Issue date: 11/10/08 Section: Money/Health

Members of the Student Investment Management Program pose for a group shot. (First row, left to right) Matt Maki, Lindsay Frederickson, Joe Craven, and Ben Cain.

As America's economy began to decline over the past year, it took some people by surprise. On the other hand some saw it coming, including the group of students who make up the Student Investment Management Program along with SIMP director Ray Hughes. While some responded unfavorably to the declining economy, SIMP looked at it as a valuable learning tool to be used when those in the program become professionals in their fields.

SIMP is a program open to junior and senior business students. The students in the program actively manage the Clearwater Fund, a portfolio of equities and fixed income securities established by the

UW-Eau Claire Foundation in 2002 with a grant of $200,000 and deriving its name from Eau Claire meaning "Clear Water" in French, Hughes said.

The program was created with many goals in mind. First was to help improve the presentation skills and research skills of the members, Hughes said. The students research stocks or securities, listen in on analyst calls with companies, research companies' financial statements and look at publications and news releases. Also members spend a significant amount of time preparing to look at sector industries, developing a business plan for how they will manage the $200,000 from the UW-Eau Claire Foundation, and developing an asset allocation strategy to achieve what their purpose is for managing this money, Hughes said.

"They learn how to look at portfolio management practices," Hughes said. "They get to develop their own strategies … We don't do it for them, we ask them the tough questions and they develop it."

Historically the program has been set up with two different levels of analysts. Junior analysts come in and learn about sectors and industries, companies, what to look for in management and they help the seniors do the ratio analyses, Hughes said.

He added they get to sit in when seniors make a presentation to a company that the juniors helped them prepare so there isn't the same type of demand on them to earn their one credit from the independent study.

Then as seniors they become the second level of analyst and go through a three-week summer class, where they start from scratch on how to research and value a stock. They then develop a business plan to manage the Clearwater Fund and once they have the business plan done they present that to the UW-Eau Claire Foundation advisory board.

Continued...

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