Professor Schwarz’s research focuses on the management, disclosure, and operational risk of the investment fund industry. He has analyzed whether mandatory disclosure is necessary for operational risk information to disseminate through the marketplace. He has also studied how operational risk affects the performance and survival probabilities of hedge funds. Some of his other work has examined the impact of team-management on extreme bets in the mutual fund industry. His current research examines investors’ use of disclosure information, mutual fund tournament behavior, and hedge fund investment closure. Professor Schwarz’s research has been accepted for publication in the Journal of Finance and included in testimony before the U.S. Congress House Financial Services Committee.

PUBLICATIONS

• “Mutual Fund Tournaments: The Sorting Bias and New Evidence,” 2011, Review of Financial Studies, forthcoming. (link)
• “Trust and Delegation,” with Stephen J. Brown, William Goetzmann and Bing Liang, 2011, Journal of Financial Economics, forthcoming. (link)
• “Tax Equalization in Mutual Funds,” with Steve Gill, Journal of the American Tax Association, 2011, forthcoming. (link)
• “Estimating Operational Risk for Hedge Funds: The ω-score,” with Stephen J. Brown, William Goetzmann and Bing Liang, 2009, Financial Analyst Journal 65, 43—53. (Graham and Dodd Award for Best Paper) (link)
• “Mandatory Disclosure and Operational Risk: Evidence from Hedge Fund Registration,” with Stephen J. Brown, William Goetzmann and Bing Liang, 2008, Journal of Finance 63, 2785—2815. (link)
• “Performance Characteristics of Individual vs. Team Managed Mutual Funds,” with Richard Bliss and Mark Potter, 2008, Journal of Portfolio Management 34, 110—119. (link)
• “The Progeny of CAPM,” with Sanjay Nawalkha, 2004, Journal of Investment Management, 2, 1522—1540. (link)
• “L(2,1)-labelings of the Cartesian products of two cycles,” with Denise Troxell, 2006, Discrete Applied Mathematics, 154, 1522—1540.

WORKING PAPERS

• “Is Pay for Performance Effective? Evidence from the Hedge Fund Industry,” with Bing Liang. (link)
• “The Impact of Mandatory Hedge Fund Portfolio Disclosure,” with Stephen Brown. (link)
• “Decision Making and Risk Aversion in the Cash Cab,” with Richard Bliss and Mark Potter. (link)

WORK IN PROGRESS

• “Utility of Disclosure in Highly Regulated Environments,” with Stephen J. Brown, William Goetzmann and Bing Liang.