Student Managed Investment Fund
Real Money. Real Results.
Student Managed Investment Fund (SMIF) provides students the opportunity to manage and administer an investment portfolio. This allows students to gain a hands-on experience in the field of finance by allowing them to manage a portfolio of investments rather than running simulations. Such an opportunity is rare among business schools across the country and the experiential learning has proven invaluable.
Students work in small groups conducting research and analysis of different companies and securities. They then present formal investment recommendations to the faculty advisor, senior officers, and the entire group. Students are responsible for managing all aspects of the Investment Fund: research, investment management, administration and client services.
This provides enormous benefits to the members of SMIF by allowing students to practice the skills they have learned in their academic careers. In addition to improving those quantitative and qualitative research skills, the SMIF will also help to advance career opportunities after graduation.
S&P 500
|
Year |
Balanced Fund |
SMIF Equity |
S&P 500 |
|
2007 |
NA |
8.30% |
5.50% |
|
2008 |
NA |
-42.10% |
-36.80% |
|
2009 |
NA |
42.30% |
26.40% |
|
2010 |
NA |
14.62% |
14.59% |
|
2011 |
NA |
-1.06% |
1.89% |
|
2012 |
NA |
10.54% |
15.99% |
|
2013 |
17.62% |
30.25% |
32.31% |
Goals
- The long-term goal of the Student Managed Investment Fund is to manage a balanced fund that provides the income and capital gains necessary to support the on-going operation and advancement of the Kirk Lanterman Investment Center.
- Provide students the opportunity to gain experience with different types of securities.
- Support additional educational activities such as attending the Rise Competition, bringing in professional speakers, additional technology enhancements are the industry progresses.
Investment Policy Statement
Our primary strategy for investment decisions is to find undervalued securities and hold those securities until their value is fully realized by the market. We also monitor trends in macroeconomic factors such as interest rates, Federal Reserve policy, inflation, and the state of the overall economy. The performance target is to meet or exceed, net of fees, the benchmark indices while maintaining a relatively low risk portfolio structure. Performance targets are met by investing in conservatively financed, undervalued companies that show considerable growth potential. Additionally, risk management is critical and should be measured and controlled through proper monitoring of active exposures relative to the stated benchmark.
The Student Analysts carefully implement the investment strategy by employing the top down philosophy. Members first identify the major economic trends with regards to inflation, interest rates, and Federal Reserve Policy. Taking into consideration conclusions drawn from economic research, the next step in the investigation process is to identify sectors that appear to offer advantages with regard to the economic conditions previously identified. Once the Student Analysts have concluded what sectors they believe will outperform the benchmark, they focus on identifying the best companies within those sectors.
This investment process focuses on fundamental research to make decisions on which stocks the fund should be holding. Using this research, the investment teams establish their estimate of a target price for the stock. The weight of each security in its respective portfolio is determined based on the investment team's desired exposure to a given industry as well as to the individual security.
Implementation
Students must apply for the SMIF, and the faculty advisor and Senior Officers select students for the fund.
Course requirements include asset allocation decisions, preparing and presenting security research reports, implementing investment decisions, monitoring portfolio performance, compliance with investment guidelines, making decisions regarding portfolio adjustments, record keeping, portfolio performance evaluations, and making presentations to the faculty advisor and student analysts. The Kirk Lanterman Investment Center is the key component in effectively implementing all activities required in the management of the fund.
Funding
The Student Managed Investment Fund is a group that invests real money into a variety of portfolios. In 2016, they were allotted $1.3 million for investments. It is one of the only fully student-run investment fund groups in the nation and is an opportunity only available to business students. Currently, the group has somewhere between 30 and 35 members.
R.I.S.E Competition
The University of North Dakota Student Managed Investment Fund has competed annually in the RISE (Redefining Investment Strategy Education) Competition which takes place in Dayton, Ohio. This three day event gives students the opportunity to interact with leading thinkers in economics and finance. Students learn about investment strategy by putting their strategies to the test while managing real money in this annual competition.
ENGAGE Symposium
New in 2015 is the ENGAGE (International Investment Education) Symposium. The University of North Dakota will participate at the world’s largest student investment conference in Detroit, MI in March. The ENGAGE symposium is a great opportunity for students to hear insights from featured speakers that are among the best and brightest in corporate America, government, and the financial media. The Student Managed Investment Fund will also participate in the portfolio competition against other Universities.
GAME Forum
The University of North Dakota Student Managed Investment Fund competes annually in the GAME (Global Asset Management Education) Forum, which takes place in New York City in March. The forum gives students the unique opportunity to interact with industry leaders and learn best practices in investment management. Students learn about the global economy, global markets, alternative assets versus equities, corporate governance, and Federal Reserve Perspectives. In 2016, the group ended up placing first in two categories: bond portfolio and alternative funds. While they have placed first in bond portfolio once before, it was their first time winning in the alternatives category.