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Article
Publication date: 23 November 2021

Crystal Yan Lin

The purpose of this paper is to investigate the embedded challenges of student-managed investment funds (SMIFs) and provide recommendations to work with these issues.

Abstract

Purpose

The purpose of this paper is to investigate the embedded challenges of student-managed investment funds (SMIFs) and provide recommendations to work with these issues.

Design/methodology/approach

The paper analyzes and critiques the ways SMIFs are structured and operated and makes several suggestions.

Findings

The paper details seven unique challenges of SMIFs compared to professionally managed investment funds. The source of these challenges is that SMIFs are set up for educational purposes, which makes the operation and management different from performance-focused investment funds. The paper proposes several recommendations on how to align the educational focus with fund performance.

Originality/value

The paper is original and based on primary research.

Details

Managerial Finance, vol. ahead-of-print no. ahead-of-print
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 8 June 2021

Kobana Abukari, Erin Oldford and Neal Willcott

In recent years, student-managed investment funds (SMIFs), experiential learning programs at an increasing number of universities, have attracted significant scholarly…

Abstract

Purpose

In recent years, student-managed investment funds (SMIFs), experiential learning programs at an increasing number of universities, have attracted significant scholarly interest. In this article, we review the academic literature on this pedagogy.

Design/methodology/approach

We use the systematic review method to assess a sample of 85 articles published in 30 journals during the period 1975 to 2020.

Findings

Our literature review reveals four streams of research: best practices and challenges, investment management, innovation and trends and SMIFs in a research setting. We also propose future research directions, including specific gaps in the literature, a focus on innovations to traditional programs, systematic investment performance and expansion into behavioral finance issues.

Originality/value

We contribute a comprehensive view of the body of scholarship on SMIFs, identifying existing streams of research and future research directions that will help guide the development of SMIF research into a cohesive and productive space.

Details

Managerial Finance, vol. 47 no. 11
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 8 April 2019

Michael G. Mullen and Debra Salvucci

For undergraduate-only, AACSB-accredited business programs, establishing a student managed investment fund (SMIF) can be an enormous, but potentially worthwhile…

Abstract

Purpose

For undergraduate-only, AACSB-accredited business programs, establishing a student managed investment fund (SMIF) can be an enormous, but potentially worthwhile, undertaking. Resources are often very limited – especially for faculty where their time is already consumed by teaching, administrative and publishing requirements. The purpose of this paper is to reflect on the five-year experience at Stonehill College and suggest considerations for undergraduate institutions seeking to establish such programs.

Design/methodology/approach

This is a retrospective on the experience of designing and implementing a SMIF-based academic program. Student education and professional skill development should be the primary outcomes evaluated with such programs. Included are brief perspectives on the program from its alumni with commentary on perceived value in one to four years following graduation.

Findings

The experience to date suggests that establishing a SMIF at a smaller, undergraduate-only institution is challenging. For a SMIF to generate educational returns commensurate with its cost, it needs to be part of a comprehensive, academic-driven program that garners broad support by the business faculty and administration of the college. Personal reflections by its program alumni suggest that it can be a very meaningful academic and experiential learning opportunity.

Research limitations/implications

This paper is focused largely on the experience of one institution. Further insights may be attained by a broader, unbiased analysis of institutions where SMIF programs have succeeded or failed to meet similar objectives.

Practical implications

The authors suggests that the creation of a SMIF program at smaller, undergraduate-only institutions faces unique challenges relative to larger, more well-endowed universities. These challenges can be overcome but not without a broad internal commitment. These programs, if done in a comprehensive way, can significantly impact student outcomes.

Originality/value

The retrospective offers up-to-date insights on the value and challenges of starting a SMIF program at smaller-sized, undergraduate-only academic institutions.

Details

Managerial Finance, vol. 45 no. 5
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 29 May 2019

Erin Oldford

The purpose of this paper is to describe how a student-managed investment fund (SMIF) moved from an idea to an operational program over the period of a year at Memorial…

Abstract

Purpose

The purpose of this paper is to describe how a student-managed investment fund (SMIF) moved from an idea to an operational program over the period of a year at Memorial University in Newfoundland, Canada. The aim is to provide insight to other institutions on how to build capacity when developing their own SMIF.

Design/methodology/approach

I summarize the choices made with respect to funding source, governance structure, faculty involvement, recruitment, investment activities and integration into curriculum.

Findings

Underlying these choices were challenges pertaining to capacity, student competencies, the existing finance program and ties to industry. Through the development of the SMIF, efforts ensured that capacity was suitably developed in each of these areas.

Research limitations/implications

This paper provides insight to other institutions on how to build capacity while developing their own SMIF.

Practical implications

This account provides the field with a unique perspective. It is written following a year spent developing a SMIF that is about to launch.

Originality/value

This account provides the field with a unique perspective. It is written by a new faculty member following a year spent developing a SMIF that is about to launch.

Details

Managerial Finance, vol. 46 no. 4
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 7 November 2019

Charles M. Boughton and Katherine L. Jackson

The purpose of this paper is to understand the differences present in student-managed investment funds (SMIF).

Abstract

Purpose

The purpose of this paper is to understand the differences present in student-managed investment funds (SMIF).

Design/methodology/approach

The paper uses primary data collected by survey and interviews.

Findings

The findings of this paper suggest that research efforts need to be focused on the topical area and transparency in the field needs to be improved.

Research limitations/implications

Past research is validated and future research is needed.

Practical implications

The need to develop and disseminate best practices in the management of SMIF’s.

Social implications

Student-managed funds are widespread and growing but operate as independent entities.

Originality/value

The paper is original and based on primary research.

Details

Managerial Finance, vol. 46 no. 4
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 26 April 2019

Peter Ammermann, Pia Gupta and Yulong Ma

The student-managed investment fund (SMIF) program at California State University, Long Beach (CSULB), was launched in 1995 with one portfolio worth $50,000. In the two…

Abstract

Purpose

The student-managed investment fund (SMIF) program at California State University, Long Beach (CSULB), was launched in 1995 with one portfolio worth $50,000. In the two decades since then, the program has grown to include three portfolios with a combined value of more than $700,000, managed on behalf of three different clients. The purpose of this paper is to describe the creation, evolution and growth of the program including the development of the new quantitative approach and its subsequent implementation. The paper also discusses the ongoing organizational, educational and investment-management challenges associated with the program.

Design/methodology/approach

The paper includes a description of the development and evolution of the program along with a discussion of the investment results for one of its three portfolios.

Findings

The paper finds: the new quantitative approach implemented in the program is effective as insurance against “black swan” events; and SMIF-type programs can provide learning experiences both for students and faculty members.

Practical implications

The paper explains the practical application of the new quantitative approach as well as the educational benefits of a SMIF-type program.

Originality/value

The paper provides insight into the structure of CSULB’s SMIF program and discusses a unique quantitative approach to asset allocation and security selection.

Details

Managerial Finance, vol. 46 no. 4
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 7 June 2019

Samar Ashour, Craig G. Rennie and Sergio Santamaria

The purpose of this paper is to describe lessons learned from integrating student-managed investment funds (SMIFs) in finance education systems based on the case of the…

Abstract

Purpose

The purpose of this paper is to describe lessons learned from integrating student-managed investment funds (SMIFs) in finance education systems based on the case of the Raymond Rebsamen Investment Fund at the Sam M. Walton College of Business, University of Arkansas.

Design/methodology/approach

The paper has three main parts. First, it describes how the Rebsamen Fund operates as an integral part of undergraduate and graduate finance education at the Walton College. Second, it explains how the Fund spawned creation of sister funds, an institute, a 62-seat trading center, and coordinates with other agencies and stakeholders. Third, it lists strengths, weaknesses, opportunities and threats facing future SMIF integration into finance education.

Findings

The use of innovative experiential learning solutions like SMIFs bridging theory and practice can be enhanced by integrating them into effective systems of finance education.

Practical implications

Lessons learned include benefits of SMIF management by class, licensing and professional certification, trading centers, use of SMIF finances to support other components of education, proliferation of SMIFs, SMIF stimulation of academic units like centers/institutes, SMIF facilitation of collaboration, importance of tying SMIFs to student finance clubs, coordination of industry speaker visits between SMIF classes and clubs, and use of SMIFs in addressing cutting-edge challenges.

Originality/value

This paper discusses how SMIFs can be integrated in finance education.

Details

Managerial Finance, vol. 46 no. 4
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 28 March 2019

Derek Horstmeyer

The creation and formation of a student managed investment fund (SMIF) is a risky proposition for all stakeholders involved in the process. These risks include…

Abstract

Purpose

The creation and formation of a student managed investment fund (SMIF) is a risky proposition for all stakeholders involved in the process. These risks include reputational risks for the individuals involved, fiduciary risks for the school’s Board of Trustees and monetary risks for the university itself. The purpose of this paper is to explain and detail how these risks can be mitigated through specific oversight committee (OC) construction, distributional/benchmarking requirements for the fund and detailed trading rules (exit points, short sale constraints, loss provisions, etc.) for fund managers, which can all be codified in the bylaws of the SMIF.

Design/methodology/approach

This investigation is done through a specific case study – the 2017/2018 formation of the George Mason University SMIF. As head of the OC for the fund and lead architect in the creation of the fund for the GMU faculty, the statements below come from firsthand accounts of dealing with all parties of interest and firsthand knowledge of the year-long process of managing all risks, which culminated in being granted endowment capital from the Board of Trustees to officially begin the SMIF on May 1, 2018.

Findings

First, this paper details how a complete investment policy statement can be used to mitigate the fears and concerns of all parties that have a fiduciary duty to the university’s endowment (which the students will now be partially managing). These bylaws include statements on the risk characteristics of the fund, distributions back to the endowment, oversight features and benchmarking. Next, written into the bylaws of the fund can be several benchmarking and distributional requirements to mitigate the risk exposure of the SMIF’s holdings. Finally, aside from benchmarking constraints, another successful risk management technique can be rules written directly into the investment policy statement that define exit points, tracking error, short sale constraints and other rules for trading.

Originality/value

This paper offers a roadmap by which these risks can be mitigated through the content of an investment policy statement/bylaws. The author details several techniques that eventually led to all stakeholders at GMU in signing off on the formation of an SMIF, and endowment capital being given to the fund as a seed investment. This is a firsthand account of this process and the author has not seen it documented in the literature anywhere else.

Details

Managerial Finance, vol. 46 no. 5
Type: Research Article
ISSN: 0307-4358

Keywords

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Article
Publication date: 16 August 2019

Naomi E. Boyd, Gulnara R. Zaynutdinova, Michael Burdette and Nathan Burks

The purpose of this paper is to expand the domain of experiential learning by sharing the experiences of establishing and developing student managed investment fund (SMIF

Abstract

Purpose

The purpose of this paper is to expand the domain of experiential learning by sharing the experiences of establishing and developing student managed investment fund (SMIF) at West Virginia University (WVU).

Design/methodology/approach

This paper discusses the structure and performance of the SMIF at WVU within the context of experiential learning literature in financial education.

Findings

The adopted structure and coordination of SMIF appears to be effective in bridging the gap between classroom and the professional world, while significantly enhancing student experiential learning opportunities, engagement and professional preparedness.

Originality/value

The paper presents experience of launching and operating a SMIF at WVU, which has recently joined the ranks of R1 research universities. While the importance of research productivity has been on the rise, the significance of strengthening student experiences has also been growing and maintaining the balanced approach can be challenging. Enrollment in WVUs undergraduate finance program grew 33 percent over the past three years. With growing enrollment and competitiveness of finance degree programs, experiential learning opportunities like WVU’s SMIF are an essential for an evolving curriculum.

Details

Managerial Finance, vol. 46 no. 5
Type: Research Article
ISSN: 0307-4358

Keywords

Content available
Article
Publication date: 27 September 2019

Chinmoy Ghosh, Paul Gilson and Michel Rakotomavo

The purpose of this paper is to present a review of the student managed investment fund at the School of Business, University of Connecticut.

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Abstract

Purpose

The purpose of this paper is to present a review of the student managed investment fund at the School of Business, University of Connecticut.

Design/methodology/approach

The authors trace the history and growth of the fund and identify the special features and dimensions that have contributed to its success.

Findings

The operation of the fund is a constantly evolving program and the authors discuss the important changes and improvements made in the program since its inception in the early 2000s in response to growth in the number of finance majors, new career opportunities in the field of investments and most importantly, the strength of capital markets and the development of new instruments in the capital markets. The authors also discuss the common features of over 300 student funds in the USA. The authors close with a discussion of the limitations and constraints the fund advisors at, and possibly, at other schools, face in the management and administration of the fund, and also what developments and adjustments the authors expect to see in these funds in the future.

Originality/value

The authors combine extensive analyses of fund history and performance. The authors also provide some suggestions for the future direction and priorities for student funds.

Details

Managerial Finance, vol. 46 no. 4
Type: Research Article
ISSN: 0307-4358

Keywords

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