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Keynes the investor

In a blog and podcast published by the CFA Institute, David Chambers of the Newton Centre for Endowment Asset Management at Cambridge Judge talks about Keynes’s investment philosophy.

Keynes the investor

The role of John Maynard Keynes as an economist whose ideas helped shape global policies is very well known.

Dr David Chambers

Dr David Chambers

But less talked about is Keynes’s investment philosophy – a subject explored in a recent article by David Chambers and Elroy Dimson of Cambridge Judge – entitled “The British origins of the US endowment model” – in the Financial Analysts Journal. Chambers is Reader in Finance and Academic Director of the Newton Centre for Endowment Asset Management (CEAM) at Cambridge Judge, and Dimson is Chairman of the Newton CEAM.

Their research on Keynes the investor is the subject of a blog post and podcast published by the CFA Institute, a global association of investment professionals. In the podcast, Chambers is interviewed by Barbara Petitt, CFA, the head of journal publications at CFA Institute.

In the podcast, Chambers says the research into Keynes the investor was inspired by a key chapter about the role of the stock market in Keynes’s 1936 book, The General Theory of Employment, Interest and Money, and accounts in biographies of Keynes about his role as an investor, which among other anecdotes relate that on a typical day he would have breakfast and then phone his stockbroker to trade shares from his bed.

“These stories abounded, but it was crying out for some data to be found where we could really find out what he was doing,” Chambers says in the podcast.

Professor Elroy Dimson

Professor Elroy Dimson

In the article, Chambers and Dimson outline how Keynes, who managed the endowment of King’s College, Cambridge, from 1921 until his death in 1946, was one of the first people managing institutional funds to focus on equity investments – and how Keynes’s ideas later influenced the investment decisions of US university endowments.

Newton CEAM is hosting a Financial Market History Workshop at Cambridge Judge on 23-24 July, bringing together some of the world’s leading academics in this field. The discussion will help develop content for a book about what investment professsionals need to know about financial market history, edited by Chambers and Dimson, which will be published by the CFA Institute’s Research Foundation in autumn 2015.