It may sound like the concept for the next reality TV hit: give twenty-five undergrads nearly $1 million and turn them loose. But this is no TV show; this is a typical day in one Marriott School classroom.
In BusM 415, an investment analysis and portfolio management class, the school’s premier undergraduate students manage a portfolio of three-quarters of a million dollars. “The class is run like a real-life investment company, except it has no salaries or marketing,” quips professor Bryan Sudweeks, associate professor of finance. “It’s completely student-run, providing lots of opportunities for leadership in stock selection.”
Twenty-three students are split up into five teams, each representing a group of industry sectors. Together the teams analyze companies, select stocks, and report every month to shareholders, specifically Global Financial Advisors, an international investment firm and the class’s largest financier.
The experience is rare and paramount to learning the ins and outs of trading stock, Sudweeks says. BYU is one of only a handful of universities nationwide to let undergraduate students manage real money and real stocks—let alone nearly a million dollars. On average the class buys and sells stock in two or three companies a semester.
“Most classes are cookie cutter; this class is not,” says Jared Walker, a junior finance major from Las Vegas. “We have a goal—to outperform our benchmarks—and we are free to do whatever we need to obtain that goal. It’s a lot of pressure, but it makes you want to step up to the plate and deliver.”
The beginning of a typical day in class looks like any other as students present their research. But then the room evolves into a scene reminiscent of the New York Stock Exchange. The discussion gets heated, financial formulas are scribbled on the chalkboard, numbers and graphs dance between PowerPoint slides, and then in a culminating moment, the class goes silent. Students take out their iclickers, a handheld audience response system, and indicate their final vote—buy, hold, or sell.
According to one of the two student research leaders, Jeff Bullock, it’s this hands-on approach that fosters the greatest learning.
“We are constantly researching and presenting, trying to find companies ‘on sale,’” says Bullock, a senior accounting major from Denver. “This is a class that makes you want to finish your other homework so you can have more time to devote to the class.”
Although this portfolio management class is only five years old, it has produced some exceptional results. After graduation, many students take jobs at large investment firms or on Wall Street—this time getting paid for their work.
According to April Lindgren, a 2009 finance graduate employed at Fidelity Investments in Salt Lake City, the class is the crowning jewel of her résumé and helped her in the interview process.
“To say I have written extensive financial statements, reported to shareholders, and made valuations and investment decisions—it stands out,” Lindgren says. “Employers are often really impressed that I did all that as a college student, as an undergrad no less.”