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Siena Wins Stock Investment Competition

Monday, April 22, 2013

By Sarah Vistocco '13

A team of ten Siena College students with a strong acumen for investing have won a stock portfolio management competition called the Adirondack Cup. Students from 18 colleges and universities from throughout the northeast participated in the unique competition during which they spent the past six months creating and developing hypothetical small cap stock portfolios worth $1 million. The stocks in their portfolios were similar to those managed by professional investors at the contest’s sponsor, Adirondack Small Cap Mutual Fund. The company is based in Guilderland, N.Y.

“The success of our team is further testament to the strength of our finance major/program and the hard work of our dedicated faculty and talented students in understanding the complexities surrounding the world of investments,” said School of Business Dean Jeff Mello, Ph.D.

When the competition began last October, the students were required invest in five small cap stocks, defined as companies with market caps between $50 million and $3 billion. Each of the stocks had to be from a different industry and each holding had to be at least five percent but no more than 50 percent of the team’s portfolio. The students were allowed to make only two changes to their portfolios throughout the competition.

Siena’s portfolio impressed the pros.

“I had the pleasure of visiting the Siena team recently and was impressed with their research process,” said Adirondack Co-Portfolio Manager Greg Roeder. “The biggest winner in their portfolio was Albany Molecular Research Inc. (NASDAQ: AMRI), whose headquarters is located not far from campus. This stock’s value rose 65 percent while it was in the Siena portfolio. The team made a timely bet on AMRI’s recovery earlier this year and that decision ultimately helped them take first place.”

Siena’s hypothetical portfolio had a 45.79 percent return, resoundingly beating the Russell 2000 Index, which measures the performance of small cap stocks in the United States. The index had a return of 15.40 percent for the period.

Professor of Finance Eric Girard, Ph.D. served as the team’s advisor. “I don’t tell them which stock to pick, said Girard. “They pick their stocks, I suggest a strategy.” Girard added that the key to winning is consistency. “I pretty much ask them to be consistent with what they believe the future will be,” Girard said.

One of the Adirondack Cup’s goals was to teach students the difference between trading stocks and thinking through their investment decisions for the long term. The competition, which is in its second year, is also designed to help students make connections in the field of financial services.

“We have a strong network of clients, particularly in the Northeast, who have been actively tracking the performance of students from their favorite schools,” said Adirondack Principal Steve Gonick. “This has given the students a great opportunity to build their contacts as they enter the workforce.”

Senior Officer for the Adirondack Cup Josh Eldredge ’13 said that participating in the competition has given him an advantage. “This experience has provided me, personally, several networking opportunities in the Capital Region,” Eldredge said.

As winners of the Adirondack Cup, the students will present their portfolios to managers of the Adirondack Cup. Rounding out the top five finishers in the competition were St. Lawrence University (with a 44.15 percent return), St. John Fisher College (42.05 percent return), Union College (31.13 percent return) and Rochester Institute of Technology (29.93 percent return).

The other colleges participating in the competition included Binghamton University, Bryn Mawr College, Clarkson University, The College at Brockport, The College of Saint Rose, Hofstra University, Ithaca College, State University of New York at Geneseo, State University of New York at Plattsburgh, Stony Brook University, Stony Brook University Graduate School, University at Albany and Wesleyan University.

Siena College students have had marked success managing stocks of all sizes. Since its inception, the student-managed Bjorklund fund has outperformed the S&P and Russell 2000 thus demonstrating Siena students’ capability with both large and small firms.

Along with small classes and direct interaction with faculty, Siena College offers its students in the School of Business real-world experiences and access to cutting-edge technology and financial software. Siena’s William R. Raub ’85 Market Trading Room houses computers equipped with Bloomberg Professional software and a ticker that displays real-time market news and data delivered by Reuters.

Contact: Ken Jubie
Contact E-mail: communications@siena.edu

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