William F. Sharpe, STANCO 25 Professor of Finance, Emeritus, Graduate School of Business

William Sharpe received the Nobel Prize in Economic Sciences in 1990 for his contributions to the theory of price formation for financial assets, the so-called Capital Asset Pricing Model (CAPM). The CAPM is considered the backbone of modern price theory for financial markets. It is also widely used in empirical analysis and applied extensively in practical research, and has thus become an important basis for decision-making in many areas. Sharpe is also responsible for developing the Sharpe Ratio for investment performance analysis, the binomial method for the valuation of options, the gradient method for asset allocation optimization, and returns-based style analysis for evaluating the performance of investment funds. The fields of financial economics and investment have both been dramatically transformed by Sharpe’s theories and models.

William Sharpe has written hundreds of articles and seven books on financial markets and investing. He received a PhD from UCLA, is the recipient of several honorary doctorates, and is past president of the American Finance Association. He joined the Stanford faculty in 1970.

Professor Sharpe will be introduced by his distinguished colleague James C. VanHorne, A. P. Giannini Professor of Banking and Finance, Emeritus, former Deputy Assistant Secretary of the Treasury, and past president of the American Finance Association.