ST. BONAVENTURE UNIVERSITY

                                                               School of Business

Jim Mahar                                                                                                              FIN 410 – Students in Money Management

231 Murphy                                                                                                                                                                    Spring 2008

(716) 375-2359                                                                                                                                                           Office Hours: 

e-mail: Jmahar@sbu.edu (AIM FinanceProfessor)                                                                                 and by appointment

 

NOTE THIS IS ESSENTIALLY STEVE HORAN”S SYLLABUS, SO IT MAY LOOK FAMILIAR!

 

Course Description and Objectives

 

The primary purpose of Students in Money Management is to provide business students an opportunity to experience firsthand the management of a real investment portfolio.  Using money donated by alumni and others, students will be responsible for determining and monitoring overall asset allocation, for selecting individual equity and fixed income investments that conform to the investment policy statement (see attached), and for managing administrative issues.  An advisory board composed of industry professionals and alumni provide oversight and guidance.  Students enrolled for the class are responsible for reporting performance and other portfolio information to the advisory board.  This course will draw on and develop a student’s spreadsheet modeling skills and require students to develop a formal buy or sell recommendation on a stock of their choosing supported by the analyses and models covered in the course.

 

This course should synthesize many of the finance program goals located at http://ms.sbu.edu/SLAP_goals/slap_goals/Finance.doc

 

                Upon completion of the course, the student will be expected to:

1.       analyze an industry and a company’s position within that industry

2.       identify a company’s competitive advantage

3.       use the industry analysis, company positioning, and competitive advantage to develop forecasts for purposes of valuation

4.       value a company using several different techniques

a.       dividend discount models

b.       free cash flow forecasting

c.        market multiples

d.       residual income models

5.       create buy and sell recommendations based on company analysis and valuation models

6.       Intelligently discuss the Market Efficiency Hypothesis and Behavioral Finance

7.       Understand the role of indexes, pension funds, mutual funds, and hedge funds

8.       Basic understanding of  Markets (including NYSE, NASDAQ, and ECNs

 

The structure of this course is quite unique.  It is a student-run investment portfolio organized much like an independent money management firm with a management team and different functional areas.  Therefore, the progress of the fund and the implementation of the investment strategy (determinants of your grade) rely heavily on your initiative.  You will be expected to be proactive and operate with limited guidance.  This setting offers opportunity to be innovative and creative in your approach, and to learn from outside sources, such as industry professionals.   Unlike a traditional class, much of your direction will come from the management team instead of the instructor.

 

 

Prerequisites and Technology Requirements

 

FIN 301.  Students should have a basic understanding of the time value of money and the functioning of financial markets.  You should have a sound familiarity with MS-Excel and an understanding of how to manipulate data, formulas, and functions within MS-Excel. 

 

Required Text

 

Valuation by Aswer Damodaran


This class is cross listed as Finance 411.

For those taking this as finance 411, you will be expected fill the roles of leaders of the fund.  Hence you will have extra work to do which will include such things as fund raising, marketing, and reporting.

 

Grade

 

Because the Student Investment Fund is organized as a stand-alone money management firm, different students have different responsibilities.

 

Students are evaluated based on how well they fulfill the responsibilities associated with their position.  Analysts for example will be graded on the quality of their presentations of buy-sell recommendations, the depth of their industry analysis, and how well they implement the valuation techniques developed in class.

 

Midterm Stock Reports                      10%

Final Stock Report                              25%

Index Project /Test                              10%

Final Exam                                          20%

Weekly Participation                          35%

 

There will not be a curve, but there is a single 10 point extra “credit Assignment” Book report on Black Swan or Capital Markets Evolving (other books will be considered).

 

 

Late Assignments and Exams

 

This class is designed to parallel real world experience in the investment management profession.  As such, it will be a tremendous learning experience that will help increase your marketability in the labor market.  Therefore, no late assignments will be accepted.  So plan ahead.

 

Grading Scale

 

Exams and stock reports will be assigned a grade according to the following grading scale.  The student’s final average will be a weighted average of these grades according to the weights above.  The letter grade for the class will be assigned according to the following grading scale.

 

                A             93 – 100%

                A-            90 – 92%

                B+           87 – 89%

                B             83 – 86%

                B-            80 – 82%

                C+           77 – 79%

                C             73 – 76%

                C-            70 – 72%

                D+           67 – 69%

                D             63 – 66%

                D-            60 – 62%

                F              < 60%

 

Academic Integrity

 

                Exemplary academic integrity is expected and assumed.  The work you submit (e.g., examination, homework, paper) should be your own.  Students are expected to be familiar and comply with the University Policy on Academic Dishonesty (see pp. 50-57 of the 2005-2006 Student Handbook).  Violating this assumption to any degree is not tolerated and carries severe consequences.  Violators will be dealt with severely and handled in accordance with this policy.  Penalties include failing the course and are made part of the student’s academic record. 

 

Collaborating often times facilitates the learning process.  You may therefore consult with each other in limited ways.  Plagiarizers and cheaters will be dealt with strictly.  It is fairly easy to detect excessive collaboration in assignments (even when attempts are made to mask it.)  I have found cheating on computer assignments in this course as well as others and responded accordingly.  You are hereby put on notice.  If you have any questions as to what the appropriate boundaries are, please ask me before you act.  In the absence of that consultation, here are some guidelines.

a.       Copying files of someone else’s work is strictly prohibited.

b.       Copying formulas from another’s worksheet is prohibited.

c.        Consulting to understand the general approach and techniques is permitted.

Office Hours

 

                Please see me if you have questions.  I am available during the office hours above and generally during normal business hours save for time when I am in class.  I can be reach by phone or e-mail, as well.  See me early before a problem becomes unmanageable.  Conscientious students without class absences have priority for out-of-class assistance.

 

Students with Disabilities

 

Students with disabilities who believe that they may need accommodations in this class are encouraged to contact the Disability Support Services Office, Doyle Room 26, at 375-2065 as soon as possible to better ensure that such accommodations are implemented in a timely fashion.  Documentation from this office is required before accommodations can be made.

 

 

Incomplete and Withdrawal Policies

 

University Policy prohibits instructors from assigning a grade of Incomplete (I) to prevent a student from receiving a poor grade in the course.  A similar policy applies to withdrawals (W).

 

 

­Extra-Credit Policy

 

No opportunities for extra-credit will be given to select students.  Otherwise, students who are not given the same opportunity are put at a relative disadvantage.