Wisconsin School of Business

Youchang Wu

Assistant Professor - Finance

Youchang Wu is assistant professor of finance at Wisconsin School of Business, University of Wisconsin-Madison. His areas of research include institutional investors; corporate investment and financial policies; and empirical asset pricing. His research on the role of intermediaries in delegated portfolio management, and on market discipline and internal governance in the mutual fund industryhas been published in Journal of Finance and Review of Financial Studies.

Youchang Wu received his Ph.D in finance at the University of Vinenna, master and bachelor degrees in economics at Peking University, and has served on the faculties of both universities.
 

Selected Published Journal Articles


Stoughton, N., Wu, Y., & Zechner, J. (2011). Intermediated Investment Management.
Article AbstractIntermediaries such as financial advisers serve as an interface between portfolio managers and investors. A large fraction of their compensation is often provided through kickbacks from the portfolio manager. We provide an explanation for the widespread use of intermediaries and kickbacks. Depending on the degree of investor sophistication, kickbacks are used either for price discrimination or aggressive marketing. We explore the effects of these arrangements on fund size, flows, performance, and investor welfare. Kickbacks allow higher management fees to be charged, thereby lowering net returns. Competition among active portfolio managers reduces kickbacks and increases the independence of advisory services.
Journal of Finance (66), 947-980.
Dangl, T., Wu, Y., & Zechner, J. (2008). Market Discipline and Internal Governance in the Mutual Fund Industry.
Article AbstractWe develop a continuous-time model in which a portfolio manager is hired by a management company. On the basis of observed portfolio returns, all agents update their beliefs about the manager’s skills. In response, investors can move capital into or out of the mutual fund, and the management company can fire the manager. Introducing firing rationalizes several empirically documented findings, such as the positive relation between manager tenure and fund size or the increase of portfolio risk before a manager replacement and the following risk decrease. The analysis predicts that the critical performance threshold that triggers firing increases significantly over a manager’s tenure and that management replacements are accompanied by capital inflows when a young manager is replaced but may be accompanied by capital outflows when a manager with a long tenure is fired. Our model yields much lower valuation levels for management companies than simple applications of discounted cash flow (DCF) methods and is thus more consistent with empirical observations. (JEL G11, G23, G30)
Review of Financial Studies (21), 2307-2343.

Presentations


Seminar, University of Maryland ( 2013 ) Industry Competition, Winner’s Advantage, and Cash holdings

European Finance Association Meetings 2013 ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

Recent Advances in Mutual Fund Research ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

China International Conference in Finance ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

Western Finance Association Meetings 2013 ( 2013 ) Managerial Rents and Shareholder Value in Delegated Portfolio Management: The Case of Closed-End Funds

RSM Erasmus University Professional Asset Management Conference ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

Seminar, University of Northern Illinois ( 2013 ) Variance Regime, Variance Risk premium, and Stock Returns: Evidence from a Hidden Markov Model

University of Cologne Colloquium on Financial Market ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

Seminar, Vienna Graduate School of Finance ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

Seminar, University of Lugano ( 2013 ) Managerial Rents vs. Shareholder Value in Delegated Portfolio Management: The Case of Closed-end Funds

European Winter Finance Summit 2013 ( 2013 ) Corporate Investment Over the Business Cycle

Financial Management Association annual meeting 2012 ( 2012 ) Corporate Investment Over Uncertain Business Cycles

Financial Engineering and Risk Management International Symposium ( 2012 ) Corporate Investment Over Uncertain Business Cycles

Workshop, Karlsruhe University ( 2012 ) Corporate Investment Over Uncertain Business Cycles

Financial Intermediation Research Association 2012 ( 2012 ) The Dynammics of Hedge Fund Fees

Financial Intermediation Research Society meetings 2012 ( 2012 ) Corporate Investment Over Uncertain Business Cycles

Workshop, Vienna Graduate School of Finance ( 2012 ) Mutual Fund Families and Performance Evalution

Utah Winter Finance Conference 2012 ( 2012 ) Mutual Fund Families and Performance Evaluation

American Finance Association Meetings 2012 ( 2012 ) Mutual Fund Families and Performance Evaluation

Annual Meeting of Financial Economics and Accounting 2011 ( 2011 ) The Dynamics of Hedge Fund Fees

Workshop, UW Madison Department of Economics ( 2011 ) Corporate Investment Over Uncertain Business Cycles

Workshop, UW Madison Department of Finance ( 2011 ) Corporate Investment Over Uncertain Business Cycles

China International Conference in Finance 2011 ( 2011 ) Mutual Fund Families and Performance Evaluation

China International Conference in Finance 2011 ( 2011 ) Corporate Investment Over Uncertain Business Cycles

China International Conference in Finance 2011 ( 2011 ) The Dynamics of Hedge Fund Fees

Workshop, Cheung Kong Graduate School of Business ( 2011 ) Corporate Investment Over Uncertain Business Cycles

Workshop, Hong Kong University ( 2011 ) Corporate Investment Over Uncertain Business Cycles

Western Finance Association Meetings 2011 ( 2011 ) Mutual Fund Families and Performance Evaluation

Workshop, University of New South Wales ( 2011 ) The Dynamics of Hedge Fund Fees

Workshop, University of Technology Sydney ( 2011 ) Mutual Fund Families and Performance Evaluation

Financial Intermediation Research Society Meetings 2011 ( 2011 ) Mutual Fund Families and Performance Evaluation

Workshop, University of Illinois, Chicago ( 2011 ) Mutual Fund Families and Performance Evaluation

Workshop, University of Wisconsin-Madison Department of Finance ( 2010 ) Mutual Fund Families and Performance Evaluation

Workshop - UW Madison Department of Statistics ( 2010 ) Mutual fund families and performance evaluation

Workshop, University of Illinois, Urbana-Champaign ( 2010 ) Mutual Fund Families and Performance Evaluation

American Finance Association meetings 2009 ( 2009 ) Intermediated Investment Management

Financial Intermediation Research Society Conference 2008 ( 2008 ) Intermediated Investment Management

American Finance Association meetings 2008 ( 2008 ) Portfolio Performance, Discount Dynamics, and the Turnover of Closed-End Fund Managers

European Finance Association meetings 2007 ( 2007 ) Intermediated Investment Management

China International Conference in Finance 2007 ( 2007 ) Disentangling Liquidity and Size Effects in Stock Returns: Evidence from China

China International Conference in Finance 2007 ( 2007 ) Intermediated Investment Management

Western Finance Association Meetings 2007 ( 2007 ) Intermediated Investment Management

European Finance Association meetings 2006 ( 2006 ) Portfolio Performance, Discount Dynamics, and the Turnover of Closed-End Fund Managers

Financial Intermediation Research Society Conference 2006 ( 2006 ) Portfolio Performance, Discount Dynamics, and the Turnover of Closed-End Fund Managers

Western Finance Association meetings 2006 ( 2006 ) Portfolio Performance, Discount Dynamics, and the Turnover of Closed-End Fund Managers

American Finance Association meetings 2006 ( 2006 ) Market discipline and internal governance in the mutual fund industry


Undergraduate Courses


Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Spring 2009.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Spring 2009.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 3), Spring 2009.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Spring 2010.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Spring 2010.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Spring 2011.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Spring 2011.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 3), Spring 2011.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Fall 2013. Download Syllabus

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Spring 2012.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Spring 2012.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 1), Fall 2012.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Fall 2012.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 3), Fall 2012.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 2), Fall 2013.

Derivative Securities
Course DescriptionPricing and uses of options, futures, and forward contracts.
(FIN 330 Section 3), Fall 2013.



Graduate Courses


Seminar-Workshop in Finance (FIN 973), Fall 2008.

Advanced Derivative Securities
Course DescriptionThis course covers the design of new financial securities, advanced techniques for pricing and measuring the risks of derivative securities, and strategies employing derivative securities. Applications include the pricing and use of swaps, mortgage-backed
(FIN 830 Section 1), Spring 2012. Download Syllabus



Photograph of Youchang Wu

Youchang Wu

 
Assistant Professor | Finance
(608) 890-2595
5274C Grainger Hall