Finance Case Studies

Ellie Campion, Dwayne Edwards, Brad Wayman, Anna Williams, William Goetzmann, and Jean Rosenthal

Nathan Cummings Foundation

Asset Management, Investor/Finance, Leadership & Teamwork, Social Enterprise, Sourcing/Managing Funds

The Nathan Cummings Foundation Investment Committee and Board of Trustees had studied the decision to go “all in” on a mission-related investment approach. The Board voted 100% to support this new direction and new goals for financial investments, but many questions remained. How could NCF operationalize and integrate this new strategy? What changes would it need to make to support the investment strategies' long-term success? How could NCF measure and track its progress and success with this new strategy?

Canary Wharf skyline of tall buildings against water

William N. Goetzmann, Jean Rosenthal, and Jaan Elias

Canary Wharf: Financing and Placemaking

Asset Management, Business History, Customer/Marketing, Entrepreneurship, Innovation & Design, Investor/Finance, Sourcing/Managing Funds, State & Society

The financial engineering of London's Canary Wharf was as impressive as the structural engineering. However, Brexit and the rise of fintech represented new challenges. Would financial firms leave the U.K.? Would fintech firms seek new kinds of space? How should the Canary Wharf Group respond?

William Goetzmann, Jean Rosenthal, Jaan Elias, Edoardo Pasinato, Lukas Cejnar, Ellie Campion

Fondaco dei Tedeschi: A New Luxury Shopping Destination for Venice

Business History, Competitor/Strategy, Customer/Marketing, Innovation & Design, Investor/Finance, Sourcing/Managing Funds, State & Society

The renovation of the Fondaco dei Tedeschi in Venice represented a grand experiment. Should an ancient building in the midst of a world heritage site be transformed into a modern mall for luxury goods? How best to achieve the transformation and make it economically sustainable? Would tourists walk to the mall? And would they buy or just look? What could each stakeholder learn from their experiences with the Fondaco dei Tedeschi?

Vero Bourg-Meyer, Javier Gimeno, Jaan Elias, Florian Ederer

Prodigy Finance

Competitor/Strategy, Investor/Finance, Social Enterprise, State & Society, Sustainability

Having pioneered a successful financing model for student loans, Prodigy also was considering other financial services that could make use of the company’s risk model. What new products could Prodigy offer to support its student borrowers? What strategy should guide the company’s new product development? Or should the company stick to the educational loans it pioneered and knew best?

Jean Rosenthal, William N. Goetzmann, Olav Sorenson, Andrew Ang, and Jaan Elias

Strategy for Norway's Pension Fund Global

Asset Management, Investor/Finance, Sourcing/Managing Funds

Norway's Pension Fund Global was the largest sovereign wealth fund in the world. With questions in 2014 on policies, ethical investment, and other concerns, what was the appropriate investment strategy for the Fund?

JAAN ELIAS, WILLIAM GOETZMANN AND LLOYD BASKIN

Role of Hedge Funds in Institutional Portfolios: Florida Retirement System

Asset Management, Financial Regulation, Investor/Finance, Metrics & Data, State & Society

The Florida Retirement System, one of the country’s largest state pensions, had been slow to embrace hedge funds, but by 2015, they had 7% of their assets in the category. How should they manage their program?

JEAN W. ROSENTHAL, EAMONN WALSH , MATT SPIEGEL, WILL GOETZMANN, DAVID BACH, DAMIEN P. MCLOUGHLIN, FERNANDO FERNÁNDEZ, GAYLE ALLARD, AND JAAN ELIAS

Bank of Ireland

Asset Management, Financial Regulation, Investor/Finance, Leadership & Teamwork, Macroeconomics, State & Society

In August 2011, Wilbur Ross, an American investor specializing in distressed and bankrupt companies, purchased 35% of the stock of Bank of Ireland. Even for Ross, investing in an Irish bank seemed risky. Observers wondered if the investment made sense.

JINGYUE XU, JEAN ROSENTHAL, K. SUDHIR, HUA SONG, XIA ZHANG, YUANFANG SONG, XIAOXI LIU, AND JAAN ELIAS

Ant Financial: Flourishing Farmer Loans at MYbank

Competitor/Strategy, Customer/Marketing, Entrepreneurship, Innovation & Design, Investor/Finance, Leadership & Teamwork, Operations, State & Society

In 2015 Ant Financial's MYbank (an offshoot of Jack Ma’s Alibaba company) created the Flourishing Farmer Loan program, an all-internet banking service for China's rural areas. Could MYbank use financial technology to create a program with competitive costs and risk management?

Jaan Elias, Sarah Friedman Hersh, Maggie Chau, Logan Ashcraft, and Pamela Jao

Commonfund ESG

Asset Management, Investor/Finance, Metrics & Data, Social Enterprise

ESG (Environmental Social and Governance) investing had become an increasingly hot topic in the financial community. Could Commonfund offer its endowment clients some investment vehicle that would satisfy ESG concerns while producing sufficient returns?

Jaan Elias, William Goetzmann, and K. Geert Rouwenhorst

Low-Carbon Investing: Commonfund & GPSU

Asset Management, Ethics & Religion, Investor/Finance, Social Enterprise, State & Society, Sustainability

In August of 2014, the movement to divest fossil fuel investments from endowment portfolios was sweeping campuses across the United States, including Gifford Pinchot State University (GPSU). How should GPSU and its investment partner Commonfund react?

Jean Rosenthal and William N. Goetzmann

Voltaire, Casanova, and 18th-Century Lotteries

Business History, State & Society

Gambling has been a part of human activity since earliest recorded history, and governments have often attempted to turn that impulse to benefit the state. The development of lotteries in the 18th century helped to develop the study of probabilities and enabled the financial success of some of the leading figures of that era.

Andrea Nagy Smith, James Chanos, and James Spellman

George Hudson and the 1840s Railway Mania

Business History, Financial Regulation, Investor/Finance, Metrics & Data

Railways were one of the original disruptive technologies: they transformed England from an island of slow, agricultural villages into a fast, urban, industrialized nation. George Hudson was the central figure in the mania for railroad shares in England. After the share value crashed, some analysts blamed Hudson, others pointed to irrational investors and still others maintained the crash was due to macroeconomic factors.

Andrea Nagy Smith, William Goetzmann, and Jeffrey Levick

Alexander Hamilton and the Origin of American Finance

Business History, Financial Regulation, Investor/Finance

Alexander Hamilton is said to have invented the future. At a time when the young United States of America was disorganized and bankrupt, Hamilton could see that the nation would become a powerful economy.

Andrea Nagy Smith and William Goetzmann

Demosthenes and Athenian Finance

Business History, Financial Regulation, Law & Contracts

Demosthenes' Oration 35, "Against Lacritus," contains the only surviving maritime loan contract from the fourth century B.C., proving that the ancient Greeks had devised a commercial code to link the economic lives of people from all over the Greek world. Athenians and non-Athenians alike came to the port of Piraeus to trade freely.

Charles Euchner, Jacob Thomas, K. Geert Rouwenhorst, and Jaan Elias

Glory, Glory Man United!

Competitor/Strategy, Employee/HR, Investor/Finance, Leadership & Teamwork, Sourcing/Managing Funds

Manchester United might be the greatest English sports dynasty of all time. But valuation poses unique challenges. How much should a team's success on the pitch count toward its net worth?

Andrea Nagy Smith and Mathew Spiegel

360 State Street: Real Options

Asset Management, Investor/Finance, Metrics & Data, Sourcing/Managing Funds

360 State Street proved successful, but what could Bruce Becker construct on the 6,000-square-foot vacant lot at the southwest corner of the project? Under what set of circumstances and at what time would it be most advantageous to proceed? Or should he build anything at all?

Jean Rosenthal, Heather Tookes, Henry S. Miller, and Jaan Elias

Kmart Bankruptcy

Asset Management, Financial Regulation, Investor/Finance

Less than 18 months after Kmart entered Chapter 11, the company emerged and its stocked soared. Why had the chain entered Chapter 11 in the first place and how had the bankruptcy process allowed the company to right itself?

Frank Newman and William Goetzman

South Sea Bubble

Business History, Financial Regulation

The story of the South Sea Company and its seemingly absurd stock price levels always enters into conversations about modern valuation bubbles. Because of its modern application, discerning what was at the root of the world's first stock market crash merits considerable attention. What about the South Sea Company and the political, economic and social context in which it operated led to its stunning collapse?

So Alex Roelof, K. Geert Rouwenhorst, and Jaan Elias

Oil, ETFs and Speculation

Asset Management, Financial Regulation, Investor/Finance

Since the markets' origins, traders sought standardized wares to increase market liquidity. In the 1960s and later, they sought assets uncorrelated to traditional bonds and equities. By late 2004, commodity based exchange-traded securities emerged.

Jean W. Rosenthal, Jaan Elias, William N. Goetzmann, Stanley Garstka, and Jacob Thomas

UAW VEBA

Asset Management, Healthcare, Investor/Finance, Sourcing/Managing Funds, State & Society

A centerpiece of the 2007 contract negotiations between the UAW and GM - and later with Chrysler and Ford - was establishing a Voluntary Employee Beneficiary Association (VEBA) to provide for retiree healthcare costs. The implications were substantial.

William N. Goetzmann and Jaan Elias

Brandeis and the Rose Museum

Arts Management, Asset Management, Investor/Finance, Social Enterprise, Sourcing/Managing Funds

The question of the role museums should play in university life became urgent for Brandeis in early 2009. Standard portfolios of investments had just taken a beating. Given that environment, should Brandeis sell art in order to save its other programs?

Jaan Elias, Andrea R. Nagy, Jessica P. Strauss, and William N. Goetzmann

Lahey Clinic: North Shore Expansion

Asset Management, Financial Regulation, Healthcare, Investor/Finance

In early 2007 the Lahey Clinic in Massachusetts believed that expansion of its North Shore facility was not only a smart strategy but also a business necessity. The two years of turmoil in the Massachusetts health care market prompted observers to question Lahey's 2007 decisions. Did the expansion strategy still make sense?

Allison Mitkowski, William Goetzmann, and Jaan Elias

Taking EOP Private

Asset Management, Financial Regulation, Investor/Finance, Leadership & Teamwork

With 594 properties nationwide, EOP was the nation’s largest office landlord. Despite EOP's dominance of the REIT market, analysts had historically undervalued EOP. However, Blackstone saw something in EOP that the analysts didn’t, and in November, Blackstone offered to buy EOP for $48.50 per share. What did Blackstone and Vornado see that the market didn’t?

K. Geert Rouwenhorst, Jean W. Rosenthal, and Jaan Elias

Carry Trade ETF

Innovation & Design, Investor/Finance, Macroeconomics, Sourcing/Managing Funds

In 2006 Deutsche Bank (DB) brought a new product to market – an exchange traded fund (ETF) based on the carry trade, a strategy of buying and selling currency futures. The offering received the William F. Sharpe Indexing Achievement Award for “Most Innovative Index Fund or ETF” at the 2006 Sharpe Awards. These awards are presented annually by IndexUniverse.com and Information Management Network for innovative advances in the indexing industry. The carry trade ETF shared the award with another DB/PowerShares offering, a Commodity Index Tracking Fund. Jim Wiandt, publisher of IndexUniverse.com, said, "These innovators are shaping the course of the index industry, creating new tools and providing new insights for the benefit of all investors." What was it that made this financial innovation successful?

Jean Rosenthal and Olav Sorenson

Centerbridge

Asset Management, Employee/HR, Investor/Finance, Leadership & Teamwork

When Jeffrey Aronson and Mark Gallogly founded Centerbridge, they hoped to grow the firm, but not to a point that it would lose its culture. Having added an office in London, could the firm add more locations and maintain its collegial character?

Jean Rosenthal, K. Geert Rouwenhorst, Isabel Studer, Jaan Elias, and Juan Carlos Rivera

Walmart de México: Investing in Renewable Energy

Sustainability

Walmart de México y Centroamérica contracted for power from EVM's wind farm, saving energy costs and improving sustainability. What should the company's next steps be to advance its goals?

Yale School of Management

International Center for Finance

Providing academic and professional support for research in financial economics.