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OFIN 3125A - Outline the Revolution of Long Term Investing

Type d'enseignement : Elective

Semester : Autumn 2018-2019

Number of hours : 12

Language of tuition : English

Pre-requisite

Background in corporate finance.

Course Description

The old model of allocating capital via the financial markets is under growing criticism. Its incentive structure for managers rewards the short term and it does not provide the long-term resources for the economy to grow and innovate. This view is shared by a new class of investors with long term horizons such as pension funds, endowments, high net worth individuals and sovereign wealth funds. They have promoted radical change in the financial industry with the development of “private investment” strategies such as private equity. They are also active in changing corporate behavior in terms of governance, environmental and social policies. After a survey of the various critiques levelled at the financial markets today we will turn to the investment strategy of these long-term investors, the changes they have sought to implement and the new challenges that arise for regulators and economic efficiency.

Teachers

AUBERGER, Marc (Managing partner of a private equity fund, CDC International Capital)

Pedagogical format

12 hours 6 lessons of 2 hours

Course validation

2 crédits 40 % case study in ten minutes based on material that will be placed in google drive. 50 % final test. 10 % participation

Required reading

  • William Lazonick: The Functions of the Stock Market and the Fallacies of Shareholder Value. Institute for New Economic Thinking. 2017
  • William Galston and Elaine Karmac: More Builders and Fewer Traders: a Growth Strategy for the American Economy. Brookings. 2015
  • Mac Kinsey global institute. Measuring the Economic Impact of Short Termism. 2017
  • Mac Kinsey global institute. The Rise and Rise of Private Markets. 2018
  • Boston Consulting Group: Sovereign Wealth's Hunt for the Next Unicorn. 2017