Student Investment Club Shines at National Symposium
Contact: Robert Strong, 581-1986; George Manlove, 581-3756
ORONO — Members of the Maine Business School investment club SPIFFY drew compliments recently as one of 12 student groups invited to make formal presentations at a national two-day investment symposium in Dayton, Ohio, attended by 1,500 students from 191 universities from 21 countries.
A team of eight students presented their investment strategies and philosophies to a panel of judges, investment management experts from around the country.
“We pitched to them what we buy and when we buy and how we sell when we sell,” says William Sulinski, a senior economics major from Green Lake and co-president of SPIFFY with Scott Reynolds, a senior financial economics and international affairs major from Sanford. “They were supposed to grill us with questions, but they really had no hard questions because we really defined things well.”
SPIFFY stands for the Student Portfolio Investment Fund, begun with $200,000 of endowment funds from the UMaine Foundation in 1993, which now is worth $1.1 million, after several additional infusions of capital from the Foundation coupled with a 10.5 percent return on the student-managed funds over the last decade.
The RISE Forum VI – Redefining Investment Strategy Education symposium was March 30-31.
“After the presentations, at dinner, one of the judges actually sought me out to tell me what a good job our students had done,” says Robert Strong, professor of finance and advisor to the group, who accompanied the students.
“It was amazing, to say the least,” Sulinski says of the experience. “We heard a number of great speakers, including billionaire investor Jim Rogers, Senator Oxley of Sarbanes-Oxley fame, a former Secretary of Commerce, and many other heavyweights in the investment world.”
Judges observing the 12 presentations were particularly impressed with the comprehensive analysis of social, political and economical variables that the UMaine students consider before deciding whether and when to invest in company stock. The 30-35 members of SPIFFY generally meet Monday evenings and discuss possible stock sales or purchases, depending upon information individual members turn up about various companies. The club works the same way an investment firm does and follows the same rules as professional fund management companies that manage all UMaine Foundation funds.
Part of the student presentation included explaining the strategy for investing $16,324 in GMH Communities Trust of Newtown Square, Pa., the company that is building the Orchard Trails student housing complex just off campus in Orono, and $8,787 in a Russian telecommunications firm, Mobile TeleSystems, currently prepping to spend $7 billion-$10 billion expanding its network outside Russia.
After examining the traditional profits, loss and market projection data, students discussed the economic stability of Russia under President Vladimir Putin’s government, the growth potential for cellular telephones in Eastern Europe and whether the Russian government would interfere with Mobile TeleSystems operations. On a more local note, the SPIFFY members explained their confidence in GMH, based in part on the efficiency with which the company has undertaken its mammoth student housing development. They also surveyed students to gauge the likelihood that students would seek to live there once the apartments are built.
Reynolds and Sulinski say that in talking with other student investors, they realized that SPIFFY has more authority, autonomy and cash when it comes to investing university money in the stock market.
“We met a few groups that were set up similar to us, but with the other groups, there was a lot more advisor involvement,” Reynolds says.
“A lot of them have $30,000, $60,000 or $100,000,” Sulinski adds. “When we say $1 million, people say ‘Wow!'”
Strong, who attends the SPIFFY meetings as much an observer as advisor, says many student investment clubs around the nation are designed as special classes with a half dozen or more faculty advisors overseeing the trading decisions. SPIFFY is an extracurricular club open to any undergraduate student on campus.
Though available to assist if asked, Strong says, “I don’t pass judgment on what they decide and they don’t have to get approval from me. I’ve purchased many a security myself that they’ve recommended. It’s interesting that they take it upon themselves to do the research. It almost becomes a hobby.”
Most of the students in SPIFFY have taken Strong’s classes in derivatives and investments, and have read Strong’s popular textbook “Derivatives: An Introduction.”
Reynolds and Sulinski credit Strong for the success of SPIFFY’s performance at the hands of students.
“I don’t think there are a lot of universities that have an expert like that on staff,” Sulinski says. “We really have some heavyweights in the finance department.”