COLLEGE

Renowned Researcher in Financial Markets Invested as Brandt Professor

On the afternoon of Wednesday, September 29, Narasimhan Jegadeesh was invested as the Harry A. Brandt Distinguished Professor in Financial Markets and Options at the College of Commerce and Business Administration.


Keynote speaker Sheridan Titman (R) with long-time friend and colleague Jegadeesh.

The investiture, which took place in the Krannert Museum of Fine Arts on the Illinois campus, included remarks by Tony Waldrop, interim vice chancellor for research at Illinois, and Richard Herman, university provost, as well as Howard Thomas, dean of CBA, and Morgan Lynge, chair of the finance department. Colleagues and friends of Jegadeesh and the college were in attendance, as was his wife, Negeswari, and their two sons, Naresh and Rajesh.

Sheridan Titman, a long-time friend and colleague of Jegadeesh, who has collaborated with him on a number of research projects, gave the keynote address for the occasion. Titman, who is the McAllister Centennial Chair in Financial Services at the University of Texas, offered a clear and impressive perspective on Jegadeesh's contributions to

 understanding financial markets, beginning with the remark that: "There are probably about a thousand people doing research in finance in the United States. Less than a half dozen are responsible for the changes in the way we view financial markets. Jegadeesh is one of those five or six leaders." Titman explained that research by Jegadeesh has caused financial economists to question traditional views about the liquidity and efficiency of financial markets. "The traditional views of very liquid and efficient markets," Titman said, "left us with nothing to teach. Jegadeesh's research suggests that not only are financial markets both less liquid and less efficient than we traditionally thought but that there is no discernible link between traditional measures of risk and return. Jegadeesh's work has changed the way markets are perceived, the way finance is taught, and the way portfolio managers think," according to Titman, who concluded "I wish to congratulate Professor Jegadeesh. And I wish to congratulate the University of Illinois for providing a stimulating environment — for not just recognizing but for nurturing and producing outstanding individuals."

 

The Harry A. Brandt Distinguished Professorship in Financial Markets and Options was established in 1986, thanks to a major gift from Harry A. Brandt. The purpose of the professorship is "to provide leadership, scholarship, and curriculum development in the operation of financial markets, with particular emphasis on contracts traded on the Chicago Board Options Exchange." Brandt, who graduated Commerce in 1956 with a B.S. in accountancy, was a member of the Tribe of Illini and the Accountancy Club. While at Illinois, he also played on the Freshman and Varsity Tennis Squads. In 1973 he purchased one of the first seats on the Chicago Board Options Exchange (CBOE) and formed Brandt & Associates, which ultimately became the second largest clearing firm for options traders in the country. The firm had grown to service approximately two hundred traders at the time when it was acquired by First Options of Chicago in 1986. Now retired, Brandt is a member of the University of Illinois Presidents Council and lives in Florida.

The appointment of Jegadeesh as the first Brandt professor was made following a two-year search. "Professor Jegadeesh is a leader in the field of behavioral finance, which challenges the notion of efficient markets. He is particularly noted for his work in designing statistical tests that focus on behavior and its implications for securities prices," department chair Morgan Lynge has noted. "We're certainly very pleased that Harry Brandt provided the resources to make this appointment available. The chair allows us to retain a stronger faculty in finance at Illinois."

A professor of finance who has been a member of the CBA faculty since 1993, Jegadeesh is known for his teaching and research on investments, futures and options, and fixed-income markets. He holds a Ph.D. in finance from Columbia University, an MBA from the Indian Institute of Management, and a bachelor's from the Indian Institute of Technology. In the summer of 1997, he was honored as a Bailey Scholar in the Department of Finance at Commerce. He serves on the editorial board of the Journal of Securities Markets, and has served as a consultant both in the United States and internationally. He has also taught at the University of California at Los Angeles.

 

"There are probably about a thousand people doing research in finance in the United States. Less than a half dozen are responsible for the changes in the way we view financial markets. Jegadeesh is one of those five or six leaders."

Sheridan Titman