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Making connections with students and through research

Riccardo Colacito of UNC Kenan Flagler at McColl Building

The people drew Riccardo Colacito, a finance professor, to UNC Kenan-Flagler Business School. Upon completing his PhD at New York University, he was looking for a place where he could flourish with good colleagues.

“I felt at the time – and still do – that UNC Kenan-Flagler was the best fit,” says Colacito. “These are the people I wanted to do research with.”

Since he arrived in 2006, Colacito has made his mark with award-winning research. His areas of research are international finance, financial econometrics, model uncertainty, experimental economics and climate change.

Although research seems like a solitary pursuit, Colacito says teamwork is a priority. “It’s important to have the opportunity to work with each other and discuss a paper with those who know the field well,” he says. “It makes a big difference during the process.

Colacito’s research has earned him attention. He has been invited to present his work and discuss the work of other scholars at over 100 seminars and conferences across 20 countries and five continents. His paper “Volatility Passthrough” received the best paper award at the 2018 International Finance Conference in Oslo.

In “Temperature and Growth: A Panel Analysis of the U.S.,” he and his co-authors demonstrate the connection between climate change and economics. It garnered a lot of attention: It was cited in the Joint Economic Committee of the U.S. Congress to the 2019 Economic Report of the President” and in major news outlets, including The Wall Street Journal, Bloomberg, CNN and CBS.

Colacito’s work also earned him the role as a research associate at the National Bureau of Economic Research (NBER). “I’m honored to have been asked to be among these scholars, an esteemed group of academic researchers that include some of the very best in the field,” he says.

Colacito has won awards for his teaching, including the Weatherspoon Award for Excellence in PhD Teaching. He tries to develop enduring relationships with his students. “They know they can come and talk to me anytime they want,” he says. “We keep up with each other after the class is done.”

With students in the Undergraduate Business MBA and PhD programs, Colacito enjoys their range of ages and career levels. The undergrads are just starting to bloom, the MBAs draw on their experience and the PhDs are aiming to land academic positions that include teaching and research.

With all of his students, Colacito witnesses their growth and helps them navigate what’s to come after graduation.

“I would define the relationship with PhD students as the most profound because it’s a very small group,” he says. “When you advise a student, it becomes personal because you’re talking about their ideas and their emotional journey. Sometimes, you work for months on research and the work gets discarded and there’s so much stress. They become part of your extended family.”

One of the unique classes he is involved with is the MBA Applied Investment Management course. Students are responsible for all aspects of managing a portfolio with real money. In the end, they present the portfolio’s performance to industry experts who make up the board.

“They have to defend all their decisions – the good, the bad and the ugly,” says Colacito. “They face all the tough questions.”

As the director of Capital Markets and Investments concentration for the Full-Time MBA Program, Colacito is impressed by the successful alumni who return to run a workshop where they provide a detailed account of how to evaluate companies and price stocks. Ahead of career recruiting, these focused lessons help students network and retain key knowledge.

It also prepares them for the UNC Kenan-Flagler Alpha Challenge, one of the world’s premier investment management challenges and interview hubs for recruitment. Students aspiring to build careers in investment management experience a full day of formal interviews and compete as part of three-person teams with teams from other top MBA programs to pitch their long and short ideas to a panel of distinguished judges from investment management and buy-side firms.

“This is exactly the kind of opportunity that any student with an interest in the investment management industry is looking for,” says Colacito.

In all his teaching, Colacito remains dedicated to using information that relates to current events to think creatively and tackle subjects they will encounter in their careers. In spring 2020, when the U.S. began to confront the COVID-19 crisis head on, Colacito was teaching investment and assets classes to Undergraduate Business and MBA students who have come to expect a strong focus on the headlines.

Colacito teaching in the Capital Markets Lab

“A lot was happening in real time,” says Colacito. “It was very interesting to condense information and help them navigate it as we were experiencing it. It was definitely interesting because there was a lot of material to talk about. It was fulfilling for me and, I think, for the students.”

Colacito is excited about contributing to the School in a new way. He’s working with colleagues to overhaul the Undergraduate Business Program core curriculum and he welcomes the opportunity to innovate and rethink the educational needs of students.

His dedication to academic pursuits dates back to earning his bachelor’s and master’s degrees at Bocconi University in Milan. A native of Macerata, a city in Italy’s central Marche region, Colacito took advantage of Bocconi’s study abroad options and traveled to San Diego.

“It made me appreciate university life in the United States,” he says. “It is one of the reasons I subsequently came here to study and work.”

Colacito met his wife, Anna Bassi in Milan. She also earned her PhD at NYU (her second) and she is a political science professor at UNC. “Dual academic careers are so tough. It’s a blessing to work together at a great University,” says Colacito commenting the challenges of combining personal and work aspects of his life.

They usually travel home to Italy with their teenage son, Leonardo, but the pandemic prevented a 2020 trip. To keep their Italian roots strong, they speak to their son in Italian and share their passion for soccer.

“My son knows there is a time on Saturday or Sunday when I’m watching a Juventus game and our living room turns into the stands of an Italian stadium,” says Colacito.

The family has taken up a new Italian pastime during quarantine: making pizza from scratch. They even purchased a proper pizza oven to ensure the temperature would be high enough.

“The process of making dough,” says Colacito, “and then baking the pizza is really relaxing.”

Still, he won’t be trading in his academic life to become a pizzaiolo. In his career, Colacito has collaborated on research with his former professors Robert F. Engle III, Lars Peter Hansen and Thomas J. Sargent – Colacito’s PhD advisor – who all have won the Nobel Prize in economics. In his office, Colacito’s Weatherspoon Award hangs next to a picture that Sargent signed for him when he won the Nobel Prize in 2011. It reads, “To Ric. Love, Tom.”

“He taught me a lot in terms of how to do good research and what it means to be committed to your PhD students,” says Colacito. “There is a lot of what I have learned from him reflected in my Weatherspoon Award for PhD teaching, too.”

Those lessons are now getting passed on to UNC Kenan-Flagler PhD students who work with Colacito. It is the circle of academic life.