In 1997, Friends of Finance established the Student Investment Fund (SIF), TU’s student-managed investment portfolio. The organization raised over $300,000 to fund the SIF’s first round of investments and over the years has contributed more than $2.3 million in gifts. Through the hard work of finance majors tasked with managing and growing the fund each semester, today the fund’s assets stand at more than $4.5 million and its earnings have provided more than $928,000 in scholarships to more than 200 students.
The SIF gives students the opportunity to gain firsthand experience in managing investment portfolios through a semester-long course led by Professor Tally Ferguson, senior vice president of risk management at BOK. Students must apply to join the fund each semester, with 15 to 20 new members selected by the current class membership.
The SIF officers lead the fund and carry out their duties following governance documents approved by the SIF board. Like any other wealth management firm, the SIF operates under the guidance of an executive committee. Jason Sauer, a senior finance student, presided over the group as student executive officer (SEO) in the spring of 2016.
Students taking the SIF course are usually either senior undergraduate students or graduate students, well grounded in accounting, economics, statistics and corporate finance and investments. Ferguson uses the first few classes to refresh students on investing fundamentals, and the SEO then leads the remaining class discussions to apply those fundamentals to real securities examples. Students also spend several hours training to operate the Bloomberg Terminal, a computer system they use to monitor and analyze real-time financial data. Throughout the semester, class members use the terminal to secure data for analyzing new investment opportunities.
Sauer participated in the spring 2015 class of the SIF and with one elective remaining in order to meet graduation requirements, he chose to enroll in the SIF once again. “Since it was my second section, I felt I could accept more responsibility and put my name in for the SEO position,” said Sauer.
Sauer was elected by his peers to fill the role and though he admits that he was initially nervous to manage a portfolio worth more than $4 million, he said, “I am in the school of thought that it takes a team to do things well at this level. The team assembled for this semester’s Student Investment Fund really did an outstanding job in their respective roles, which contributed to an overall successful class.”
Managing such a large fund requires the group to make strategic decisions within each committee and during class meetings. As an example, the recent energy industry downturn influenced the group’s move to reduce exposure in that area and increase weighting in the financial sector, which is currently more profitable.
Though a small number of other universities operate similar investment funds, few of those match the magnitude of TU’s. “Knowing that we operate the largest fund in the state, and one of the largest in the country makes us even more thankful for the opportunity and trust that TU puts in its students and faculty to manage such an investment,” said Sauer.
For students interested in participating in the fund, Sauer offers this advice: “If you want to be successful in the SIF, you have to be thorough and accurate, and manage your time well whether you are working in a group or as an individual. I believe the same applies to many areas of life, and I’m thankful I had the opportunity to reinforce these skills.”
He also encourages alumni to continue supporting the portfolio through donations that facilitate future growth as well as fund student scholarships. “Tulsa is known for preparing its graduates to succeed in the workforce, and this course is an excellent example of that. I encourage all of us to contribute to this vision for years to come.”