Andrew Lo
Andrew Lo
Andrew Wen-Chuan Lois the Charles E. and Susan T. Harris Professor of Finance at the MIT Sloan School of Management. Lo is the author of many academic articles in Finance and Financial economics...
ProfessionEconomist
answer data measure nobody particular reason short
The short answer is, I don't know. Nobody knows. The reason for that is, we don't have enough data on the particular exposures we need to measure to answer that question.
direction good longer money number obvious park past produced returns sidelines sitting smart strategies waiting
At this point, there isn't an obvious place to park money, ... A number of strategies that produced good returns in the past are no longer profitable. A lot of the smart money is sitting on the sidelines right now just waiting for the direction to change.
credit fairly five funds grown last
Credit derivatives and hedge funds have grown fairly spectacularly over the last five years.
access coming everywhere investors markets money savvy united
More and more investors may be coming into markets everywhere but that doesn't mean that the markets are really getting more and more efficient, even in the United States. It does mean that there is more access for savvy investors who watch the money flows.
allow decent good people rate sufficient
If we are able to allow people to earn a decent rate of return, with sufficient scale, we can all do well by doing good.
adaptive change depending develop engaged hypothesis investors markets population says time
The adaptive markets hypothesis says that all economic institutions, like our own species, develop and change over time, depending on the population of investors that are engaged with them.
affected either great themselves
Cancer is the great equalizer. Everyone is affected by it either themselves or through loved ones.
reject
I don't entirely reject the idea of efficient markets. It needs updating.
companies entire explain responsibility seems slick troubled
If troubled companies want to explain away 2008 as a 'black swan,' then someone should take responsibility for creating the oil slick that seems to have tarred the entire flock!
best natural
Ideas percolate. Through natural selection, the best ones survive.
people perceive understand
It's important to understand how people perceive risk, and how that translates into investment behavior.
efficiency extreme extremes fear generate market periods proper
During periods of extreme fear or greed, you don't have the proper balance between those two to generate market efficiency and you get extremes in behavior.
early hard learning matter ongoing remarkable remember simply struggled throughout
What makes this story so remarkable is that throughout my early childhood I had ongoing learning difficulties, particularly in mathematics. I struggled to learn the multiplication table, and no matter how hard I tried, I simply couldn't remember 6 times 7 or 7 times 8.
afford instead might people
Some people might say, 'Can we afford it?' I think that's asking the wrong question... We should instead be asking, 'Can we really afford not to try?'