Investment Models

In collaboration with the Research Institute of the Finnish Economy, The Conference of Great Lakes and St. Lawrence Governors and Premiers, and the Global CleanTech Cluster Association, we developed fund design principles for industrial renewal and green growth.

Industrial renewal refers to the emergence of new or adapted industries or industry clusters, usually by integration of knowledge sectors and IT, or broadly as the result of technological advances. The challenge is how to organize and allocate investment assets from emerging industry clusters, given that they combine:

  1. Startups seeking venture capital or corporate investment
  2. Small and medium enterprises seeking debt or private equity investment
  3. Infrastructure projects seeking bond, debt and/or private equity investment
  4. Stocks and bonds

Why is investment fund design a topic of academic research endeavor?

Industrial renewal is an expensive and long term value proposition, because it requires industry value chains to realign, expand and integrate as the result of technological innovation, such as IoT and big data analytics. The research challenge is to develop the algorithms and uncover the trends, correlations, and investment opportunities in the area of asset risk aggregation and mitigation. 

Our work has focused on the development of a new type of investment vehicle: the Multi-Asset Renewal Fund.  The fund integrates know-how from:

  • The emerging industry system from the financial network map
  • The unstructured (forward-looking) risk metrics of underlying assets
  • Allocation strategies based on a rules-based repository

Recent Students and Collaborators

  • Patrick Bradley, MSc, Erb Institute and Ross School of Business;
  • Sven Adriaens, BBA, Finance, Michigan State University;
  • Students from CEE/ChE 686 course (class of 2016).
  • Antti Tahvanainen, PhD, Research Institute of the Finnish Economy, Helsinki, Finland;
  • Chris Haeuselmann, Global CleanTech Cluster Association;
  • Conference of Great lakes and St. Lawrence Governors and Premiers; Michigan Office of the Great Lakes
  • Mark Diaz, Managing Director, NatureVest at The Nature Conservancy;
  • Sylvain Reynes, President, Credit Spectrum (NY);
  • Jonas Englund (SEV Bank, NY), and many others