Editing Robert C. Merton (section)

==Research==
Merton's research focuses on finance theory including lifecycle finance, optimal intertemporal portfolio selection, capital asset pricing, pricing of options, risky corporate debt, loan guarantees, and other complex derivative securities. He has also written on the operation and regulation of financial institutions. Merton's current academic interests include financial innovation and dynamics of institutional change, controlling the propagation of macro financial risk, and improving methods of measuring and managing sovereign risk. He is the author of ''Continuous-Time Finance'', and a co-author of ''Cases in Financial Engineering: Applied Studies of Financial Innovation'' and ''The Global Financial System: A Functional Perspective; Finance; and Financial Economics''. Merton was a founding co-editor of the ''[[Annual Review of Financial Economics]]'', serving from 2009 to 2021.<ref>{{cite journal |last1=Lo |first1=Andrew W. |last2=Merton |first2=Robert C. |title=Preface to the Annual Review of Financial Economics |journal=Annual Review of Financial Economics |date=5 December 2009 |volume=1 |issue=1 |pages=01–17 |doi=10.1146/annurev-financial-071808-145225 |url=https://www.annualreviews.org/doi/10.1146/annurev-financial-071808-145225 |access-date=16 September 2021|hdl=1721.1/66557 |s2cid=154747017 |hdl-access=free }}</ref><ref name="Lo">{{cite journal |last1=Lo |first1=Andrew W. |last2=Merton |first2=Robert C. |title=A Look Back and a Way Forward |journal=Annual Review of Financial Economics |date=1 November 2021 |volume=13 |issue=1 |pages=v–viii |doi=10.1146/annurev-fe-13-090321-100001 |s2cid=240443908 |url=https://doi.org/10.1146/annurev-fe-13-090321-100001 |access-date=27 January 2022 |language=en |issn=1941-1367}}</ref>

Merton has also been recognized for translating finance science into practice. He received the inaugural Financial Engineer of the Year Award from the International Association of Financial Engineers in 1993,<ref>{{cite news |url=http://news.cornell.edu/stories/1997/08/cornell-management-expert-named-financial-engineer-year |title=Robert Jarrow is cited as one of the world's leading finance theorists |last= Hittleman|first=Margo |date=19 August 1997 |newspaper=[[Cornell Chronicle]] |access-date=5 February 2018 |quote=Past recipients of the Financial Engineer of the Year award include Robert Merton (Harvard), Fischer Black, Mark Rubinstein (Berkeley) and Stephen Ross (Yale).}}</ref> which also elected him a senior fellow. ''Derivatives Strategy'' magazine named him to its Derivatives Hall of Fame in 1998<ref name="Persson">{{cite book |last1=Persson |first1=Torsten |title=Economic Sciences, 1996-2000 |date=2003 |publisher=World Scientific |isbn=978-981-02-4961-8 |url=https://books.google.com/books?id=6zjTc0SR--oC&pg=PA77 |language=en}}</ref> as did ''Risk'' magazine to its Risk Hall of Fame in 2002. He also received Risk's Lifetime Achievement Award for contributions to the field of risk management in 2003.<ref name="Read">{{cite book |last1=Read |first1=C. |title=The Rise of the Quants: Marschak, Sharpe, Black, Scholes and Merton |date=7 June 2012 |publisher=Springer |isbn=978-1-137-02614-9 |url=https://books.google.com/books?id=XSkElfR6kIIC&pg=PT120 |language=en}}</ref> A distinguished fellow of the Institute for Quantitative Research in Finance ('Q Group', 1997)<ref name="nobelprize.org"/> and a fellow of the Financial Management Association (2000),<ref name="FMA"/> Merton received the Nicholas Molodovsky Award for Outstanding Contribution to Investment Research from the [[CFA Institute]] (2003).<ref name="CFA">{{cite web |title=CFA Institute Awards |url=https://www.cfainstitute.org/-/media/documents/corporate-record/award-recipients.pdf |website=CFA Institute |access-date=27 March 2023}}</ref>

His first professional association with a hedge fund came in 1968. His advisor at the time, [[Paul Samuelson]], brought him on board Arbitrage Management Company (AMC), to join founder [[Michael Goodkin]] and chief executive [[Harry Markowitz]]. AMC is the first known attempt at computerized arbitrage trading. After a successful run as a private hedge fund, AMC was sold to Stuart & Co. in 1971.<ref>Goodkin, Michael. ''The Wrong Answer Faster: The Inside Story of Making the Machine that Trades Trillions''. John Wiley & Sons, 2012</ref> In 1993, Merton co-founded a hedge fund, [[Long-Term Capital Management]], which earned high returns for four years but later lost $4.6 billion in 1998 and was bailed out by a consortium of banks and closed out in early 2000.<ref>{{cite news |url=https://www.barrons.com/articles/a-good-time-for-caution-in-the-markets-1499489952 |title=A Good Time for Caution in the Markets |last= Sears|first=Steven |date=8 July 2017 |newspaper=[[Barron's (newspaper)|Barron's]] |access-date=5 February 2018 }}</ref><ref name="Edwards">{{cite journal |last1=Edwards |first1=Franklin R. |title=Hedge Funds and the Collapse of Long-Term Capital Management |journal=The Journal of Economic Perspectives |date=1999 |volume=13 |issue=2 |pages=189–210 |doi=10.1257/jep.13.2.189 |jstor=2647125 |url=https://www.jstor.org/stable/2647125 |issn=0895-3309}}</ref>