From stock selection to multi-asset investment management

Abstract

Purpose The purpose of this paper is to trace the evolution of the Archway Investment Fund (AIF) at Bryant University from its founding in 2005 as a portfolio focused exclusively on US equities to a multi-asset program that incorporates US equities, non-US equities, equity ETFs, REITs, individual bonds, fixed income ETFs and options. It also describes the explicit introduction of environmental, social and governance (ESG) considerations into the investment process. Design/methodology/approach The paper follows a case study approach. Findings The paper describes the programmatic changes that accompanied this evolution in these areas: finance department curriculum innovations; the investment guidelines and constraints that govern the AIF; the investment process utilized; the oversight and governance process; and the reporting, presentation, and publicity initiatives that keep critical constituencies (university administration, faculty, alumni and students) informed and engaged in this program to sustain its success. Originality/value The vast majority of student-managed funds are equity funds focused on individual stock selection. The AIF is a multi-asset fund with separate equity and fixed income sub-portfolios that explicitly incorporates ESG factors into the security selection process.

Student-managed investment funds: a review and research agenda

“…D'Souza and Johnson (2019) note that the capital base of the SMIF at Loyola University Maryland was carved out of the university's endowment funds, and Horstmeyer (2019) describes a similar SMIF funding scenario at George Mason University. Yerkes (2017) suggests that the "source of funds is likely to determine the organizational structure of the fund" (p. 44), and a wealth of case studies detail the structure and organization of funds at various universities, for example, the University of Wisconsin-La Crosse's Spellman Portfolio (Krueger, 2011), Saint Louis University's Applied Portfolio Management (Betker and Doellman, 2019), and Bryant University's Archway Investment Fund (Ascioglu and Maloney, 2019). These, and similar case studies, describe the source of funding, Studentmanaged investment funds: a review investment policy (see Stream 2 of this review for more on SMIF investment policies), ties to the university and the roles of students and faculty.…”

“…Other common structures are cocurricular organizations, as with Memorial University's The Fund (Oldford, 2019) or as an organization independent of the university, as with University of Puget Sound's Four Horsemen Investments (Livingston and Glassman, 2009;Livingston, 2019). Many case studies, including Bowers and Lavin (2012), Howe et al (2019) and Ascioglu and Maloney (2019), discuss how the SMIF is integrated with curriculum with each university taking a slightly different approach. Going into more detail is Kahl's (1997) account of The Oak Grant at the University of Akron, where students enrol in a SMIF course, and here, the author provides specifics on course design and learning outcomes.…”

“…Further, ESG inclusion may also be useful for risk mitigation (G€ orgen et al, 2019). Ascioglu et al (2017) provide insight on its own inclusion of an ESG framework for its SMIF program, and Ascioglu and Maloney (2019) expand on this insight by describing the management of the stock selection process and the ESG integration along with its other asset consideration. In addition, Brune and Files (2019) discuss ESG integration into their portfolio as a method of positive screening for biblical values.…”

Can student managed investment funds (SMIFs) narrow the environmental, social and governance (ESG) skills gap?

“…Existing research that discusses ESG within SMIF analysis and decision-making is small but growing. Clinebell (2013), Ascioglu et al (2017), Ascioglu and Maloney (2019), Saunders (2015), Ghosh et al (2019), and Brune and Files (2019) each discuss how ESG integration into a SMIF has permitted students to achieve risk-adjusted returns, to mitigate risk and to adhere to an ethical consideration within their organizations. Further, Saunders (2015) engages students in the process of attending shareholder meetings and getting students to practice shareholder advocacy and engagement through socially responsible investing (SRI).…”