Endowment Shenanigans????

I just came across something that made me say WTF? Apparently there is a course through the MBA program called the Student Managed Investment Fund (SMIF). In this two semester course students invested real money provided by the endowment fund, approx $240k from the instance I was shown. It was a real fund that was benchmarked against the S&P 500. Students are responsible for providing a mid year and annual report to the provost detailing our investment strategy, buy/sell decisions and overall performance. Though there were two faculty advisors, all investment decisions were made solely by the students.

http://www.belkcollege.uncc.edu/smif

Does this seem to be the best use of 250K of the endowment?

[QUOTE=s9er;385259]I just came across something that made me say WTF? Apparently there is a course through the MBA program called the Student Managed Investment Fund (SMIF). In this two semester course students invested real money provided by the endowment fund, approx $240k from the instance I was shown. It was a real fund that was benchmarked against the S&P 500. Students are responsible for providing a mid year and annual report to the provost detailing our investment strategy, buy/sell decisions and overall performance. Though there were two faculty advisors, all investment decisions were made solely by the students.

http://www.belkcollege.uncc.edu/smif

Does this seem to be the best use of 250K of the endowment?[/QUOTE]

I really would not call this a shenanigan since it gives real world experience to the students. This is a program that the business department has had for quite sometime. Many other universities have programs similiar to this for much more at risk. I personally was never in the program but I support that they should continue with it.

[QUOTE=s9er;385259]I just came across something that made me say WTF? Apparently there is a course through the MBA program called the Student Managed Investment Fund (SMIF). In this two semester course students invested real money provided by the endowment fund, approx $240k from the instance I was shown. It was a real fund that was benchmarked against the S&P 500. Students are responsible for providing a mid year and annual report to the provost detailing our investment strategy, buy/sell decisions and overall performance. Though there were two faculty advisors, all investment decisions were made solely by the students.

http://www.belkcollege.uncc.edu/smif

Does this seem to be the best use of 250K of the endowment?[/QUOTE]

It is insane that they are using real dollars. That endowment should not used to to provide real world experience with real dollars. There are plenty of programs out that the replicate real world trading that would give students the exact same experience without risking that sum of money. I would def call shenanigans on that!

[QUOTE=bleedsgreenandgold;385261]I really would not call this a shenanigan since it gives real world experience to the students. This is a program that the business department has had for quite sometime. Many other universities have programs similiar to this for much more at risk. I personally was never in the program but I support that they should continue with it.[/QUOTE]

With the size of our endowment, I think professionals with a vested interested in the sucess of the program, not students with nothing to lose should be running with it. You can learn without having skin in the game.

I just came across something that made me say WTF? Apparently there is a course through the MBA program called the Student Managed Investment Fund (SMIF). In this two semester course students invested real money provided by the endowment fund, approx $240k from the instance I was shown. It was a real fund that was benchmarked against the S&P 500. Students are responsible for providing a mid year and annual report to the provost detailing our investment strategy, buy/sell decisions and overall performance. Though there were two faculty advisors, all investment decisions were made solely by the students.

http://www.belkcollege.uncc.edu/smif

Does this seem to be the best use of 250K of the endowment?

If real-world experience for students is a shenanigan, then yes it was a poor use. Otherwise, no.

With the size of our endowment, I think professionals with a vested interested in the sucess of the program, not students with nothing to lose should be running with it. You can learn without having skin in the game.

These students are not managing the endowment, they are managing the investments with the portion they were allowed to use.

How are they tricking anyone with this? You can follow the portfolio and what they are investing it in. The government is giving your tax dollars to people who are fiscally irresponsible with their mortgage decisions and you want to criticize a program that has historically made sound decisions…I don’t get it?

[QUOTE=scollie41;385267]If real-world experience for students is a shenanigan, then yes it was a poor use. Otherwise, no.[/QUOTE]

There is a big… huge… massive difference between risking your own money, or your clients money and running a project to go heads up vs the 500. You can learn a lot on paper, you don’t need a trade confirm to make it sink in.

What is the difference between playing Monopoly and playing Monopoly with real $$ that some one else gave you that you can’t keep when the game is over?

There is a big.. huge.. massive difference between risking your own money, or your clients money and running a project to go heads up vs the 500. You can learn a lot on paper, you don't need a trade confirm to make it sink in.

What is the difference between playing Monopoly and playing Monopoly with real $$ that some one else gave you that you can’t keep when the game is over?

Every big time MBA program has something of this sort in their program. If UNC Charlotte wants to move to the forefront with their MBA program, this is the type of program they need to entice high level students to enroll.

Other schools have funds involving much more than $250k.

If you want to complain about something, follow this guy’s lead

http://www.youtube.com/watch?v=bEZB4taSEoA

[QUOTE=Charlotte2002;385274]Every big time MBA program has something of this sort in their program. If UNC Charlotte wants to move to the forefront with their MBA program, this is the type of program they need to entice high level students to enroll.

Other schools have funds involving much more than $250k.[/QUOTE]

I very much like the idea of SMIF. However the web site is stale so is it still going on? I also noticed the last reported annual results where no better than the S&P 500. When you look at the portfolio, it’s no wonder-> Seems to be general, no real focus.

Suggestions:

  1. Need SMIF members to ante in $1k to $5k each for a SMIFers Fund-> Nothing like playing with your own money verse the house to bring a real steely eyed focus to your investments.

  2. SMIF broken into segments -> Winning segment of SMIFs (of course must be greater than zero) gets a bonus payout from the SMIFers Fund.

That would be really interesting.

There is a big.. huge.. massive difference between risking your own money, or your clients money and running a project to go heads up vs the 500. You can learn a lot on paper, you don't need a trade confirm to make it sink in.

What is the difference between playing Monopoly and playing Monopoly with real $$ that some one else gave you that you can’t keep when the game is over?

We allow our architects and engineers to actually build things so why can’t an MBA actually invest money? An architect can learn a lot on paper but nothing can replace being able to touch a building and see how the pieces fit together. It’s the same thing but you are just focused on this being endowment funds. What percentage of the endowment does this represent?

Also, will you complain two years from now when the market is growing steadily and they are making money?

this student lead fund has typically outperformed the professionally managed endowment fund.

this kind of learning and success is the stuff we should be praising, not ridiculing. this is the stuff to brag about.

from their 06-07 annual report:
[I]
“The SMIF team managed the portfolio from August
23, 2005 to March 31, 2006. During this seven-month period,
the team increased the portfolio holdings from $199,850 to
$226,975. [B]This increase represents a gain of $27,125 or
about [/B][B]13.57%. Our fund’s benchmark, the Standard & Poor’s 500 Index, returned [/B][B]6.35% during the same period.[/B] This exceptional performance can be attributed to the team’s
disciplined approach to stock selection.”[/I]

[QUOTE=49erPress;385305]this student lead fund has typically outperformed the professionally managed endowment fund…[/QUOTE] I would hope it does every year. Managing a client based on a risk profile and beating the S&P are two completely different things.

[QUOTE=49erPress;385305]this kind of learning and success is the stuff we should be praising, not ridiculing. this is the stuff to brag about.[/QUOTE] Good for them, but this is experience that can be gleaned without using real dollars.

This program would be a lot better if they used Fantasy Dollars.

That less than we’re wasting on a coach that only wins 1/3rd of his games.

Good for them, but this is experience that can be gleaned without using real dollars.

The risk with real dollars, is well, real risk. That is something that cannot be duplicated on paper.

With that being said, I’m sure there is an expected level of performance but also an understanding that these dollars are being risked, possibly moreso than the remainder of the endowment.

UNC-CH MBA has a fund that is over $1.2 million that is run by students.

Not sure what the big deal is with all of this. I wish I could have been involved with it when I was in school.