Professor Jonathan B. Berk Honored With the Fifth Ross Prize in Financial Economics

The Stephen A. Ross Prize has been awarded to the co-authors of an important 2004 paper on mutual funds’ equilibrium behavior.

October 21, 2017

 

Image

Jonathan B. Berk | Photo by Nancy Rothstein Photography

Jonathan B. Berk, the A.P. Giannini Professor of Finance, is co-author of Mutual Fund Flows and Performance in Rational Markets, published in the Journal of Political Economy in 2004. He and his co-author, the late Professor Richard Green of Carnegie Mellon University, were celebrated at a recent conference of the Foundation for the Advancement of Research in Financial Economics, or FARFE.

The prize committee named this paper the winner of the Stephen A. Ross Prize in Financial Economics because of its important contribution to the understanding of the equilibrium behavior of mutual fund returns and mutual fund flows. The paper led to a reframing of questions asked in mutual fund studies. It demonstrated three key points regarding efficient markets for mutual funds: Actively managed funds do not outperform passive benchmarks, investors reallocate their money to the better-performing funds, and there is no persistence in mutual fund returns.

The prize, which comes with a $100,000 purse, is conferred by FARFE to support research in financial economics and facilitate productive interaction between research and practice in finance. First awarded in 2008, the prize is named in honor of the late MIT financial economist Stephen A. Ross, who passed away in March 2017.

For media inquiries, visit the Newsroom.

Explore More

June 19, 2024
Written

Habitat CEO to Stanford GSB Graduates: “Values Are the Foundation”

Jonathan Reckford, in commencement address, offers insights about weathering “storms” of life
June 13, 2024
Written

Experts Share Ideas on Balancing Innovation and Competition in the AI Industry

Policymakers, industry leaders, and scholars met at Stanford to discuss AI regulation, fairness, and creators’ rights.
June 10, 2024
Video

Stanford’s Inaugural Business, Government, and Society Forum Explores the Changing Role of Leadership

Stanford GSB hosts a wide-ranging forum on responsible leadership in a polarized world.
Credit: SF Photo Agency