UNA investment challenge team hopes to win 10th performance award

UNA’s Tennessee Valley Authority Investment Challenge team has high hopes for this investment year.

Each year, TVA invites student investment teams to participate in its investment challenge. TVA gives each student investment team an allotted amount of money to invest in the stock market. The students manage their investment portfolios with hopes of out-performing the market average, the S&P 500.

“Every university who’s managing money is charged with beating a market index, the S&P 500,” said finance professor and investment challenge supervisor Kristy Van Rensselaer. “We call that the market. We’re supposed to manage the portfolio in such a way that we beat this market index.”

The TVA Investment Challenge is an elective class available in the business department where students manage investments for TVA. The class is open to any student. However, Van Rensselaer said most of the students who participate are senior business students.

The business department has participated in the challenge since its inception in 1998. Since then, UNA has won over $18,000 in performance awards, said Finance Professor and Investment Challenge Supervisor Kristy Van Rensselaer.

If the university’s investment portfolio beats the market index, the university receives a performance award. In the last 10 years, UNA won four service awards and hopes to win their fifth at the end of this year.

Van Rensselaer said TVA announces the performance awards in February of each year.

“We don’t always beat the S&P every year, but we’re always in the hunt,” she said. “We’re close just about every year. If everything goes right, it looks like we’re going to do it this year, too.”

UNA’s investment portfolio has a current worth of $612,000, she said.

“In general, when you look across all the schools, (TVA) earned a good rate of return from what these student managers have been able to invest in,” she said.

Students must fill out an application for the class and may take it more than one time, she said.

“It is one of the few classes you can take twice because the markets are always different, so it’s a learning experience both times,” Van Rensselaer said. “For me, it helps me to have someone come in and take it again because they know the ropes, and they almost act as a mentor to the other students.”

Senior finance major Brian Carpenter is taking the class for the second time. He said he thinks the class helped him better understand how to manage an investment portfolio.

“Managing a portfolio really gives you a first-hand experience and knowledge of how the global economy and markets operate,” Carpenter said. “Since I took it in the spring and this fall, I learned how markets can fluctuate and cycle throughout a year depending on macroeconomic events and the normal business cycle of the American economy.”

The class also helped him understand how global events cause the market to fluctuate.

“I absolutely think all business students should take this class at least one semester,” Carpenter said. “It’s too much of a valuable opportunity that UNA offers not to take advantage of.”

The challenge gives students an experience unlike any assignment or classroom exercise, Van Rensselaer said.

Carpenter said he thinks the this year’s team is doing a great job and has high hopes for this year.