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George Mason UniversitySchool of Business

Student Managed Investment Fund Awarded Mason’s First MPact Designation

Written by Jennifer Anzaldi on .

investment fund

George Mason University School of Business has been awarded the first MPact designation at the university for its Student Managed Investment Fund course.

This new university program, MPact, is designed to integrate classroom study with a range of community or research settings that drive students to identify a problem, find a solution, and gain new knowledge that results in a positive impact on the world around them. MPact projects require 90 hours of activity, projects, and reports. Students who complete all requirements will have a notation on their transcript.

The School of Business’ Student Managed Investment Fund is a unique course offering at the School of Business. The class gives finance students a first-hand experience of managing an actual investment portfolio. For many finance students, the only opportunity they have to learn about investing is through books and lessons.

Taught by Derek Horstmeyer and Tiago Requeijo, both assistant professors of finance, the course challenges the students through its hands-on learning. At the start of the semester, students break off into teams of two and choose a sector to analyze (technology, industrial, health care, etc.). Students are required to conduct extensive research on their portfolio. By the end of the semester, each team then produces a 15-30 page report on their sector, offering their recommendations for the fund. As of the fund’s 2018 annual report the portfolio had a market value of more than $225,000, with investments in 25 securities allocated across six sectors.

“In their final paper students argue why we need to change our holdings and in what manner, while minimizing transaction costs,” says Horstmeyer. “This procedure mimics exactly how a portfolio manager who invests based on fundamental analysis would make their decisions.”

In addition to Horstmeyer and Requeijo, who serve as supervisors for the fund, the fund is also managed and overseen by five of Mason’s top finance students. The Investment Committee includes Khalid Al-Masri and Ali Kahil. The Risk Committee includes Justin Boileau, Myriam Cisse, and Eleri Burnett. This committee of students must provide approval before any trades can be made. Through this process, students learn about active asset management, management of market behavior, tools to mitigate risk, and how to create equity pitches.

Horstmeyer says donations made directly to the fund provide the capital for the investments, so students can make financial moves with real money. Last semester 14 of the top finance undergrad students participated in the program, and the hope is to bring this opportunity to MBA students in the future.

“This is the only class at the School of Business that offers this hands-on opportunity in real-time,” says Horstmeyer. “Giving students this hands-on approach to market research, equity valuation, and risk analysis is invaluable.”