UAB Green and Gold Fund Provides Rich Opportunity

Laura Bordelon spent much of her first two years at UAB looking for the right organization to complement her double major in finance and accounting. She finally found it last year when she became involved in the UAB Green and Gold Fund, a student-managed portfolio that was developed by the UAB Finance Department in 2005 to raise funds for scholarships for the School of Business.


"I wanted to juice up my resume, so I got involved in all these different organizations and clubs," says Bordelon, who is now a senior. "And then I got involved in the Green and Gold Fund and I felt like, ‘This is it. This is where I want to focus all of my free time.'


"It's so interesting, because it's more than just attending meetings and listening to speakers. You're actually investing real money. It's such a hands-on experience, and it's been so much fun."


The Green and Gold Fund launched in 2005 with assets of more than $300,000 to manage and a goal of growing the portfolio to $500,000. When the goal is reached, a percentage will be used to provide scholarships.


The students who are accepted as members meet once a week and work as analysts and portfolio managers under the guidance of an academic advisor. They also receive input from members of the Financial Advisory Board, which is made up of working professionals who volunteer their time as advisors. The objective is to come up with real-world investment strategies, involving real money.


"A few years ago anyone could invest and make money, but no longer," says Stephanie Rauterkus, Ph.D, academic advisor for 2007.  "In just the past six months, when markets were really down, our students were outperforming some of the professionals."


Their outstanding performance was recognized in April at the RISE (Redefining Investment Strategy Education) national competition in Dayton, Ohio where they finished No. 1 for the growth-style portfolio category in the undergraduate division consisting of teams from over 50 other business schools.  The UAB Green and Gold Fund launched in 2005 with $300,000 in assets and ended 2007 with a portfolio value of just over $400,000.


"Our students gain more than financial rewards," Rauterkus says. "They earn valuable experience that strengthens their classroom work and helps advance their careers."


That's experience they take seriously for themselves, the members of the investment team, and the ultimate goal of the fund. "If we lose something, we're losing real money," says Adil Faizee, a senior majoring in finance. "If we bought something and it's down 15 percent, we as a group are looking over that stock, and we have to decide what to do.


"If you do it in a hypothetical world where you're not dealing with real money, you're not that worried about a 15-percent drop, because you don't really lose anything. It's a psychological thing. But when you know the portfolio returns actually have to be at a certain level, it creates a lot of motivation to do a good job."


Warren Ballard, a senior majoring in accounting and finance, says he was interested in the stock market well before he reached college. As a kid, he regularly read his newspaper's financial section because he wanted to grasp business and market fundamentals. Instead of reading the latest Harry Potter novel, he devoured investment advice from the likes of Warren Buffett.

So Ballard has been eager to enter the world of financial investing, and he says he is getting a true taste of what it is like through his involvement with the Green and Gold Fund.


"The setup is similar to what's going on in a real investment firm, like a hedge fund," Ballard says. "We have portfolio managers over the different sectors and analysts under them. The analysts do all the research, and then they send recommendations to the portfolio managers, who sit down together and talk about the stocks and vote on what stocks to invest in. It's definitely real-world experience."


That is the goal of the Green and Gold Fund-to give students a jump start on experiencing what their financial careers might be like. Ballard has completed an internship with Southern Company that he hopes will lead to a full-time job upon graduation. Faizee wants to start as an investment banker and eventually operate a hedge fund on the international market.

As for Bordelon, she is focusing on her new role as the chief investment officer for the Green and Gold Fund, which is the highest position a student can hold in the organization.


"It's been a great experience," she says. "I had no idea when I started this that I would be this involved. I've focused most of my extracurricular activities on the Green and Gold Fund. For many finance majors, this is what they will eventually be doing, so I've tried to absorb as much as I can. It's been a great opportunity."


By Cary Estes

UAB Green and Gold Fund