Student Funds

Semper Augustus Student Fund Survey

Stock Pitch Competitions

CFA Institute Resources

University Affiliation Program
Student Managed Investment Funds
Resources for Professors
CFA Institute Research Challenge

Best Practices

The mission of the fund must be to facilitate learning and hands-on application of investment management. Investment performance is a goal but not the mission.
Students take leadership roles.
The endowment or foundation should be supportive but must act as a client and hold the fund accountable for keeping process and philosophy consistent.
If management of the endowment/foundation is completely outsourced, the outside advisors should be encouraged to be involved with the faculty advisor and student leadership.
Duration of involvement ideally is over longer periods – a semester only scratches the surface. Structuring funds as an extra-curricular group allows for longer duration of involvement, lower turnover, and better incentives.
A formal, “for credit” class can be built into the fund structure for the more senior “managers” of the fund. Often this is the portfolio management group.
Students should be encouraged to join from any major in any year of their education.
More senior experienced students are responsible for the teaching and training of newer members. Recruitment of new members from earlier grades is essential to continuity.
Involvement requires commitment, not a checkbox for a resume. A repeatable application process in place keeps turnover low.
Faculty or outside advisor involvement is critical. Experience in investing and analysis a plus. A network with the alumni base important.
Broad support by school leadership and those overseeing the main endowment/foundation.
Custody and trading systems are well thought out, often integrated with the investment office or outsourced manager.
Proper benchmarking, diversification and a limited defined universe create necessary safeguards and risk management – investing in boiler room promotions would not be looked on with favor by the Board or folks running the endowment!
Adequate diversification but not so much as to not be manageable is important. Position sizing is part of the process. The mission is learning and experience.
Focus on company valuation, business quality and price. Research on potential portfolio holdings should be rigorous and face open floor debate among other members of the fund before a decision is made. Incorporate opportunity cost into the research process.
Investment horizon should be extremely long to match the horizon of the client and incentivize a long-term investment mindset.
Stress proper portfolio maintenance and research. Emphasis on portfolio maintenance should be just as strong as emphasis on buys and sells. A position should not be held complacently because, “I wasn’t on the team that bought it.”
Rigorous fundamental analysis, valuation methods, financial statement analysis and accounting.
Outside speakers and networking are a must. Involve the alumni and keep in touch with them.
Facilitate networking and employment opportunities. Participate in other stock pitches or research competitions. Get involved with the CFA Institute and the local Society.

2021 SAI Letter

Student-Run Endowment Funds (pgs. 64-72)