Peter L. Bernstein, an economic consultant who sought to bring ideas of modern investment management from academia to the practitioner, died Friday in New York.
Mr. Bernstein was president of Peter L. Bernstein Inc., an economic consulting firm to institutional investors and corporations that he founded in 1973.
He was the author of Capital Ideas: The Improbable Origins of Modern Wall Street; an updated volume, Capital Ideas Evolving; and Against the Gods: The Remarkable Story of Risk, among other books and articles about investment management, the markets and risk.
Peter was a most effective evangelist for leading-edge investment thinking, instrumental in helping to move that thinking from the edges of academia to the very heart of investment practice, Bruce I. Jacobs, principal, Jacobs Levy Equity Management, said in an e-mail.
He definitely was a believer in efficient markets and all the academic theory based on efficient markets, including the capital asset pricing model and the options pricing model, Mr. Jacobs said in an interview earlier today.
Mr. Jacobs said his last contact with Mr. Bernstein was two weeks ago. Mr. Jacobs sent Mr. Bernstein the upcoming Bernstein Fabozzi/Jacobs Levy Award winners for his endorsement. The annual awards are given for outstanding articles in the Journal of Portfolio Management, which Mr. Bernstein founded in 1974.
His signature came back and we were concerned because it was weak," Mr. Jacobs said.
He was a giant in the investing world, Theodore R. Aronson, principal at Aronson + Johnson + Ortiz, said in an e-mail sent while traveling in Italy.
To the very end, he was contributing mightily to our thinking about and appreciation of economics. He will be sorely missed and can never be replaced, Mr. Aronson said.
I am in the north of Italy, with tears in my eyes and warmth in my heart thinking about Barbara and Peter Bernstein, Mr. Aronson added. I knew Peter for 25 years. Peter forgot more about investing than most investors will ever know. He loved to joke that he made his biggest mistakes after he was right! His generosity of spirit and time was legendary; he was many, many folks Jewish uncle. I vividly recall joking with Peter that, only after reading Capital Ideas had I realized I started in the investing world at square one of the quantitative revolution.
Harry M. Markowitz, 1990 Nobel laureate in economics and adjunct professor in finance, Rady School of Management, University of California, San Diego, said: I hadnt heard about Peter dying. Im slightly in a state of shock. Peter was a good friend. He had this fantastic way to explain mathematical concepts to non-mathematicians. I was surprised to learn he was a non-mathematician.
Mr. Bernstein served as a trustee of the College Retirement Equities Fund of TIAA-CREF from 1977 to 1988, according to Chad Peterson, TIAA-CREF director of media relations.
He was a graduate of Harvard University with a degree in economics, magna cum laude.
Information about funeral arrangements and memorials could not be learned by press time.
Mr. Jacobs, in his e-mail, noted: Many professional investors today were introduced to the more sophisticated and quantitatively oriented concepts underlying modern portfolio management through the work of Peter Bernstein.
Whether it was Harry Markowitzs theories of portfolio optimization, or Bill Sharpes capital asset pricing model, or the option-pricing theory of Fischer Black, Myron Scholes and Robert Merton, Peter seemed able to translate the most abstract, arcane ideas into language that was accessible to those of us not necessarily trained in physics and higher mathematics. And he was able to do so in a lively, informal style while keeping all the main points intact, he said.
Peter noted over 50 years ago that no trend can go on forever, Mr. Jacobs added in his e-mail. Yet his contributions spanned many decades, with no signs of wavering in terms of volume, creativity, and originality, and they will continue to shape our world.