Before he became a financial theorist, William J. Bernstein was a neurologist. He spent the first 25 years of his career working with people with neurological issues and the next 25 years working with people with financial ones.
In our Masters in Business conversation, he explains his pivot: After his first book was published, Bernstein had received so many inquiries from people who wanted him to manage their money that he launched Efficient Frontier Advisors (EFA), a registered investment advisory (RIA) firm catering to ultra-high net worth investors (EFA is closed to new investors).
Bernstein earned acclaim for his recognition of the elements that drive investments by approaching finance like a science. He discussed how his doctor peers who would never so much as treat a cold without reading up on the latest medical literature jump into investing as if it was merely a hobby. Instead, Bernstein approached the issues of risking capital in order to achieve a reward from a scientific practitioner’s perspective. His work led him to win the 2017 James R. Vertin Award from CFA Institute.
He is also known for his deeply researched financial history books. He is perhaps best known for his deeply researched book, A Splendid Exchange: How Trade Shaped the World. His current writing project is a deep research into the “Madness of Crowds” – an exploration of human financial misbehavior, and an modern update to Charles MacKay’s 1841, Extraordinary Popular Delusions and the Madness of Crowds.
He also wrote The Intelligent Asset Allocator, The Four Pillars of Investing, and The Investor’s Manifesto; as well as other financial history works, including The Birth of Plenty, and Masters of the Word.
His favorite books are here; a transcript of our conversation is available here.
You can stream/download the full conversation, including the podcast extras on iTunes, Bloomberg, Overcast, and Stitcher. Our earlier podcasts can all be found at iTunes, Stitcher, Overcast, and Bloomberg.
Next week, we speak with Luis Maizel, co-founder and senior managing director at LM Capital Group, which manages 4.2 billion dollars.
