1 / 24

Presentation to the University of Connecticut Foundation April 24, 2003

MBA Student Managed Fund. Presentation to the University of Connecticut Foundation April 24, 2003. Today’s Agenda. SMF Performance vs. S&P 500 Investment Philosophy Portfolio Strategy Lessons Learned Market Outlook Questions. MBA Portfolio Managers. Ventzislav Adamov Amitabh Basak

olympe
Download Presentation

Presentation to the University of Connecticut Foundation April 24, 2003

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. MBA Student Managed Fund Presentation to the University of Connecticut Foundation April 24, 2003

  2. Today’s Agenda • SMF Performance vs. S&P 500 • Investment Philosophy • Portfolio Strategy • Lessons Learned • Market Outlook • Questions April 24, 2003

  3. MBA Portfolio Managers • Ventzislav Adamov • Amitabh Basak • Eliza Biedziak • Lily Ding • Radu Popescu • Xin Shi • Monica Simsek • Vasim Vasgare • Wiebke Wanner-Borchardt April 24, 2003

  4. SMF vs. S&P 500 • SMF Fund’s overall return is 7.27% SMF has outperformed S&P 500 April 24, 2003

  5. Investment Philosophy • Initially • Uncertain outlook led to conservative approach • Strong confidence in Health Care and Consumer Staples • Low confidence with IT and Financials • Now • Remain confident in Consumer Staples • Guarded optimism for economic turnaround April 24, 2003

  6. Stock Selection Criteria • We look for: • Solid financials • Strong management • Consistent earnings growth • Attractive valuation relative to the index • Higher Return/Risk relative to market • Buy Criteria • Steady growth rates • Intrinsic value >market value • Above average yield • Upside-downside ratio • of at least 2 • Sell Criteria • Stock reaches its price objective • Industry-sector weighting exceeds • predetermined limits • Risk/reward profile deteriorates • Earnings figures lower than estimates In total, we have analyzed 53 stocks. April 24, 2003

  7. Stocks Presented April 24, 2003 purchased sold not purchased

  8. Stock Selection Process Search for stocks in respective sectors that match our investment philosophy and selection criteria Do you think this will outperform the market in the long run ? No Yes Prepare Stock Valuation Report and submit it to the group for VOTING Does the group think that this stock will outperform the market ? No Yes Recommend this stock for a BUY April 24, 2003

  9. Methodology Financial Analysis: • News and recommendations: Yahoo! Finance, MSN Money Central, Quicken, Value Line, Reuters, Multex Investor, Wall Street Journal • Value Line: Safety Rank and Beta • Models: DDM,FCFE, Zero Growth, SSG • Relative Valuations: P/E • Benchmarking • Stop-loss: 15% depreciation from buy price • Upside review price between: 15% and 30% appreciation April 24, 2003

  10. SMF Holdings(as of 04/11/03) April 24, 2003

  11. SMF Holdings • Why ~65% invested in S&P 500 Index Fund? • Inability to find individual stocks satisfying our strict buying criteria due to high volatility and continuously changing market, economic, and political situation • Adopted a conservative approach at the beginning • Could not utilize the funds in the short term after converting them to S&P Fund from Bonds April 24, 2003

  12. Best Performers April 24, 2003

  13. Worst Performers April 24, 2003

  14. Analyst Report: Abbott Labs • Business Model Analysis • Financial Data Benchmark • Valuation Models: • Is this a good company? • Is the stock a good value? • Is the stock a buy? • Risk Factors • Recent News • SWOT Analysis (Strengths – Weaknesses – Opportunities – Threats) April 24, 2003

  15. Analyst Report: Abbott Labs • Report • Value Line Investment Survey • SSG April 24, 2003

  16. Analyst Report: Abbott Labs April 24, 2003

  17. Managerial Performance - % of Pretax Profit Sales - % Earned on Invested Capital Risk vs. Reward Analysis: Is the stock in a buy zone? Total Return: 5-year potential April 24, 2003

  18. Lessons Learned • Stock selectionprocess • Holistic approach with emphasis on company’s business risks • Identify right stock that matches our value growth investing strategy • Focus on fundamental analysis and on stocks with growth potential and low volatility • Upside review and Sell discipline • Act in timely manner April 24, 2003

  19. Lessons Learned • Analyze impact of geopolitical issues on market behavior • Look at macroeconomic trends • Understand investor’s reactions to economic indicators • Look for management shenanigans • Analyze 10k reports and pay particular attention to footnotes April 24, 2003

  20. Going Forward Opportunities: • Military victory in Iraq raises prospects for economic turnaround • Administration’s fiscal stimulus program promoting growth – Possible elimination of double taxation on dividends • Improved GDP growth April 24, 2003

  21. Going Forward (cont.) Risks and Threats: • Geopolitical concerns still prey on the minds of business executives • Issues concerning Post-war Iraq and negative economic data making businesses cautious on spending • Ballooning Federal budget deficit raises concerns April 24, 2003

  22. Going Forward (cont.) Suggestions: • Maintain Risk Control as volatility is high because investors are looking at weekly economic indicators • Invest in Consumer Staples April 24, 2003

  23. Thank you to: • University of Connecticut Alumni Foundation • Investment Advisory Board • Dr. Chinmoy Ghosh • Mr. Pat Terrion • Karthik Krishnan April 24, 2003

  24. Questions?

More Related