Friday, September 21, 2012
Thursday, September 20, 2012
Thursday, September 13, 2012
The top finance speciality undergraduate programs were:
1. University of Pennsylvania
2. New York University
3. University of California - Berkeley
5. University of Michigan - Ann Arbor
6. University of Texas - Austin
7. University of North Carolina - Chapel Hill
8. Carnegie Mellon
9. University of Virginia
10. Indiana University
11. Ohio State University
12. University of Florida
13. Boston College
13. University of Illinois
15. Creighton University
15. University of Southern California
17. MARQUETTE UNIVERSITY
17. University of Maryland
17. University of Washington
17. Emory University
17. Loyola University - Chicago
22. Fordham University
22. Loyola University - Maryland
23. Washington University
26. University of Georgia
26. University of Notre Dame
26. University of Wisconsin
Monday, August 20, 2012
Mary Ellen Stanek, president of Baird Funds in Milwaukee, has been worrying about the value of a dollar for most of her adult life. In high school and college, she spent her summers working in a community bank, where her father was president. "I did everything from the night deposits to the switchboard," says Stanek, 56.
After graduating magna cum laude from Marquette University in 1978, she flirted with going to law school. But banking was in her blood. Rather than follow her father to the commercial side, she took an entry-level investment position at First Wisconsin Trust Milwaukee, where she was handed the task of researching the real-world implications of duration, an obscure concept at the time that is now paramount to any discussion of interest-rate risk. "Up until then, people used maturity to describe a bond's risk level," says Stanek.
For those of you who don't run a bond fund: Duration is a measure of how sensitive a bond's price is to any change in interest rates. Like maturity, duration is expressed in years. But while maturity is the time left before a bond comes due, duration incorporates the timing of any interest and principal payments prior to maturity.
Most people find it hard to gin up any interest in duration, let alone cultivate a passion for it, but it was at Stanek's first job that she found like-minded colleagues and began a 30-year partnership with Gary Elfe and Charlie Groeschell. "We've grown up together in the business world," says Stanek. In 2000 the trio left their longtime employer—which, after a name change and an acquisition, is now a division of U.S. Bancorp—and headed over to R.W. Baird, located in the same building.
Today Stanek is president of Baird Funds and, along with Elfe and Groeschell, oversees a 28-person fixed-income team and $16.7 billion in separate accounts and five bond mutual funds, notably the $1.9 billion Baird Core Plus Bond
|Mary Ellen Stanek|
That strategy isn't uncommon at smaller firms that don't make big macro bets. It can, however, mean that managers have less leeway to quickly adapt to rising interest rates, since they're not in the business of forecasting them. That's why tossing out duration decisions "removes one of the major levers for adding returns, particularly in a volatile environment," says Rick Beard, managing director of Cardinal Investment Advisors, who recommends Baird's fixed-income strategy to his institutional clients. Beard concedes, though, that "it's really hard to out-predict the market."
Moreover, "when you're trying to make interest-rate calls, you have to take your eyes off the other balls," Stanek says, adding she'd rather add value by focusing on yield-curve position, sector allocation, and security selection.
Fees are also a focus: Transaction fees, "the enemies of clients' wealth," says Stanek, are kept to a minimum. And at 0.55% (0.30% for institutional shares), the fund's expense ratio is nearly half that of its peers.
The team builds the framework of the portfolio based on where they want to be on the yield curve—currently the fund is over-weighted in seven- to 10-year bonds and underweight shorter-term government securities—and what sectors offer the best risk-reward. After that, the bulk of the work goes into individual security selection.
The fund often deviates from its benchmark, sometimes substantially. Today, for instance, financials represent 22% of the portfolio, but just 9% of the benchmark on a duration-weighted basis, which reflects the actual price sensitivity of the sector to interest-rate changes. While a black cloud still hangs over the sector—yields are about 225 basis points higher than comparable Treasuries—Stanek and her team have a different take: Not only are banks driven to keep their credit ratings high, she says, more-stringent regulations bode well for bondholders. "We wouldn't want to be shareholders in many of those companies," she says. "But we feel our bond positions have only been enhanced." They view bad news about financials as buying opportunities.
Clearly, the fund will take sector bets, but Stanek is careful to diversify its credit risk. Of the fund's 585 securities, its largest credit holding, General Electric
Stanek's focus on individual securities and the details of their often complicated structures help her win what she calls "a game of inches."
Baird Core Plus Fund (BCOSX)
Barclays U.S. Universal TR
U.S. Govt Agency
Other Govt Related
Mgt Backed Securities
Com Mortgage Backed
All returns are as of Aug. 16, 2012
Core Plus is the most aggressive expression of Baird's very conservative fixed-income strategy. Though the fund isn't limited to cash markets—in other words, the buying and selling of actual bonds—it tends to stay away from those other options, such as derivatives, convertibles, non-dollar denominated securities, and anything else that many bond-fund managers use to goose returns.
"Some advisors have told us we're core plus 'lite,'" she says. But Stanek prefers to describe it as a "what you see is what you get" style of management that's focused on besting the index, but not at the expense of predictable returns. "Isn't that why people invest in bonds in the first place?"
Tuesday, August 14, 2012
Monday, June 25, 2012
|The Wholey & Poitras Group|
The U.S. Supreme Court will rule this week on the constitutionality of the Patient Protection and Affordable Care Act ("Obamacare") and it is likely to impact the stock market as much as the European debt crisis. There will be likely winners and losers depending upon the outcome (which could be upholding the act, complete striking down of the act or elimination of the individual mandate and while retaining other pieces of the act, such as guaranteed coverage).
Here are some of the likely winners if Obamacare is upheld: commercial insurers like Aetna (ticker: AET) and Medicaid providers like Centene (ticker: CNC) since it would channel new, funded patients into traditional insurers – with an estimated 20 million Medicaid recipients. Jim Cramer of CNBC suggests that if SCOTUS upholds the law, health care plan providers like UnitedHealth Group (ticker: UNH) and WellPoint (ticker: WLP) or pharmacy benefit managers like Express Scripts (ticker: ESRX) are positioned to make greater profits off the law.
Additionally, large cap drug companies like Merck (ticker: MRK), Bristol-Myers Squibb (ticker: BMY), and Pfizer (ticker: PFE) are well positioned. Finally, some hospital operators like HCA Holdings (ticker: HCA) would do well because of the lowering of uncompensated hospital care.
The hospital and provider sector would probably lose market value if SCOTUS found all or part of the act to be unconstitutional. Firms with the heaviest Medicaid mix would be hurt the most if the entire act or just the law that mandates new individuals into the system is rejected – such as Amerigroup (ticker: AGP), and Molina Healthcare (ticker: MOH).
The worst case scenario for the hospitals and other Medicaid providers is if the Supreme Court eliminates the individual mandate but maintains the remainder of Obamacare. They would be left with the reimbursement cuts, but not the promised entry of new funded customers – meaning the impoverished patients would return to the emergency room and adding to the already high level of bad debts. This includes firms like Tenet Healthcare (ticker: THC), Health Management Associates (ticker: HMA), Community Health Systems (ticker: CYH), and Vanguard Health Systems (ticker: VHS).
If the act is overturned, Cramer says that the shares of firms like Paychex (ticker: PAYX), a provider of payroll, human resources and benefits outsourcing solutions for small to medium-sized businesses, should do well. The other equity segments that could be potential beneficiaries of a decision against Obamacare are medical device makers. The act calls for an excise tax of 2.3% on total medical device revenue by 2013 – which is designed to pay for expanded Medicaid coverage under the law. Among the firms that could to well if the act is removed are Intuitive Surgical (ticker: ISRG), Medtronic (ticker: MDT), and Boston Scientific (ticker: BSX).
Some believe, such as CNBC’s Cramer, that if the act is struck down, then hiring in the U.S. will increase. He likes large cap firms, such as Wal-Mart (ticker: WMT) or Home Depot (ticker: HD) to be winners in an Obamacare defeat.
In any case, the decision this week will not only impact the 2012 presidential and congressional contests, but it will change forecasts on Wall Street.
Friday, June 22, 2012
Krause Prediction: The Supreme Court will decide to uphold the 2010 Patient Protection and Affordable Care Act
- Asia Pacific − 35 partners in Australia, China, Hong Kong, Japan, Korea, New Zealand, Pakistan, the Philippines, Singapore, Taiwan, and Thailand
- Europe, Middle East, and Africa − 47 partners in Belgium, France, Germany, Greece, Ireland, Italy, Lebanon, the Netherlands, Poland, Portugal, Russia, South Africa, Spain, Switzerland, Turkey, the United Arab Emirates (UAE), and the United Kingdom
- The Americas − 58 partners in Argentina, Brazil, Canada, Chile, Costa Rica, Mexico, Peru, the United States, and Venezuela.
Wednesday, June 13, 2012
The link to the article is at: http://marquette.edu/alumni/newsletter/2010-13/June12newgrad.shtml.
Coleen was a member of the AIM Class of 2012 that graduated in May.
Friday, June 8, 2012
With the scratch of I’ll Have Another, the 2012 Belmont Stakes comes down to either Union Rags or Dullahan. Too bad because it would have been good for the sport to have IHA run for the Triple Crown. Oh well, maybe next year…
Good luck - and too bad that we don't have a shot at the Triple Crown this year.
Wednesday, May 23, 2012
Tuesday, May 22, 2012
Saturday, May 19, 2012
Long Shot (30:1) # 10 Optimizer. D. Wayne Lukas is not getting any younger and this isn't his strongest horses, but the Wisconsin connection might come through one last time. Optimizer might be better at the 1 1/2 mile Belmont track, but at 30:1 I wouldn't be surprised that Lukas' gets his 6th Preakness. WPS #10.
Value Pick (6:1) #5 Went the Day Well. This was my long shot in the Derby and finished a strong 4th - another 1/8 mile and Went the Day Well would have been a big payday. I like the trainer and the jockey...and the horse has been improving steadily. This horse should finish up in the money.
Best Horse (8:5) #7 Bodemeister. Baffert says this horse is ready and won't give up the late lead like he did in the Kentucky Derby. Baffert indicates that Bodemesiter has trained well the past two weeks and is ready to go. Like Lukas, Baffert is looking for his 6th Preakness and I think at the end of the day he'll have it.
Nice field for the Preakness and the weather looks fine. Enjoy the races ---- and graduation! Good luck.
Thursday, May 17, 2012
Thursday, May 3, 2012
So be forewarned that, like stock picking, the Derby is a tough race to handicap because of the large field and the lack of a clear favorite. Also, the weather for Saturday afternoon is somewhat uncertain with a 40% chance of thunderstorms.... nevertheless, here goes.
Value Pick: #14 Hansen (10:1). What I like most about this pick is the jockey, Ramon Dominguez. He is the 2010 and 2011 Eclipse Award winner for Outstanding Jockey and has twice led the nation in number of victories. He has two Breeders' Cup wins – including the 2011 Breeders' Cup Juvenile (aboard Hansen). While he can go the distance and likes to lead, he did fade to second in the Blue Grass. He is coming off a four week layout and should be sharp for the Derby. I also love the Secretariat bloodline via Storm Cat. The 14 post was a good draw and I see Hansen as a nice value pick at 10:1. And, yes, he'll be an easy horse to follow during the race! WPS bet on #10.
Long-shot: #13 Went the Day Well (20:1). Here's a speed horse that could surprise if the big field groups together. Went the Day Well is ridden by John Velazquez, trained by Graham Motion, and owned by Team Valor - the same combination that won last year’s Kentucky Derby with Animal Kingdom. He has a good post position and also has a distant Secretariat bloodline. He has not run against many strong horses and is coming off a six week layoff, but could be this year’s Giacomo or Mine That Bird. Might be a good horse to include in some of the exotics especially since he could go off at more than 20:1 at post time.
Best Horse: #4 Union Rags (9:2). Union Rags was an unbeaten two year old who lost the Breeders’ Cup Juvenile last fall by a nose to Hansen. This could be ‘the’ horse in 2012 – and maybe one with a good shot to win the Triple Crown. The unfortunate draw of the 4 post along with a third in the Florida Derby will likely keep the odds high enough on race day to make for a good payout. Excellent jockey, Julien Leparoux, and a winning trainer, Michael Matz, make this a very strong entry in the run for the roses. If he can survive the rodeo-like start of the Derby from an inside post position, he might be wearing the roses. Win bet on #4.
Monday, April 30, 2012
AIM Equity Presentations on Friday, May 1st
10:00 am (AIM Room)
Barclays PLC ADR
Intl Financial Services
Intl Information Technology
Robbins & Myers Inc.
Assured Guaranty Ltd.
Intl Financial Services