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Poole Business
Winter 2019 From the Classroom to the Trading Floor

From the Classroom to the Trading Floor

The Investors’ Association at NC State started out with a handful of self-proclaimed “stock junkies” meeting up to talk market trends.

Now, they’ve parlayed their investment know-how into something much bigger: a student-run portfolio management group that handles major funds for the university.

A Real Asset

Founded in 2014, the Investors’ Association strives to further the financial investment knowledge of undergraduate students at NC State. Members — who have backgrounds in everything from economics to engineering — meet weekly in Nelson Hall to engage in peer-to-peer learning about the stock market and investing.

“We now have about 200 to 300 students on our mailing list,” said John Saavedra, a junior majoring in economics and international studies, and president of the Investors’ Association.

I would like to see a future where investment and financial literacy can reach a wider demographic of our undergraduate students here at NC State.

The group also partners with other student organizations across campus — including Women in Business and the Association of Latino Professionals for America — to spread investment insights and discuss topics surrounding diversity and business success.

“I would like to see a future where investment and financial literacy can reach a wider demographic of our undergraduate students here at NC State,” Saavedra said.

For him, college felt like the perfect time to start building up investment expertise.

“My parents had always talked about stocks and I thought, ‘I want to learn more.’ So when I found the club, I was instantly involved,” he said. “The earlier you start, the more you benefit.”

Raising the Stakes

While the Investors’ Association served as a great way to master basic investment principles, several of the group’s members were eager to take things to the next level.

“Some of the founders of the Investors Association came to me and said that they would like to manage some money,” said Richard Warr, interim associate dean for faculty and academic affairs and professor of finance at Poole College.

They developed a whole management structure, a whole process… modeled on real investment companies.

“I told them, ‘Before we can let anybody run any money, what we really need is that they demonstrate a proof of concept.’”

The students heeded Warr’s advice and began work on a new undergraduate-run investment management team: Bell Tower Capital Management. For more than a year and a half, they focused on setting their investment ground rules.

“They went away and built a fake portfolio in a spreadsheet using online services,” said Warr. “They developed a whole management structure, a whole process — bylaws, rules and methods for picking stocks modeled on real investment companies. They ran that for about a year just with fake money and did a great job.”

Women in Business and the Student Investor’s Association joined forces in a shared workshop on workplace relations.

More Than Monopoly Money

A track record of solid investment research and strategy — all “on-paper” exercises — led to approval last summer for Bell Tower to manage about half of the $300,000 SunTrust Wolfpack Focus Fund portfolio at NC State, with Warr as their faculty advisor.

That fund had been managed by Jenkins MBA students in the MBA 524 Equity Valuation course since 2004; students in that course will continue to manage the other half of the fund.

Bell Tower members Saavedra, Brantley and Sabo browse financial data on the Bloomberg Terminal.

“Now they really have to apply what they’ve learned in the classroom to these much more messy, kind of undefined problems,” Warr said.

This transition fostered a stronger sense of duty, according to Austin Brantley, executive vice president of the organization and a Poole College junior in business administration, with concentrations in finance and accounting.

“It teaches you to build respect and responsibility for what you’re doing, and it holds you accountable because you’re managing a real money portfolio,” he said. “It’s really important that we’re investing that money responsibly, both in terms of what we’re investing in and how we’re investing it.”

Late every Monday evening, a room in Nelson Hall serves as a makeshift trading floor as Bell Tower’s members discuss the market and analyze their portfolio. Associates come prepared with short papers and stock pitches, making recommendations on what to buy and sell.

It holds you accountable because you’re managing a real money portfolio.

“Everybody does their own due diligence,” said Matthew Sabo, a senior in the College of Engineering and co-founder of Bell Tower Capital Management. “It’s just our analysts in that sector that are picking what they think is good for the group to look at, and then presenting it to them.”

“It’s not work, where you’re doing this stuff because you have to. It’s fun,” he added. “You’re doing it because you want to learn how to do it, and because you enjoy doing it.”

Inside the Bloomberg Lab

Once Bell Tower’s members were managing money like professionals, Warr pushed for greater access to a tool on which the professionals rely: the Bloomberg Terminal.

“The Bloomberg Terminal — ‘Bloomberg’ — is the industry standard in the financial sector for real-time data and information on all financial markets,” Warr said.

It includes news, price quotes and messaging across its proprietary network, with a unique keyboard layout designed for traders. Its function keys call up market sectors such as government securities, preferred shares and commodity markets.

Thanks to the university’s new Bloomberg Lab — established by the NC State University Libraries in partnership with Poole College of Management and the Financial Mathematics Program in the College of Sciences — users can get acquainted with the Bloomberg Professional service on campus.

“The lab opens a new door to the world of real time financial data, and it gives students a platform to develop and validate new quantitative models with the data,” said Tao Pang, director, Master of Financial Mathematics and associate professor in the Department of Mathematics.

You’ll find the lab in a glass enclosed space on the ninth floor of D.H. Hill Library, housing nine dual-monitor terminals.

Being able to use Bloomberg is a differentiator for our students seeking careers in the finance industry.

“Not only is this data incredibly useful for our students and courses, but being able to use Bloomberg is a differentiator for our students seeking careers in the finance industry,” Warr said.

It’s also empowered members of Bell Tower Capital Management to monitor and analyze data more effectively.

“The terminals really help my team to be consistent. If we’re all pulling from the same database that we know is verified and accurate, it really makes our level of work higher caliber,” said Brantley.

“It’s allowed us to learn endless amounts because it’s all right here in front of us. It gets people talking. It gets people excited.”

A High-Yield Investment

Whether they’re cultivating a network of future finance experts in the Investors’ Association or gaining real-world investment experience with Bell Tower Capital Management, students are already seeing great returns on their investments.

Sean Doggett, a Poole College sophomore and member of the Investors’ Association, used the Bloomberg Lab to earn an official certification through the Bloomberg Market Concepts course.

Chancellor Randy Woodson stopped by at the Bloomberg Lab as part of his annual visit to Poole College last fall.

“I’m working on this now, so I can have it on my resume as I begin applying for internships,” Doggett said. “The Bloomberg Terminals are used in finance very heavily, and they’re a great tool to be comfortable with as you head into a future interview. It shows employers that you’re trained and ready to be on the job if you’re familiar with these terminals.”

Brantley has also seen the benefits, citing Bell Tower Capital Management as a major selling point in his internship interviews.

“The company I worked for last summer, they still email me, ‘Where’s your quarter report?’ They want to read it just to keep up with it,” he said. “And especially when you’re talking to NC State alumni, they’re amazed at how far this has gotten and grown in such a short period of time.”

“If employers only look at your resume for an average of eight seconds, what are they going to read that catches their eye? And Bell Tower Capital Management is definitely something that slows them down and causes them to read a few more sentences.”

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