Student Managed Investment Fund

Bucknell University College of Management

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Portfolio Value climbs above $950,000!

At market close today, the Student Managed Investment Fund’s portfolio was worth $951,329.41.

 

The portfolio consists of various equities and exchange traded funds.

Equities: Apple, American Express, Blackrock, BMY, Celgene, Chevron, Diageo, General Electric, IBM, Intel, Coca-Cola, Las Vegas Sands, McDonalds, NIKE, Norfolk Southern Co., Southern Copper, Slumberger, Ventanas, Linn Energy, and Verizon

ETFs: EMB, GLD, PGJ, TIP, VTI

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Dow Jones above 13,000

[wikichart align=”right” ticker=”INDEX:DJI” showannotations=”false” livequote=”true” rollingdate=”6 months” width=”300″ height=”245″]

For the first time in nearly three years, the Dow Jones has closed above 13,000 points.  SMIF has positions in several of the equities on the Dow, including American Express, Chevron, GE, Intel, IBM, Coca-Cola, and Verizon.

To date, the SMIF portfolio stands at $936,339.63, aided in part over the last week by Las Vegas Sands, Apple, and Intel.

 

[WSJ]

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Portfolio Value Jumps $900 Thousand

Vince Mistretta presents exciting news on behalf of the Accounting Committee:

As of market close today, our portfolio is worth $902,404.77. Compare this with the portfolio’s value when we started actively managing [in August], ~$824,000, and we have around a 9.2% return.

Congratulations to everyone in SMIF. 

 

The current class of managers officially inherited the portfolio at just over $910,000 in April 2011.

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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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September 29, 2011

Today in Class:

Stock Pitch

  • UPS (Jeff Sowell): Recommended to buy 300 shares.  UPS has very strong market share versus its competitors, it is well diversified, and has a hold in international markets.  The debt is staggered over the years so it is not overwhelming to UPS’s operations.  The SMIF portfolio is currently underweight in industrials and UPS has outperformed the S&P 500 for the previous five years. UPS also offers a dividend which can hedge against volatility.  The class decided to buy 300 shares of UPS with a limit order set at $62.51.

Access the full minutes here: 09-29

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September 22, 2011

Today in Class:

Michael Sena briefed the classroom on a new technology the class could use to speed up votes, rather than using pens and paper.  Clickers are provided by the Bucknell University Library and display voting results instantly on the in-class projector.

The econ committee reported on the current US consumption, investment, governmental spending, net exports, and GDP numbers.  We expect consumption to rise by 2%; residential investment to remain stagnant and non-residential to improve modestly; government spending to contract this year and then increase at a slower rate over the next five years; net exports to increase by around 4% due to a weak American Dollar, and for GDP to grow by around 1.3% over the next year.  We are bearish overall.

Sector Updates:

  • Energy – Oil is down and energy as a whole is not forcasted to grow.
  • Financials – These should continue to remain depressed for the foreseeable future, and special attention should be payed to Europe.
  • Utilities and Consumer Staples – These will ride out the market, the class plans to overweight.
  • Materials – Investment decisions will depend on the strength of the U.S. Dollar.
  • Consumer Discretionary – As the economy grows slowly or not at all, we should expect to underweight consumer discretionary stocks.

The class discussed the possibility of a double dip recession and decided that over 2% GDP growth is necessary for sustainable job growth.  Housing should be monitored as it will most likely lead us out of the current period of depressed growth.

Buy/Hold/Sell

  • TEVA (Monica Wu): Recommendation is to hold.  The class noted that margins are down so growth will be hard, there have been no recent brand-name drug approvals, and that sales are down.  However, market data showed that out of 28 analysts, 22 said TEVA was a strong buy, so despite general consensus to sell, the class ultimately decided to hold in hopes of being able to sell TEVA at a higher price.

The PG limit order buy 100 shares at $61.16 and KO limit order buy 100 shares at $69.51 both have executed.

Access the complete minutes here: 09-22

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September 20, 2011

Today in Class:

Students were assigned to sector committees based on the S&P 500 to present within the next two weeks on the outlook for that sector and determine an appropriate sector allocation in the portfolio.  Further changes were proposed to enhance the detail taken in minutes.  The professors announced that Frank Schreiner would visit the class on October 6th.  The accounting committee presented their weekly report, drawing attention to the fact that the fund was still overweight financials and consumer staples.

Buy/Hold/Sell:

  • Monica Wu – TEVA: More issues centered on uncertainty of TEVA’s generic drug pipeline have forced one more look at this company, scheduled for next class.
  • Henry Huang – PG: Proposed to buy 350 shares at $62, but the motion failed.  The class considered whether KO was a better buy in the consumer staples sector before ultimately deciding to buy 100 more shares of PG at a $61.16 limit order.
  • Thomas Brown – EMB:  A proposal to sell due to credit and interest rate risks failed, as did one to buy due to preferable yield.  Class settled on holding due to the diversity of holdings and exposure to emerging markets.
  • Brendan Smith – TIP: hold.
  • Alec Jacobs – VTR: hold.  There was some concern over the REIT’s low return but no alternative investment was proposed at the time.
  • Jason Katz – VZ: hold, Verizon is one of the best performing telecoms on the market.
  • Erin Reddy – KO: recommended a hold but further discussion revealed a desire to accumulate because of Coke’s excellent exposure to emerging markets, which the portfolio currently lacks.  Similarly to VZ, it is a better performer than its competitor, PepsiCo.  The ultimate decision was to place a limit order for 100 more shares at $69.51

Access full meeting minutes: 09-20am and 09-20pm

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September 15, 2011

Today in Class:

New procedures for taking and approving minutes were implemented to increase value for our stakeholders.  The accounting committee presented that the beta of our portfolio was 0.61 compared to the S&P 500.

Buy/Hold/Sells

  • Andrew Van Valkenburg – JPM: hold to price target of $41, possibly into 2012.
  • Jordan Donaldson – GE: hold to price target of $18, possibly purchase more at $15.
  • Ryan Tomasello – FSTR: hold to watch litigation.
  • Mark Ayoub – GIS: motion to purchase 200 additional shares.
  • Monica Wu – TEVA: hold due to uncertainty about company operations.

Download full class minutes: 09-15