Friday, December 9, 2011

Marquette AIM Program December 2011 Newsletter

Applied Investment Management Program at Marquette University
A Very Productive Fall Semester for AIM Students Comes to an End
The past three months have moved quickly for the students in the AIM program. With 10 sets of AIM equity presentations (see the complete listing of the 49 stocks pitched this semester by the AIM seniors) – 8 of which were delivered in off-campus locations (see table of this semester’s presentations) – the AIM program was truly on the go. Additionally, many investment professionals spoke to the AIM students in the classroom and visited campus during the fall semester (see the attached list of speakers and guests).

Dr. David Krause, AIM program director said, “Taking the students on theroad to present their equity research findings was again a success. The students have an opportunity to visit investment professionals in the respective company’s headquarters. This allows us to meet more investment analysts and portfolio managers – gaining access to many of the most successful investment professionals in the Midwest. We look forward to as many as 10 AIM presentations, both on and off campus again in the spring semester.”
 
Krause continued, “We are thankful for the opportunities the investmentcompanies have provided us to visit their firms and to pitch stocks. This is an invaluable experience for our students. Also, special thanks go out to those professionals who have ventured to our campus during the day. We know that finding parking and navigating the campus during the day is no simple feat. We truly appreciate the investment professionals who come to campus to meet with our students.”
 


 
Guest and Visitors to AIM Program
The First Madison-Area Marquette AIM Program 'Road Show' Was a Success
Four AIM students, Dr. David Krause, and Charles Ries of Marquette University made the drive to American Family Insurance in Madison to present their most recent set of stock recommendations on December 2nd. This was the first AIM program ‘road show’ held in Madison.
Dr. Krause, AIM program director said, “The visit to American Family is precisely why we take our students on the road to pitch stocks. We had an opportunity to meet and interact with eight investment professionals in their work setting, plus we were able to present before a group of aspiring middle and high school students in Madison interested in finance. I don’t think that the day could have gone any better. It was a resounding success.”
 
Dr. Krause continued, “We’d especially like to thank Richard White andPeter Gunder of American Family for allowing the AIM students and the Madison "Millionaires Club" to visit their impressive facility. Without a doubt we want to return each year with the newest class of AIM students. The professionals at American Family were exactly what we want from our audience during a road show. They asked direct and insightful questions – plus they were able to help with useful pointers about how the students could improve their analysis. It was a great learning environment.”
 
To access the December 2nd presentations delivered to the professionals at American Family Insurance in Madison, follow the link for the current equity write-ups: AIM Student Equity Write-up American Family  (pdf). If you want to access all of the past student stock write-ups since the inception of the AIM program in 2005, follow this url: AIM Student Write-ups.
 
The AIM students presented the following stocks at American Family:
  • Patrick Keeley - Cloud Peak Energy, Inc. (CLD)
  • Kaili Wang - Autodesk, Inc. (ADSK)
  • Harrison Davis - Vanguard Health Systems (VHS)
  • Jonathan Schwerin - Johnson Outdoors Inc. (JOUT)
This was the last AIM road show of the fall semester. The American Family presentation was the 8th off-campus location and the 10th set of presentations during the semester. Krause said, "We’ll be back next semester with six planned road shows and three sets of presentations at Marquette in the AIM Research Room. The new AIM students in the Class of 2013 will make their first public presentations in March and April 2012. The full spring 2012 presentation schedule will be published soon and will likely include road shows to Geneva Capital Management, 1492 Capital Management, R.W. Baird, and other Milwaukee area investment firms. Additionally, a Chicago road trip is in the works for early March 2012 which will include visits to some prominent financial firms."
 
As mentioned above, “The Millionaires Club” also attended the AIM presentations at American Family on Friday, December 2. The Millionaires Club is an after-school and evening program for high-school and middle-school members that introduces students to financial ideas and trains them in the practical money management skills of setting financial goals, budgeting, saving and investing. Asset Builders of America sponsors this very important program. In addition to this substantive education, the Millionaires Club also increases its members’ human capital by teaching self-respect, assertiveness, excellence, and professionalism.
 
Asset Builders of America’s mission is to promote financial education and wealth-building strategies to enhance the quality of life of low-income youth, families, and communities. To accomplish this they have created various programs including the Millionaires Club.
 
Dr. Krause said, “It was great that Bob Wynn brought the students in the Millionaires Club to American Family for the AIM presentations. The kids asked great questions and we thoroughly enjoyed meeting and talking with them about investing. Thanks to Bob Wynn for organizing the Millionaires Club visit and for American Family warmly greeting and hosting all of us.”
 
The students in the Millionaires Club who attended the event were:
  • James Blilie - 8th Grade
  • T'Lovius Comer - 8th Grade
  • Lauren Tatus - 9th Grade
  • Joaquin Lara - 9th Grade
AIM Funds Overview

 
Marquette’s AIM students engage in stock and fixed income fund selection and the management of three real portfolios, thus gaining hands-on money management experience.  They learn to deal with the uncertainty inherent in the process of estimating investment value and contrasting it to the observed market prices.  The process helps students to develop their intuition and their animal spirits as applied to investment decisions.
 
According to Dr. David Krause, AIM program director, “The students aregaining valuable lessons about the challenges of forecasting global economic trends and asset value. The past year has been incredible swings in stock prices and bond yields – mainly driven by political actions (or inactions). Obviously, predicting what the U.S. Congress or ECB is going to do with any degree of consistency has been difficult. Nevertheless, the AIM students have done a fine job weathering the storms of the past year and learning about managing money during turbulent times.”
 
The performance of the three AIM Funds (small cap domestic equity, international equity, and fixed income) is displayed in the table below. Krause added, “The AIM Equity Fund has had a strong year with returns more than 500 bps above the benchmark. On the other hand, the AIMInternational Fund has been an underperformer primarily because of the overweighting on emerging market firms. The AIM Fixed Income Fund has been short duration and long corporate credits – which did not fare well during the U.S. rating downgrade and European sovereign debt crisis. I believe the students have a good long-term strategy and have tactically tilted the portfolios toward a moderate U.S. economic recovery in 2012.”
 
Krause concluded, “The objective of the AIM Funds has been to assist students in gaining a conceptual and practical knowledge of the investment profession. I believe that the Marquette student-managed funds have been successful in meeting this goal.”
 

The AIM/FMA ‘Open House’ for Interested Freshmen and Sophomores Was Well Attended
Dr. David Krause, AIM program director said, “The November 28th AIM/FMA open house was very successful. The event was held in the AIM Room and attracted over 35 freshmen and sophomores interested in studying finance at Marquette. Additionally, there were 5 finance faculty and staff; 15 AIM juniors and seniors; and 8 AIM alumni who attended the open house. I was very pleased with the turnout given that we had to contend with the Thanksgiving break and a Marquette basketball game. We learned a lot from our first freshmen/sophomore open house and we intend to schedule at least one each semester going forward.”
 
The AIM / FMA 'open house' provided freshmen and sophomores interested in studying finance at Marquette University the opportunity to gather information about various opportunities within the finance major - including the AIM program and student clubs (Financial Management Association and Investment Club).
 
Dr. Krause said, “I was pleased that students had the opportunity to talk with other finance faculty, recent graduates and current upperclassmen (including seniors and juniors in the AIM program). We will have will have several opportunities for the students to hear from guest speakers in January and February when we return to campus.”

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