Student Managed Investment Fund

Bucknell University College of Management

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January 24, 2012

Today in Class: We discussed the online presence of SMIF (on Twitter, Facebook, and this website), heard the accounting report, discussed filling out sectors with ETFs, and presented additional Buy/Hold/Sells.

Accounting Report, click here for full report.  Notably we were called out on AFL and EBAY and are currently holding over 55% of the portfolio in cash.

Buy/Hold/Sells

  • EMB by Tom: Hold
  • VTR by Alec: Hold
  • AAPL by Arvi: Hold
  • AXP by Vince: Hold
  • FSTR by Ryan: Hold
  • TIP by Brendan: Hold
  • BMY by Oliver: Hold
  • DEO by Stefanie: Hold
  • INTC by Jordan: Hold
  • KO by Erin: Hold
  • LVS by Erin: Hold
  • BLK by Lindsay: Hold.  The class also decided to sell (20-0-1) April $195 calls.
  • UPS by Jeff: Sell.  The class voted to sell (21-0) all shares at $74.98.  This decision was reached due to worries about Europe and Asia, influenced in part by the IMF’s recent forecast of growth cuts globally.
  • GLD by Will: Hold
  • SCCO by Will: Hold

Read full minutes here: 1-24-12AM and 1-24-12PM

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October 4, 2011

Today in Class:

The layout of the Fall 2011 Newsletter was discussed and the publish date was set for November 1, 2011.

Sector Reports

  • Healthcare (Holdings: CELG, TEVA, BMY) – BMY and CELG are both out-performing the S&P 500, yet TEVA is struggling.  Healthcare consumption has been rising every quarter in the past few years, however we see possible political risk present in several lawsuits that are challenging President Obama’s Healthcare bill.  Overall, we judge this sector to be risk averse, not volatile, and presents opportunities for high dividend yields.  The class has decided to overweight this sector.  See full sector report here.
  • Industrial (Holdings: GE, FSTR, UPS) – Industrials has been under-performing the S&P 500 but due to a 1.4% increase in construction spending in August and a full point increase in the PMI, we feel that it is best to stay neutral with the S&P 500 sector weighting.  See full sector report here.
  • Information Technology (Holdings: EBAY, IBM) – IT is a sector SMIF is very interested in, but we are wary of negative returns in the short run.  As spending is tied to global demand, we feel increasing our weighting and holdings would be ill-advised.  As such, we feel it is best to stay neutral.  See full sector report here.
  • Telecoms (Holdings: VZ) – Telecoms have high dividend yields and we will investigate diversifying our holdings, but will remain neutral with S&P sector weighting.  See full sector report here.
  • Utilities (Holdings: ED) – While the sector’s performance has been exemplary, we feel that prices are inflated and increasing in our position in utilities would result in future losses.  We will remain neutral with the S&P 500 sector weighting.  See full sector report here.

 

Read the entire class minutes: 10-04-11 Minutes

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Healthcare Update

SMIF Holdings: CELG, TEVA, BMY

BMY and CELG are both outperforming the S&P 500, yet TEVA is struggling.  Healthcare consumption has been rising every quarter in the past few years, however we see political risk present in several lawsuits that are challenging President Obama’s Healthcare bill. The supreme court decision on the three cases (Florida v. Department of Health and Human Services, No. 11-400; National Federation of Independent Business v. Sebelius, No. 11-393; Department of Health and Human Services v. Florida, No. 11-398) is expected in June 2012.  Until March, when the Supreme Court will start to hear arguments, we believe the sector is safe.

Overall, we judge this sector to be  risk averse, low volatility, and high yield.  We have identified that due to the complex capital structures of many companies in healthcare, SMIF must perform more analysis than previously thought to assess company dividend yields.

We are satisfied with BMY but plan to close out our positions in CELG and TEVA in the near future.  Ideally, we will pick up JNJ, LLY, and ABT.

The current SMIF recommendation is to overweight the S&P 500 by 100 to 150 basis points.

 

Read the full presentation here: Fall 2011 Healthcare Sector Report

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August 30, 2011

In class today:

  • Created a new email list and class contact list,
  • Went over professor Needham’s and Jensen’s expectations of the class,
  • The accounting committee reported on the current asset allocation and subsequent summer updates, and
  • Jeff, Oliver, and Aleem presented Buy/Hold/Sell’s on American Express (AXP), Bristol-Meyers-Squibb (BMY), and Celgene (CELG), respectively.

Access the full class minutes here