Connecting financial theory and human behaviour; retirement risk management and planning

Luncheon presentations
11 February – Auckland
12 February – Wellington

Don’t miss this opportunity to hear from finance expert Jacques Lussier, CFA, visiting New Zealand with the support of the CFA Institute Research Foundation.

Different investors have different levels of anxiety when facing the same financial risks. These anxieties can lead to counterproductive behaviours, such as selling assets after a loss or deviating from the strategy.  Jacques Lussier, CFA, will explain how financial science and technology can be used to combat poor decision making and improve retirement outcomes.

 Attendees will learn:

  • how to structure a Retirement Risk Management Approach
  • how to understand and mitigate different retirement risks using financial theory    
  • how technology and framing can correct for investors’ cognitive biases
  • which tools can help improve retirement planning

Full synopsis

Investors fear uncertainty, some more than others. For many, it may be the fear of significant short-term losses, while for some it may also be the fear of not achieving a specific life goal, like a minimum retirement income. Investors have different levels of anxiety towards facing identical financial risks. While part of our anxieties come from our own behavioral traits (inherited or environmental), some may also be caused by a lack of understanding of investment issues and from a lack of advisory support and timely feedback.
Investment anxieties can lead to behavior which is not in the best interest of investors, such as selling assets after a loss and being unable to maintain a consistent strategy. Financial science, with the support of technology, can help manage investment anxieties in two ways. First financial science can be used to improve the risk adjusted performance of a financial plan, using appropriate and efficient asset allocation, risk reducing instruments and strategies (such as annuities and reverse mortgage) and risk management processes to manage potentially unfavorable tail events. Hence, for a given level of risk tolerance, financial science must be used to deliver the most favorable distribution of potential outcomes.

However, these efforts may not reduce the financial anxieties of the average investor if he does not understand the benefits of these efforts, cannot visualize their short- and long-term impacts and does not receive comforting feedback when circumstances suddenly and significantly change. Although the purpose of “Secure Retirement” is to support and clarify how financial science can improve the retirement effort, financial science and technology must also be used to support an intuitive understanding of investment processes and provide timely feedback to reassure investors. Financial education is a significant challenge that only grows with aging and the quality of the communication effort must compensate for the lack of financial knowledge and gradually declining cognitive abilities. Quality communication could even lead to increased risk tolerance. “Secure Retirement” provides the material and guidelines to improve the communication effort.

Register now

Auckland, Tuesday 11 February, 12-1.30pm register online
Wellington, Wednesday 12 February, 12-1.30pm register online

  • Bookings are essential
  • A light lunch is provided at the start of the event
  • CE credit = one hour
  • Forsyth Barr is kindly providing the venues for these events
  • For any questions, please contact Kylee;

Members (CFA Society NZ & INFINZ); $35 incl GST
CFA candiates $30 incl GST
Non-members; $55 incl GST

About the speaker; Jacques Lussier, CFA

Jacques has spent ten years in academia as a tenured professor at HEC Montreal and nearly twenty-five years in the financial industry, first as respectively CIO and Chief Investment Strategist at Desjardins Asset Management and then as CIO/CEO of IPSOL Capital.

During his career, Jacques has been involved in most segments of the asset management industry: portfolio policy and global asset allocation, funds of funds management both alternative and traditional, research leading to product design and product management in the equity, commodity and asset allocation space and management of a high net-worth platform. His current interests center on factor-based processes, long-term financial planning and the development of algorithms and tools to facilitate the transition towards and through retirement and how to integrate recent advancements in investment processes into financial planning engines.

Jacques earned a B.A. in Economics and a M.Sc. in Finance from HEC Montreal and a Ph.D. in International Business from the University of South Carolina. He is a CFA and was president of the Montreal CFA Society from 2013 to 2015. ​He is the author of several publications such as “Successful Investing Is a process (Bloomberg Press), Rational Investing (Columbia University Press) and Secure Retirement (CFA Institute Research Foundation).

Jacques received the C. Stewart Sheppard Award in 2018 attributed annually since 1976 to a CFA charterholder for his contribution in fostering education of professional investors through advancement of the body of knowledge, development of programs, publications or other learning tools to encourage continuing education in our profession.

He is a board member of Retraite Québec and president of its investment committee. Retraite Québec administers the Québec Pension Plan (~70B), public-sector pension plans (~80B), supplemental pension plans and the family allowance program. It also ensures the conformity of voluntary retirement savings plans.

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