How Ohio State Fund Invests Its $24 Million

With a portfolio currently valued at about $24 million, Ohio State University's Student Investment Management (SIM) program prepares undergraduates and graduates for the investment world by putting them in charge of the largest student-run fund on the planet. Here's a look at how this group steers such a large ship.

SIM Quick Facts

• Established: 1990
• Membership: Approximately 30 each academic quarter
• Application process: Students sign up as they would for any other class
• Money under management: $24.3 million (approximate current value)
• Portfolio/fund type: One stock portfolio, currently with 27 holdings
• Benchmark: S&P 500 Index (SPX Quote - Cramer on SPX - Stock Picks)
• Time-horizon/style: Long-term, value

Now entering its 18th year, the SIM program at Ohio State's Fisher College of Business started in February 1990 with $5 million of the university's endowment. "No doubt about it, they're the very top in size, and they have been since their creation. The other schools are still catching up," says Dr. Edward Lawrence, a professor of finance at the University of Missouri who is conducting a survey of the world's student-run investment funds. (According to Lawrence, depending on daily fluctuations in portfolio valuation, the University of Minnesota's student-run fund could potentially tie the size of Ohio State's SIM fund.)

Structured like a class, SIM students become analysts for the portfolio and are each assigned to monitor a particular stock held by SIM. Groups of students that follow similar stock holdings team up to follow whole sectors . At the end of each academic quarter, students have to make a buy, sell or hold recommendation about their stock. That recommendation is then voted on by the entire SIM group.

Unlike many student-managed funds that require a rigorous application process, signing up for Ohio State's SIM program is relatively simple. Matt Falk, SIM's Graduate Associate explains: "There's obviously limited seating, but really it just comes down to registering for it like any other class. There is one basic finance prerequisite [a fundamental course in security markets and investments], but some undergrad students come into the class having no stock experience, while we may have graduate students that come in who are CFA [Chartered Financial Analyst] members." Falk adds that this knowledge gap is part of the reason SIM only trades once at the end of the quarter, when everyone in the group is up to speed on the investing game.

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