Faculty at University of Marylands Smith School of Business Win Smith Breeden Award

College Park, Md. January 24, 2007 The American Finance Association has honored two professors at the University of Marylands Robert H. Smith School of Business with the prestigious Smith Breeden Distinguished Paper Prize. Gregory Willard and Mark Loewenstein won the award for their paper, The Limits of Investor Behavior, published in the February 2006 issue of the Journal of Finance. The prize was presented at the associations annual conference, held January 5-7 in Chicago.

The Smith Breeden Prizes are extremely competitive and are annually awarded by the Journal of Finances associate editors for the top three papers covering any area other than corporate finance. This year the papers eligible for consideration included all those that appeared in the first five issues of 2006 and in December 2005.

The highly coveted Smith Breeden Prize is awarded to a limited and elite group of researchers, said Howard Frank, dean of the Robert H. Smith School of Business. This is a great measure of the caliber of the Smith Schools finance department faculty and we're pleased to see them recognized for making significant advances in the field.

Willard concentrates his research on the equilibrium properties of asset prices. He has shown that several of the phenomena observed in actual financial markets may be the natural consequences of optimal and rational economic behavior. Willard earned his PhD from Washington University.

Loewensteins research interests include asset pricing, portfolio selection, and employee compensation valuation and design. His recent work focuses on asset pricing when there are limits to arbitrage; portfolio selection when investors face transactions costs; and valuation of employee stock options. Loewenstein earned his PhD from Columbia University.

In addition to the Journal of Finance, Willard and Loewenstein have published research in influential journals that include the Review of Financial Studies and the Journal of Economic Theory.

The Smith Breeden prizes are funded by Smith Breeden Associates Inc., a fixed-income investment management firm. The prize for the best paper is $10,000 and the two prizes for distinguished papers are $5,000 each.