Thursday, April 3, 2014

Can Financial Engineering Cure Cancer?

This past Tuesday I spoke on Cybersecurity and Financial Services at the fabulous INFORMS Conference on Business Analytics & Operations Research in Boston.

In my presentation, which can be downloaded here,  I mentioned my colleagues with whom I had conducted the relevant research and also included some network images produced by one of my colleagues, Professor Mila Sherman of Finance, which was done with her dissertation advisor at the Sloan School at MIT, Professor Andrew Lo, and two other collaborators. I wrote about my experience speaking at the conference in a previous post.

Today, after teaching two of my classes, I returned to my office and in catching up with email messages found the announcement below from the Chair of our Finance Department, Professor Sanjay Nawalkha, about the CISDM Research Day in early May. I highlighted just one of the two talks that Professor Lo will be giving  in bold because the title captivated me.

Dear Colleagues,

On the behalf of the Department of Finance and the Center for International Securities and Derivative Markets (CISDM), I would like to invite all of you to the CISDM Research Day on May 2nd, 2014.  Andy Lo of MIT (ranked as one of the 100 most influential people by Time magazine a few years ago) will give the keynote speech at 11:30 AM. Andy will present his research on "Can Financial Engineering Cure Cancer? A New Approach to Funding Biomedical Innovation."  This research is part of a broader effort to raise billions of dollars to fund research on cancer drugs stuck in the pipeline. Andy will also give another talk on relationship between efficient markets and behavioral finance via evolutionary biology and cognitive neurosciences at 2:15pm. Andy's bio and the full schedule for the CISDM Research day is attached below. Professors Bing Liang and Hossein Kazemi will also make presentations. There will be opportunities to speak with Andy and other speakers during lunch and dinner times. The CISDM Research Day is sponsored by Moody's.

The full program is on the CISDM website, which I have reprised below for your convenience.


Please save May 2 for our CISDM Research Day.  The agenda and description of the talks are below. 

RSVP to if you are planning to attend.  We will be making name tags for attendees and plan to serve lunch for those who RSVP.  Looking forward to your replies and attendance. 

CISDM Research Day sponsored by Moody's

Isenberg School of Management - UMass Amherst

Featuring Andrew W. Lo, Charles E. and Susan T. Harris Professor at the MIT Sloan School of Management

DATE: Friday May 2, 2014

LOCATION:  Room 108, Isenberg School of Management (121 Presidents Drive, Amherst, MA)


11:30am-12:30pm - Introduction and Andrew Lo (MIT) presentation:  Can Financial Engineering Cure Cancer? A New Approach to Funding Biomedical Innovation
12:30-1:30pm - Lunch
1:30-2:15pm - Bing Liang (UMass Amherst) presentation (30 minute presentation and 15 minute discussion): Hedge Fund Ownership and Stock Market Efficiency
2:15-3:15pm - Andrew Lo (MIT) presentation: Lies My Finance Professor Told Me: Reconciling Efficient Markets and Behavioral Finance Via Evolutionary Biology and the Cognitive Neurosciences
3:15-3:45pm - Coffee Break
3:45-4:30pm - Hossein Kazemi (UMass Amherst) presentation (30 minute presentation and 15 minute discussion): Dynamics of Hedge Fund's Exposures: Implications for Performance and Herding
Andrew W. Lo Biography:

Andrew W. Lo is the Charles E. and Susan T. Harris Professor at the MIT Sloan School of Management and director of the MIT Laboratory for Financial Engineering. He received his Ph.D. in economics from Harvard University in 1984. Before joining MIT's finance faculty in 1988, he taught at the University of Pennsylvania's Wharton School as the W.P. Carey Assistant Professor of Finance from 1984 to 1987, and as the W.P. Carey Associate Professor of Finance from 1987 to 1988.

He has published numerous articles in finance and economics journals, and has authored several books including The Econometrics of Financial Markets, A Non-Random Walk Down Wall Street, Hedge Funds: An Analytic Perspective, and The Evolution of Technical Analysis. He is currently co-editor of the Annual Review of Financial Economics and an associate editor of the Financial Analysts Journal, the Journal of Portfolio Management, and the Journal of Computational Finance.

His awards include the Alfred P. Sloan Foundation Fellowship, the Paul A. Samuelson Award, the American Association for Individual Investors Award, the Graham and Dodd Award, the 2001 IAFE-SunGard Financial Engineer of the Year award, a Guggenheim Fellowship, the CFA Institute's James R. Vertin Award, the 2010 Harry M. Markowitz Award, and awards for teaching excellence from both Wharton and MIT.



Andrew W. Lo

Abstract: As disruptive as the recent financial crisis has been, the important lessons to be learned from the spectacular failure of financial technologies gone awry may actually pave the way for some of the most significant achievements of the 21st century. In this talk, Prof. Lo will provide a brief overview of the key role that financial innovation played in the crisis, and how a deeper appreciation of human nature and incentives may allow financial engineers to focus the enormous power of global financial markets on one of society's most pressing challenges: curing cancer.

Andrew Lo is fabulous and it will be great to welcome him again to the Isenberg School.