Published April 30, 2013Learn more about the competitionLearn more about the Applied Portfolio Management class
Three students of the Washburn University School of Business were recognized this week for their success in the inaugural All-America Student Analyst Competition, sponsored by Institutional Investor.
"It shows that, as is the case in so many disciplines, Washburn can complete on a truly national level," said Rob Weigand, Brenneman Professor of Business Strategy in the Washburn School of Business. The Washburn undergraduates competed against undergraduate and graduate students from noted business schools at Fordham University, Cornell University and the University of Texas at Austin among others. Washburn was the only school in Kansas involved in the competition.
Adrian de la Cruz, a senior in finance expected to graduate in August, is from Topeka. He placed 14th of 20 in the Technology, Media and Telecommunications sector with an investment return of 8.67 percent. The performance of his complete portfolio ranked 109 among all competitors. According to Institutional Investor, the Technology, Media and Telecommunication sector was the most popular among participants. The most popular stocks in that category – and the top four most selected overall – were Apple, Google, Facebook and Microsoft.
Pascal Laucht, a senior in finance expected to graduate next year, is from Marburg, Germany. He was the only Washburn student to be named to the competition's Top 100 students list. His entire portfolio earned a rank of 84th among all competitors.
Xavier Lewis, a graduating senior in finance, is from Westminster, Colo. Lewis earned 5th place in the "short alpha" competition, meaning he sold some of his hypothetical stock based on the expectation the stock's price was about to fall. Institutional Investor said fewer than 30 percent of the nearly 700 students involved in the contest employed this strategy.
"He was like the gunslinger," Weigand said.
Lewis also placed 8th in the "long alpha" category, meaning he let some of his stock choices ride out the entire contest, from Nov. 1, 2012 to Jan. 31, 2013. Alpha is an industry term used to signify a performance better than the market, Weigand said.
Each participant in the competition had $100,000 in simulated cash to invest as he or she saw fit. Each was required to follow the rules of the Federal Reserve Board throughout the simulation.
Weigand, who has been published in Institutional Investor's journals, was asked in the fall whether Washburn students would like to participate in the contest. Just 34 of the nation's accredited business school were asked to participate. Weigand opened the contest to all business students and held a session in the Mayo Schmidt business lab to offer some tips and complete registration. Then, he said: "It was up to them."
Two of the students, Laucht and de la Cruz, completed the applied portfolio management course this semester. In that course, a capstone for finance majors, Weigand and his students manage an actual $100,000 portfolio for the Washburn University Foundation.
"We are extremely risk conscious" in the course, Weigand said. "In a contest like this, the best way to win is to take a lot of risk."
The contest gave students the feel of being on a trading desk.
"Obviously, they can do it pretty well," Weigand said. "The best way to make money is to take risk wisely."