Launching a sequel is tricky business, whether it's a movie or a course on investments. We all shoot for an empire strikes back success. It was a great sequel, best ever in my view. The bad guy needs to win sometimes, right? But often you end up with a less and satisfying phantom menace and charge our binks experience. No offense, but that's pretty bad. What will Investments II lessons and applications for investors be like? Will it be better than my first offering or another sequel flop? I've actually been thinking about it quite a bit. I'm hoping it will turn out like this. Avoid the dark side of [inaudible] With my investment course, you can move your financial galaxy. But I'm afraid it might turn out like this. I think that Investments II must too be twice as good as Investments 1. Not so good with numbers. I buy stocks that sound funny. Twitter sounds funny. How will my second investments course turn out? Will it have a lot of memorable moments like. Look, I'm your father or will you be thinking about, cringe worthy jar jar bink scenes as you are taking this course? Can you watch the sequel without having done my first investments course? Why don't we get out of here and talk about it? Frankly, if you're an investor you can't afford not to. Scotty beam me up, warp speed ahead. Rondo be. Oh, right. Let the force of my investments course be with you. Well, it turns out the jet lag traveling from space isn't nearly as bad as you would think. Welcome to investments, actually Investments II. I'm Scott Weisbenner in the William G. Karnes Professor of Finance at the University of Illinois at Urbana-Champaign, and I'm delighted to offer you this course on investments. A little background information for me if you're interested, please visit my website. You'll see this cool, looks like it's photoshop, but it's not a photoshop picture of me in the Chinese suit, and you get also to see my Chinese name, Weiss Subwah. You can find out what research I do as well if you're interested in that, just a little background to who am I. I'm a professor of finance. I've been here at the University of Illinois since 2000. I teach courses in various programs, executive MBA, MBA, MSF, Masters of Science in Finance, Coursera, and I teach a variety of courses, investment finance, corporate finance, behavioral finance. You may have heard the phrase publish or perish. Research is very important in most universities. Have you ever heard the phrase teaching or tombstone, probably not because it doesn't exist. The emphasis is on research, but I want you to know that actually do care a lot about teaching. I've had the great fortune to get many teaching awards from students. I hope that shows my dedication to try and give you as good of product as possible. I was actually very gratified. I was told by people at Illinois that my first Coursera course was the highest rated MOOC among those offered by Illinois, and actually the highest rated investments course on Coursera. A big shout out and thanks for all the learners out there. I appreciate your feedback, your comments. It's just really remarkable experience. I appreciate that a lot. I'm really excited about this course for three particular reasons. First, this emphasis I have on lessons and applications for investors. I want to be very inclusive in this course answering the question, you can watch the sequel without having done my first course and I encourage you to do it. Obviously, if you want to see that first course first, great. But if not, feel free to jump in on this second course, I actually feel the sequel is better than the original. So let's talk about each of these three points a little bit more. So first, Investments 2: Lessons and Applications for Investors. I try to stay true to this title. The emphasis is on key empirical findings from high-quality research by leading academics that will tell us about the performance of various investments and investors. I'm always emphasizing results with practical consequences for you and your financial decision-making. I'll go through looking at regression results. But I'll always come back to what's the bottom line for you to be thinking about as someone who has to make financial decisions. The course is broken down into four modules. The content, I think is roughly 12 hours or so. Let's talk about these modules in turn. Module 1, fundamentals and compositions of returns. So this is where I get everyone up to speed by going through the fundamentals of investments, talking about basic return risk tradeoffs, the capital asset pricing model, three-factor model, regression analysis, a primer to get everyone up to speed. Then I also talk about the two types of returns investors can get, dividends and capital gains and the tax consequences that flow from each getting these types of returns. Module 2, what do we know about the investment decisions made by participants in defined contribution pension plans and thinking about what are some behavioral biases we observe and then how can you as someone saving for retirement, not make those mistakes. Module 3, we'll be talking about the performance of individual investors, particularly in the context of trading stocks. How do individual investors do? Are there some key behavioral biases that a lot of them may be subject to loss aversion is a key one. We'll also talk about, has the nature of individual stock investors changed over time. Then Module 4, it's all about what's the performance of mutual funds. Most households will have savings and mutual funds. Do higher fees lead to better performance? Usually think higher price better. Is that the case when it comes to mutual fund fees and I'll also give some examples of some strategies designed to search for Alpha. So all of this in Investments 2. Feel free to watch the sequel first. It's great if you want to take my first course, which is now called Investments 1: Fundamentals of Performance Evaluation. If you want to take that before this course, great. But I designed this course to potentially be a standalone offering. As I just talked about Module 1 we'll have a review of what you need to know about the capital asset pricing model, multi-factor models, and regression analysis. So I just want to be inclusive here. Everyone is welcome. Why am I so excited about this course? I think it's a great blend of popular components from my first offering with several new features. As I just mentioned, I want this to be inclusive to a broad audience. There's going to be no assignments requiring Excel expertise or in-depth statistics knowledge. I just want to give you the bottom line about what we know about the performance of investors and various investments. What old features will you see in this course? A course, [FOREIGN] is going to be back. How can I have a course without him? In fact, you're going to see him over 40 times in this course. Whenever you see him, that's a sign like, time to put on your thinking cap. Guys are asking me a question to think about, then I'll give you my response after the short break. Stay tuned. I may be the only one that likes this animation, but it's back here. When you see this, there'll be highlighting like, here's an upcoming attraction. Here's something that'll be coming later in the course. What other features will you see in this course? Old reliable blue shirt, dog tie. We actually had some focus groups. It turns out the blue shirt is very appealing to the eye. I know I have a lot of videos, so that's important. Also I consider different ties. People like dogs. It turns out when I wear the dog tie, people will watch the videos longer. Blue shirt, dog tie consistently throughout the lectures. Same expansive waistline as before. One of the things that I notice this time, we're going to have a lot of interviews, in which case I'm like this. You really see the waistline on full display in these Faculty Focus interviews and not so much with a straight-on shot, but some embarrassing moments here sitting with the Faculty Focus interviews. Then, same lame attempts at humor. We're still trying to figure out, are people laughing with me or are they laughing at me? We talked about some old features. What are some new features you're going to see in this course? Out-of-studio scenes to introduce all four modules. For Module 1, this high-stakes poker game will introduce our thinking about, what stocks should we sell, what stocks should we buy. Does a tax core give any incentives? This is really a great piece of work. The rumor is that this scene that we put together for you is actually going to be a nominated for an Academy Award for best introduction to a module for a Coursera course. Module 2, introduced here, talking retirement plans with my son Luke. There's going to be a shocking and unexpected revelation from Luke as to what his favorite character is in the Finding Dory movie. Stay tuned for that. Introduction to Module 3, shot at the local favorite bar here, shooting darts at the financial page. Stay tuned to a second 50 in the clip where I have to throw this money shot dart. See how well that works out. Then finally, the introduction to Module 4. I met the track, I'm testing three mutual fund racers here, lining them up on the track based on their expenses. You'll want to be sure not to miss that. We're also going to have, besides these out-of-the-studio scenes to introduce a module, we'll have a very snappy module in 60 segments. Here you'll love this graphic where then I'll summarize what we're doing in the module in 60 seconds. Faculty Focus interviews, I referenced this earlier. We're going to have a series of four episodes or interviews of this. You have to love this logo here actually my wife designed this. It's a family affair here. The first interview we'll be with Dean Brown. He'll bring out the big guns right away. The first interview with Dean Brown, four total throughout the course. Key thing to look out in these interviews is the final segment of the interview, which is called the awkward moment. This is where I ask a tough question to the guest. For example, we'll find out the answer to such questions as, what does the I in IMBA stand for? Am I going to be replaced in the video with actors in the future? We may also uncover some of the mystery behind the timing of when Russia invaded or entered Georgia, depending on your perspective, in August of 2008. Stay tuned for these awkward moments at the end of these Faculty Focus segments. There's more. This is amazing. We're going to summarize each module with the help of animations. You may say, Scott, I don't have 12 hours to watch your course. Well, do you have 20-30 minutes to see it all summarized with the help of animations? I'm going to be helped with animation, Scott., look at this trim waistline, look at all this hair. I love this guy. Here's an animation where we're talking about default policy and pension funds and how the default can be good or bad for your saving. Here's an animation where are also emphasizing this race. Between index funds and actively managed funds, which one will give you the higher return in the end? Checkout, we're going to have a summary of each module with the help of animations and then put those all together and we have a summary of the whole course with the help of animations. In fact, I would actually suggest before you watch a whole course, start by sampling this course summary with animations. Your mom isn't watching. Feel free to have the dessert first. Feel free to start by watching this course summary with animations. We put quite a bit of work into it. I hope it's a great way to illustrate the concepts that we think are important in this course. Now back to the issue, how good is this sequel going to be? To be honest, you never know how things will turn out until they hit the big screen. Ultimately, it's up for you to decide whether this is a hit or a flop. What I can say is, I sincerely hope you have as much fun watching and learning from this course is, I did and the team did putting this together. I can't rule out that there won't be some Jar Jar Binks, cringe-worthy scenes. But I hope you'll have a lot of experiences, a lot of scenes like this upcoming one that was shot with me and my son, Luke. Enjoy. Luke, together you and I could rule this part. By the way, I am your father. No.