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Michael F. Price Student Investment Fund the MPSIF Information Session November 7, 2012

Michael F. Price Student Investment Fund the MPSIF Information Session November 7, 2012. Richard M. Levich Professor of Finance. What is MPSIF?. It’s a class, formally FINC-GB.3320, “Managing Investment Funds” But not an ordinary class. It’s “Hands-On” “Experiential” “Learning-by-Doing”

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Michael F. Price Student Investment Fund the MPSIF Information Session November 7, 2012

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  1. Michael F. PriceStudent Investment Fundthe MPSIFInformation SessionNovember 7, 2012 Richard M. Levich Professor of Finance

  2. What is MPSIF? • It’s a class, formally • FINC-GB.3320, “Managing Investment Funds” • But not an ordinary class. It’s • “Hands-On” • “Experiential” • “Learning-by-Doing” • Admission is limited. By application only.

  3. What’s Special About MPSIF? • The structure • 3.0 credits, 3 hours per week – But 2 semester commitment (spring/fall or fall/spring) • Why? Continuity in management of real money. • The deliverables • Financial writing, oral presentations, financial decisions in a group setting • The goals • Honing analytical and presentation skills • Deeper understanding of governance and fiduciary responsibilities in running an endowment fund

  4. What Happens in MPSIF? • Students manage real money, roughly $1.70 million of NYU endowment • Students work in teams (4 funds) that manage separate pools of equity and fixed income investments • Students perform all of the key tasks • Economic, sector and company research • Stock selection, buys & sells, monitoring • Fiduciary duties – Proxy votes, minutes, Annual Report(s), Board presentations

  5. What Else You Can Expect • Short lectures from Professor overseeing the course • Presentations to an outside board of professionals • Guest speakers from industry including fund managers and investment strategists • Working with Stern School officials in Public Affairs, Admissions, Development, and Alumni Affairs to help showcase Stern and MPSIF

  6. MPSIF – Exec Committee Faculty Advisor MPSIF President + Treasurer + PMs Organization of MPSIF Management Advisory Council

  7. How are the Funds Run? • Students run MPSIF, but within limits. There are some “Rules of the Game.” • MPSIF is a long-only endowment fund. • Permitted securities include: Stocks, bonds, money market instruments, and limited mutual funds and ETFs. NYU is a tax-exempt institution. • Goals include (a) returns in excess of inflation over a 3-5 year period, (b) returns exceeding an appropriate benchmark, (c) a focus on long-term opportunities rather than short-term trading gains, (d) an acceptable level of diversification.

  8. MPG The Growth FundAs of November 2, 2012 Benchmark: Russell 1000 Growth

  9. MPSThe Small Cap FundAs of November 2, 2012 Benchmark: Russell 2000

  10. MPVThe Value FundAs of November 2, 2012Benchmark: Russell 1000 Value

  11. MPF The Fixed Income FundAs of November 2, 2012 Benchmark: Vanguard Total Return Fund

  12. How has MPSIF Performed? Since March 2000, our initial $1.80M endowment has shrunk to $1.66M as of 10/31/12, not counting $1.09M in mandated distributions; a 64.2% total return in 12.5 years (~3.92% p.a.), slightly ahead of the popular indices and our blended benchmark (75% equity and 25% fixed income).

  13. How Do I Join MPSIF? • Submit an application (to rlevich@stern.nyu.edu) • Submit a letter that • Describes your qualifications and explains why you desire to join the MPSIF. • Describes the contributions you can make to MPSIF and what you expect to gain by participating in the Fund. • Notes whether you have taken Foundations of Finance and whether you have taken, or intend to take Valuation. • Attach your current resume

  14. Final Thoughts on Applying to MPSIF • Open to Day MBAs and Langones • Foundations is required • Corporate and/or Valuation are helpful • Not just for Finance majors – This is a capstone course for anyone who wants a hands-on style course, and enjoys learning-by-doing in a less-structured setting. • To learn more, visit http://pages.stern.nyu.edu/~mpsif/

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