A conversation with Tobias Moskowitz, the Dean Takahashi ’80 B.A., ’83 M.P.P.M. Professor of Finance. Moskowitz is a researcher who studies financial markets and investments, a principal at AQR Capital Management, and the co-author of the 2011 book Scorecasting, which uses economic principles to explain the hidden side of sports.
What’s interesting to you as a scholar about asset management?
Asset management is such a dynamic field that there are so many difficult and unanswered questions to grapple with. It is one of the only fields where you can wake up each day and realize, based on a news event for that day, that something has changed or will affect markets. It combines statistics, theory, and tons of data, as well as the interplay between suppliers and demanders of capital and how human behavior and the forces of markets combine to determine prices. It is a fascinating subject area with important ramifications for investment for firms, individuals, and governments, as well as how capital is allocated efficiently from those who wish to supply it to those who wish to use it. It never gets boring.
Why were you interested in creating an academic program focused on asset management?
There is a gap in the training of young scholars going into the field. Most asset management firms hire smart young analysts who are well trained in statistics, data science, computer science, mathematics, or economics and have strong analytical abilities. However, none of them are trained in asset management or have much exposure to the problems and issues in the asset management industry. Consequently, most firms train their analysts for one to two years in asset management, which results in varying training with idiosyncratic emphasis on firm-specific issues. As such, firms spend an enormous amount of resources on haphazard training of varying quality, and trainees in these programs receive often very narrow training specific to the firm. The impetus for this program was to bridge that gap—offering a program that taught asset management skills and challenges more broadly and that could help young scholars launch their careers in the field. The program is designed to provide widespread knowledge and skills used in the industry that will appeal to a wide variety of firms in asset management—and confer a Yale degree to the students in the process.
What makes the Yale SOM asset management program distinctive?
What makes Yale SOM’s asset management program distinctive is its blend of academic and practical curriculum. We have the most unique curriculum that combines the theory and practice of investment management, using one of the top academic finance departments in the world combined with some of the world’s leading investment managers, including David Swensen, CIO of the Yale endowment and a pioneer of the Yale model, who co-created the curriculum and is a co-chair of the program.
Many around campus know that you also have a passion for sports and are particularly interested in sports analyses. In your book Scorecasting, you sought to answer questions like, “Do referees tend to favor the home team in the calls they make?” In what ways do you see COVID-related changes impacting your earlier research? How much of what you found changes without fans in the stands?
Well, the lack of fans is a great test of how much they impact the players and the referees. We argued in our book that referees are a big part of the home-field advantage, and all of the changes during COVID will provide great data and great variation across time, countries, and sports, to test this idea out of sample. I just need to find time to do it!
What’s your favorite spot on the Yale campus?
My office, as sad as that is. But I must say that Yale is a beautiful campus with so many interesting spots. The Beinecke Library is impressive and may be my second favorite spot.