Theory of Connectivity - Muhlenberg Investment Society
The Muhlenberg Investment Society is a student-led group that manages real funds on behalf of Muhlenberg College. Thanks to a gift from an alumnus and non-endowment funds allocated by the Muhlenberg College Board of Trustees, the organization enables students to use market research and analysis to administer a portfolio valued at approximately $250,000. The group's long-term goal is to outperform the gains realized by Muhlenberg's endowment funds.
“The last presentation to the Board showed an 11% annualized gain since 2008,” says Jason Monroe '14, a finance and economics double major and a captain of Muhlenberg's lacrosse team. “We’re proud of that, especially considering the downward trends precipitated by the global financial crisis.”
While the group has a large percentage of finance-related majors, membership in the Investment Society is open to any student who has completed Introduction to Portfolio Management. The course helps students learn how to manage a portfolio while promoting an understanding of financial assets and markets.
“We do manage real money, and that’s kind of cool,” says Casey Gill '14, also a finance and economics double major and Muhlenberg lacrosse captain. “The practical experience is very important in the long-term, and I think that’s what draws our members in. We’re not just doing this with hypothetical funds; anyone can do that. But having and managing real money really gives us credit.”
Edwin Baldrige III, lecturer in accounting, business, economics and finance, serves as the group’s advisor. He listens to their recommendations and reports, and he handles the actual transactions when the portfolio evolves.
“The Muhlenberg Investment Society teaches a life skill,” says Baldrige. “Most approaches to portfolio management focus on stock picking; that can be a spinning wheels approach - a couple hits, a couple misses, but there’s no real consistency. What we’ve done here is asset allocation. Students have a balanced portfolio that’s broadly diversified. They can take what they learn and apply it directly to their own investing.”
The society had enjoyed a presence on Muhlenberg's campus for well over a decade before undergoing a renovation in 2010 when Baldrige recognized a need for student involvement beyond the classroom and between semesters. Now, instead of working with a live portfolio for only a single semester, students can continue working with the society throughout the entirety of their Muhlenberg career.
“Students learn how to invest on their own - to realize that the concepts of risk and reward are related,” says Baldrige. “They learn the economic fundamentals that go into investing. Some of the students may seek a career as an analyst; they can directly use these skills. Others might go on to medical school, but they still want to learn how to manage a personal portfolio.”
Alumni and members of the Board of Trustees frequently serve as career mentors for Muhlenberg students before and after graduation. Casey and Jason value the experience the Investment Society has given them, and they look forward to staying in touch with members of the society after commencement. They have already accepted positions within the financial industry - Casey in New York and Jason in Boston.
Pictured: Casey Gill (left) and Jason Monroe (right). Photo by Mike Falk, director of sports information.
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