Jean-Marie Choffray was investigating the role of the Internet as a global investment platform long before the current financial crisis. The consequences of today's crisis on financial actors, including investment banks, insurance companies, pension funds and other hedge funds, continue to be debated far and wide. As the author stresses, this exceptional situation "invites modesty and underlines the necessity of questioning the relevance of the concepts, models and decision-making tools to which institutional and individual investors turn". The analysis which he presents covers the dynamic behaviour of markets, of businesses and of investors.
Written in the early summer of 2011, L'Art d'Investir Avec Internet is the result of ten years of research by Jean-Marie Choffray, chair professor of Management Science at the Graduate School of Business of the University of Liège (HEC-ULG), on the use of the Internet as a global investment platform (1). His goal is to "combine data (web sites), concepts, heuristics and models, into a coherent set of operational principles for investment decision making. These principles should help you, as they helped me, develop more efficient investment strategies. Before adopting them, however, don’t hesitate to challenge these principles and validate them for your specific use ".
The recent financial meltdown has led many commentators to question the role which investors, whoever they may be, have played in the development of this crisis. Some have argued that markets conceal more uncertainty than previously thought, and that information is never totally complete. Others have stressed the role of evil speculators. Still others have not hesitated to immediately throw financial theory into question. In the midst of all this confusion, Choffray presents an original approach pointing to the emergence of a new discipline.
A new discipline
As he explains, his interest in the 1980s for models of market response, applied computer science, and intelligent management systems, led him to observe the emergence of a new discipline: Internet-Based Global Investing. "This discipline is at the crossroads of IT, statistics, psychology, and finance. It is a new ecosystem which is likely to lead to the development of major innovations in the fields of computer networks, statistical analysis, and real time investing. Finally, this is an exceptional opportunity for both individual and institutional investors, who finally find themselves at the core of what I call World Street."
This new discipline was born with the Internet. Just as the personal computer changed information management, so the Internet has revolutionised the management and the allocation of the world’s stock of capital (savings). The international financial landscape has been totally transformed by the Web. Financial market operators are permanently interconnected wherever they are in the world: "Instant access to all information published by market participants and listed companies, the availability of powerful diagnostic tools, and the ability to buy or sell all financial products in real time, contribute to the creation of a new space of freedom, equality and responsibility. This is an exceptional opportunity to leverage the skills of companies and the intelligence of their managers - or the expertise of any motivated person - through the use of proactive strategies aimed at value creation, and based on investments made around the world using the Internet."
(1) Jean-Marie Choffray, chapitre à paraître dans F. Longin, éditeur : Gestion de Patrimoine (Paris, 2011).