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Student investors outperform the market

Nov. 4, 2004

By Jessica Stark

Ohio University business students are giving professionals a run for their money, with their results exceeding the industry standard for investments.

Photos by Rick FaticaFor the 2004 fiscal year, Ohio University Student Portfolio Management Group outperformed its benchmark and earned an over 36.5 percent return on investment, about three times as much as the composite professional return on long-term investments.

Group members say SPMG has made their college experience special and will continue to do so throughout their professional lives.

"Everything we learn here correlates into our future careers. We learn the importance of working with others and respecting our coworkers. This experience develops life skills as much as finance skills," SPMG board member Tyson Vines says.

The Ohio University Foundation provided SPMG with $200,000 for "seed capital" and is considering giving the students more to invest because of their remarkable performance. The money the student investors earn is combined with other earnings in an investment pool that helps to fund scholarships, chairs and professorships, programs, building renovations and other University initiatives.

The autonomy the students have makes SPMG a unique learning experience for the participants.

"There are others who do something similar to this but the structure that we have is completely our own," says SPMG advisor Natalie Chieffe. "The students have developed it; I guided them, but it is theirs."

Photos by Rick FaticaThe group consists of about 30 members with five members who act as the board. SPMG members donate their time to research companies and choose securities and common stock that they think will do well. The students put a lot of time and effort into it, and unlike other universities' investment groups, they are not compensated with credit or money.

"This is time that the students donate; they do not get credit for this, they do not get paid for this. They do this because they love it," says Chieffe. "If you talk to any one of them, they will just express to you that they're having a good time."

The Ohio University Foundation Board of Trustees approved funding for SPMG in November 2001, based on a proposal by two students and with the support of Chieffe. SPMG made its first investment in March 2002. Since then, it has taken off. SPMG has its own office in the HDL Center with a Bloomberg Terminal and other programs for stock analysis.

Jessica Stark is a student writer for University Communications and Marketing.

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