Candor Partners
Collaboration with Mike Seigne — Candor Partners Limited
Joerg Osterrieder is not formally affiliated with Candor Partners Limited, but periodically collaborates with Mike Seigne on research and white papers related to share buybacks.
Columbia Law School: Boards’ Dilemma — The Compounding Problem Hidden in Share Buyback Execution Products
Harvard Law School Forum on Corporate Governance: Implementation of Share Buybacks and Their Impact on Corporate Governance
Role Overview
Joerg Osterrieder contributes periodically to an independent research collaboration with Mike Seigne of Candor Partners, assisting on analyses and models for selected papers on share-buyback execution, market microstructure, and governance. Mike leads these efforts; the contributions from Osterrieder support empirical testing, optimisation modelling, and anomaly review.
Technical Insights from Key Papers
Temporal optionality and genetic algorithms. “Temporal Optionality in Share Buyback Execution: An Empirical Anomaly and Value Optimization Approach” examines how brokers strategically modulate trading — waiting for price drops, delaying when prices rise — to increase payout. The paper applies genetic algorithms and Monte Carlo simulations to model optimal trading schedules (papers.ssrn.com). A companion paper, “Temporal Optionality … Brokerage Outperformance”, proposes that brokers can almost always outperform VWAP benchmarks because of this timing flexibility (papers.ssrn.com).
Free-lunch phenomenon. “A Free Lunch for Share Buybacks” argues that specific buyback product structures yield consistently positive fees across market conditions — in effect a “free lunch” for brokers (papers.ssrn.com).
Uncovering anomalies and cognitive biases. “The Mysteries of Share Buyback Execution” identifies three anomalies — trading-schedule anomalies, benchmark paradoxes, and psychological misconceptions — and uses genetic-algorithm simulations to expose misalignments between execution behaviour and shareholder interests (papers.ssrn.com).
Comprehensive analysis of execution inefficiencies. “The Great Deception: A Comprehensive Study of Execution Strategies in Corporate Share Buy-Backs” documents broker-imposed inefficiencies that translate into an estimated USD 8 billion in excess fees over five years and USD 276 billion in share-price risk exposure (papers.ssrn.com).
Methodologies and Models
Genetic algorithms reverse-engineer trading schedules that maximise broker compensation and replicate empirical patterns observed in real-world data (frontiersin.org). Monte Carlo simulations model stochastic share-price paths to compute Value-at-Risk during buyback execution and to stress-test broker-determined schedules (papers.ssrn.com). Empirical anomaly detection then uses trading volume and price-timestamp data to confirm that observed broker behaviour aligns with the modelled strategies (researchgate.net).
Practical Implications
Execution strategy choices should be re-evaluated by corporate boards to ensure alignment with shareholder value rather than benchmark outperformance. Regulatory oversight can support clearer disclosure standards and governance around execution-benchmark mechanisms. Model development continues: genetic-algorithm engines provide testable frameworks for optimising buyback implementation in line with stated corporate objectives.
Summary
The papers’ benchmark analysis critiques “bogus VWAP” — the simple average of daily VWAP — by showing how brokers can exploit benchmark design to schedule trades advantageously (frontiersin.org). The collaboration with Mike Seigne covers technical components, statistics, modelling, and simulations within empirical research on share-buyback execution. The joint work contributes original models and evidence — spanning genetic algorithms, anomaly detection, and governance critiques — to both academic and professional communities.