As real world as we can get

Donations support students’
market investment experiences

How do you get students motivated to learn about business?

Give ’em a few bucks.

Thanks to some generous gifts to the college, CMU business professors have collaborated across disciplines to get the most mileage from donations by allowing students to work with real money within their areas of expertise.

It’s all part of the real-world curriculum that
the College of Business Administration prides itself on.

“One of the things I like to do is get students to where they’re not just learning out of the textbook,” said Jim Felton, finance chair. “I have them read Wall Street Journal articles and get involved in stock-picking contests. So their grades are affected by their knowledge of the stock market. For example, the weather in
Brazil is a factor if they’re doing coffee
futures contracts.”

Investment cycle
managed by students

The money that donors and friends invest in CBA has an impact on nearly every department.

For example, alumnus Tom Celani, president of Motor City Harley-Davidson and Buell of Farmington Hills, allows marketing and entrepreneurship students to get hands-on experience with advertising and sales by selling all-terrain vehicles through his business. The motorcycles, four wheelers, and other recreational equipment are auctioned on eBay and sold through direct marketing. Celani donates the vehicle sale proceeds, which bring in revenue to the college.

In the initial auction of motorcycles, entrepreneurship student Yuki Watanabe said he learned a great deal through the real-world application of marketing knowledge as project manager.

“I have learned the importance of promotion and advertising and how much creativity and teamwork it takes in the real world,” he said.

From there the money goes to finance students, who decide how to invest it and grow a healthy portfolio.

Finance students manage the college’s two investment funds – the Martha Seger Fund and the Celani Fund, which includes proceeds from the motorcycle sales. Students enrolled in a portfolio management class have the opportunity to pick stocks, make a portfolio, and make annual adjustments to the portfolio.

“It’s a great way for students to learn about investments because they’re dealing with real money,” Felton said. “They’re making the choices about how diversified we are, if we’re taking the right amount of risk, if we’re in the right sectors and the right industries – they’re actually applying all they’ve learned in all their other classes.”

From the finance students, the funds, which now have grown to approximately $25,000, go to the college’s Make-A-Pitch Competition. This competition challenges students from across CMU to create innovative business plans and win seed money to actually start new businesses.

What does all this mean to students? Experience.

“When they’re looking for a job they’ve already had experience managing a portfolio. They already speak the language for the kind of career they’re going into,” Felton said. “Business students at CMU get a really well-rounded education. We make it as real world as we can get.”

CMU graduate student Sam Scherf, left, and senior David Apsey, right, give a presentation on how the stocks they picked to manage performed for their portfolio management class project.

Professor Jim Felton uses the John G. Kulhavi room’s state-of-the-art technology to enhance the students’ portfolio presentations.

Student-managed investments

• Gifts that donors and friends invest in CBA
  have an impact on nearly every department. Follow the money through the college to see
  for yourself.
  
• Donations of products such as motorcycles
  give marketing and entrepreneurship students the chance to do real-world advertising.
  
• Proceeds from sales go to the college’s investment funds, which are managed by finance students who make important
  decisions about how the money should be invested for the future.
  
• As funds grow through wise investments, money is set aside for the college’s Make-A-Pitch competition, which encourages any
  CMU student who has a business-related
  idea to create a plan and win seed money.
  
• A dream becomes a reality, providing yet another real world business opportunity.
  The cycle begins again.