive and negative outcomes, also known as the ‘tails’ of the distribution of returns.
He explained, in his opinion, investors focus too much attention on the calculation of average returns and volatility of their investments.
Dr Scholes’ analysis suggests investors can achieve better outcomes by identifying market conditions that are more likely to deliver positive or negative tail events; to that end, he and his team at JHI have developed new methods to identify these types of market conditions.
“We are thrilled to have had the privilege to welcome Dr Myron Scholes as keynote speaker at our ‘Knowledge. Shared’ seminar,” GCPFS director Professor Robert Bianchi said. “For our colleagues and valued industry partners to have had a firsthand opportunity to be exposed to Dr Scholes’ formidable analysis and insights is truly a rare and special occasion.”
The ‘Knowledge. Shared’ seminar is a joint initiative between the Griffith Centre for Personal Finance and Superannuation (GCPFS) and JHI, aimed at sharing new knowledge and thinking on the efficient management of investment capital.
Janus Henderson Investors is a global investment manager with US$474 billion (about $632 billion) of funds under management.
In his capacity as JHI’s Chief Investment Strategist, Dr Scholes leads the global firm’s evolving asset allocation product development efforts, and partners with the investment team to contribute macro insights and quantitative analysis specific to hedging, risk management and disciplined portfolio construction.
In 1997, Dr Scholes was awarded the Nobel Memorial Prize in Economic Sciences for the development of the Black-Scholes option pricing model in 1973. He is also the Frank E. Buck Professor of Finance, Emeritus, at the Stanford Graduate School of Business, where he teaches courses on Managing Under Uncertainty and The Evolution of Finance.