Forty-Niner Shops, Inc. is giving $100,000 to Cal State Long Beach students, sort of.
The Student Management Investment Fund program allows CSULB students to manage three portfolios that total more than $300,000. Among its customers is Forty-Niner Shops, which gave the student-investment advisers $100,000 in fall 2009.
“The students were well prepared and confident in their risk management strategy,” CEO of Forty-Niner Shops, Inc. Don Penrod said. “They were professional and serious about their ideas. They sold us on their ability to safeguard the company assets and, as a result, we agreed to fund the account with $100,000.”
The program, directed by Cal State Long Beach finance professor Lowell R. Runyon, started in 1995 with one portfolio of $50,000. It made efforts in 2008 to start working with Forty-Niner Shops; after several meetings in 2009, the Forty-Niner Shops board of directors voted to work with the students.
Bruce Sparks, a student in the program and an MBA candidate in finance, said, “We take all that we’ve learned in classes and apply it to real portfolios, and we have to justify every decision we make.”
Sparks said that students pay a price of time and energy toward the program, but added that it’s worth it.
The students invest assets in the stock markets and must perform three to four presentations a year for each portfolio. The program also counts networking and building contacts from business professionals as a third of their grade.
Forty-Niner Shops funds the printing of the program’s annual report, which saves the program $1,500 to $2,000 yearly, according to a Forty-Niner Shops press release.
“[Forty-Niner Shops] really is student oriented,” Runyon said. “Even though they receive a lot of complaints from people concerning the price of textbooks, they really support student organizations.”
According to its website, the student-investment program is open to students by invitation only since it’s an honors-type program. It has several prerequisite classes that are required before one can take the six-unit class. Once enrolled, students must commit to it for the entire year.
Last summer, about 50 students went through a grueling application and screening process until 15 were accepted into the honors class.
“Students generally put at least 20 to 25 hours a week into this class,” Runyon said.
Because the students are working with real money, they also have to work through winter and spring breaks.
Runyon said the focus is on jobs and emphasized that the program wants to create opportunities for work experience. When an employer tells a student they need to have experience, managing portfolios for the program can look good on a student’s resume.
“We’re pleased it has become a showcase program for the CSULB College of Business Administration,” Runyon said. “[Students work hard to make] the program one of the best among similar programs throughout the United States.”
CSULB will host on Nov. 19 the Annual Portfolio Management Request-for-Proposal competition conducted by the Chartered Financial Analyst Society of Orange County Foundation. The program’s students will compete for a $100,000 portfolio, which they’ve won seven years in a row.
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