GW INVESTMENT INSTITUTE INSIGHTS

Dear Friends and Supporters of the GW Investment Institute,

I am pleased to present the GW Investment Institute’s fiscal year 2024 annual report, which highlights an extraordinary year of academic achievements. The GW Investment Institute team is as strong as ever. Our team members are Christine Song and Bill Collier, adjunct faculty; Bojana Jankovic, Associate Program Director; Kathleen Hinman, Program Associate; Willow Newcomb, Communications Associate; and our student interns were Will Ahrens, Yaseen Shah, Elizabeth Ellis, Clement Banwell, Roman Salygin, Paige Graves, and Victoria Matthews. With this fantastic team, we taught five finance classes associated with the GW Investment Institute (GWII) curriculum, hosted 31 industry professionals, and organized industry visits to Sands Capital and Cushman and Wakefield. Additionally, we launched the Quantitative Investment Project to quantify GWII’s Business, Management, Price/Valuation, and Balance Sheet (BMPB) investment framework.

I am proud to announce that we awarded $50,000 in financial accolades to our top 10 performing students, this year’s Ramsey Scholars, for their outstanding dedication and hard work. We also presented the GWII Stock Pitch Awards, funded by the Charles Schwab Foundation, to the six students with the top three stock pitch presentations per semester, totaling $2,500. Moreover, we honored three exceptional students with the GWII Leadership Award, each receiving $2,000.

We continued integrating FactSet into our classes and collaborated closely with BlackRock, allowing our students to gain valuable insights into risk management using their Aladdin technology.

Last fall, we hosted the inaugural Ramsey Scholars Investment Summit, welcoming five cohorts of accomplished Ramsey Scholars who have driven exceptional growth in the GW Ramsey Student Investment Fund over the past five years. This spring, we held an alumni reception in New York City, reconnecting with former students. Furthermore, our Annual Conference on AI & Finance brought together over 60 students, faculty, and alumni, fostering thoughtful discussions on the latest advancements in artificial intelligence within the finance sector.

We continued participating in the McGill International Portfolio Challenge for the sixth consecutive year. Additionally, we were excited to send a GW team to compete in Cornell’s Women in Investing Conference for the first time, marking a new milestone in our commitment to fostering diverse talent in the finance industry.

While our primary goal is to educate students on investment strategies, capital preservation, and growth, I’m pleased to highlight that our Student Investment Funds have again outperformed the S&P 500 Index. This achievement underscores the effectiveness of our educational approach and the exceptional capabilities of our students.

I extend my heartfelt gratitude to our dedicated students, professors, staff, teaching assistants, advisory and governing board members, portfolio advisors, and guest speakers, whose unwavering commitment advances our mission of excellence in experiential investment education. Your collective efforts have led to our remarkable success. A special welcome to our advisory board members, Greg Wong, GW MBA ‘96, and Aron Kershner, BBA ‘05, who joined this past year.

Our achievements and the outstanding performance of GWII’s Student Investment Funds are a testament to the support of our extensive network of over 1,400 alumni, faculty, and staff. On behalf of GWII, I extend my most profound appreciation for your ongoing support and active participation. With immense enthusiasm, I look forward to the future of GWII, confident in our ability to continue advancing the field of investment education and significantly impacting our students’ professional journeys.

Sincerely, 

Rodney E. Lake
Director, GW Investment Institute

We invite you to review the full report below:

Introduction

During the June 30, 2024 quarter, the GW Investment Institute (GWII) hosted five industry professionals across two finance classes. The semester culminated in 17 stock pitches, five startup idea presentations, and the conclusion of the first semester of the Quantitative investment project. Ten students were awarded GW Ramsey Scholars awards, three received the GWII Stock Pitch Awards brought to by the Charles Schwab Foundation, and three were recognized with GWII Leadership Awards for a total of $57,250 awarded. A quarter highlight was the NYC Alumni Reception, which successfully brought together over 30 alumni. Haya Adnan, a GWSB senior graduating in December 2024 with a major in Business, wrote the following commentary.

Market Commentary

Prepared by Haya Adnan, GW ‘24

The S&P 500 Index wrapped up strong in the second quarter of 2024, hitting record highs signaling a robust equity market. This was followed by slowing growth in non-farm payrolls and unemployment reaching a 2 ½ year peak at 4.1%, leading to heightened expectations for interest rate cuts in the third quarter. Despite inflation cooling faster than expected to 3%, moving closer to the Fed’s 2% target, the second quarter of 2024 saw none of the previously anticipated rate cuts.

Significant performance could be observed in sectors like Communication Services (9.4%), driven by Meta and Alphabet investing aggressively to build out their AI infrastructure, and Information Technology (13.8%) as Microsoft and Apple recover from a slower first quarter, and Nvidia continues its tech dominance, continuing the trend of a few exceptional stocks driving up the market. Comparatively, the Healthcare industry declined (-1.0%) in Q2, followed by Real Estate with (-1.9%) as borrowing costs remain elevated across the sector with interest rate headwinds, and the Materials industry with the most significant downturn (-4.5%), likely due to lower prices in the commodity and chemical markets.

The GWII Student Investment Fund performance for Q2 2024 was 9.7%, outperforming the S&P 500 Index by 5.4%. Individually, the GW Ramsey Fund outperformed the S&P 500 Index by 6.5% at 10.8%, the GW Phillips Fund outperformed by 3.7% at 8.0%, and The GW Quant Fund outperformed by 5.0% at 9.3%. The GW Real Estate Fund underperformed the S&P 500 Index at 0.3%; however, outperformed the FNERTR Index by 1.2%.

We invite you to review the full report below:

In Episode 7 of “Market News with Rodney Lake,” Rodney Lake, Director of the GW Investment Institute, discusses the critical alignment of management incentives with shareholder interests. He uses Tesla’s unique performance-based pay package as an example to highlight the importance of evaluating compensation packages through proxy statements. Professor Lake advocates for a mix of metrics like market cap, revenue, and profit margins to assess true company value, cautioning against sole reliance on earnings per share metrics due to potential manipulation. He underscores the significance of operational efficiency, a key factor that demands the audience’s attention and focus. He also stresses the importance of employee satisfaction and long-term growth strategies, drawing on successful examples like Apple and Visa. Tune in to learn more!

In Episode 6 of “Market News with Rodney Lake,” Rodney Lake, the Director of the GW Investment Institute (GWII), explains the business aspect of GWII’s BMPB framework (Business, Management, Price/Valuation, and Balance Sheet). He explores the practical applications of the DuPont formula in evaluating business quality, underscores the importance of understanding the utility of products and services, and delves into key financial metrics like Return on Equity. Using examples like Apple (NASDAQ: AAPL), he demonstrates how high profit margins and customer loyalty contribute to business value.

Thanks to the generous contribution of GW Investment Institute (GWII) Advisory Board Member Greg Wong, GWII proudly acknowledges students who have made a material contribution to the institute and have significantly impacted our community with the GW Investment Institute Leadership Award.

Three outstanding students are awarded a $2,000 financial award each this year. Meet our esteemed 2024 Leadership Award Recipients:

• Will Ahrens, B.S. Accountancy & Finance      
• Rhys Chambers, B.S. Computer Science & International Business            
• Yaseen Shah, B.S. Finance

Will Ahrens’ academic journey includes courses in both Applied Financial Securities Analysis and Foundations of Venture Capital with GWII. Will’s commitment to assisting the institute as a teaching assistant for the Applied Financial Securities Analysis class for two semesters reflects his ongoing dedication to the institute. Outside of class, he was an intern in the GWII Venture Capital Internship Program, a GWII student project assistant, and competed in the 2022 McGill International Portfolio Challenge.

Rhys Chambers was the first GW student to attend Cornell’s Women in Investing Conference in 2022. She returned with a team in 2023 to compete against Columbia, Claremont McKenna, and Cornell. She also participated in the 2022 McGill International Portfolio Challenge with Will Ahrens and Ameen Iraqi, securing a position in the top 25 internationally.

Yaseen Shah took the Applied Financial Securities Analysis class and earned recognition for his exceptional final buy/sell stock pitch with a GWII Stock Pitch Award brought to you by the Charles Schwab Foundation. Additionally, he has pursued studies in GWII’s Foundations of Venture Capital class and was the teaching assistant for the course this past semester. Yaseen competed in the McGill International Portfolio Challenge in 2023.

The GW Investment Institute Leadership Awards started in 2019; to date, $22,000 has been awarded to students.

Thanks to a grant from the Charles Schwab Foundation, the GW Investment Institute proudly announces the GW Stock Pitch Awards recipients for the second semester. This grant supports our mission of providing experiential investment education by enabling us to recognize and reward excellence in financial research.

We are overjoyed to present financial rewards to the top three pitches: Laura Null, whose pitch was a testament to her meticulous research and analytical skills, receiving $600; Pavan Patel, whose innovative approach and strategic thinking earned him $400; and Andrew Hasson, whose comprehensive understanding and clear presentation style merited him $250. We congratulate Laura, Pavan, and Andrew for their outstanding achievements! Their pitches, among 17 presentations during our Spring 2024 Stock Pitch Day, not only demonstrated our students’ exceptional talent but also their unwavering commitment to our Applied Financial Securities Analysis class. We are immensely proud of their accomplishments and deeply grateful to the Charles Schwab Foundation for their continuous support in fostering excellence within our institute.

On May 2, 2024, the GW Investment Institute awarded $5,000 each to our top 10 performing students, selected from the 101 students across our five finance classes from this past academic year. These exceptional individuals are now distinguished as GW Ramsey Scholars and have joined 50 other GW alumni with this designation. Including this year’s cohort, GWII has awarded $300,000 to 60 GW Ramsey Scholars in total.

Thanks to the generous contribution of $1 million from Russ and Norma Ramsey in 2005, the GW Ramsey Student Investment Fund (GW RSIF) came to fruition. Managed by GW graduate students, this fund supports the GW Ramsey Scholars program through a portion of its endowment payout. Russ and Norma’s unwavering commitment ensures our scholars’ continued success and growth, guiding them toward promising careers in finance.

2024 GW Ramsey Scholars:

• Arian Agadi, B.S. Finance
• Charlotte Bell, B.S. Finance
• Richelle Charisse, B.S. Business
• Serena Colyer, B.S. Finance & International Affairs
• Elizabeth Ellis, B.S. Applied Mathematics & Finance
• Gabriela Giraldo, B.S. Business
• Nathan Nguyen, B.S. Business
• Laura Null, B.S. Finance
• Kai Pourzanjani, B.S. Finance & Business Analytics
• Yaseen Shah, B.S. Finance  

Check out the video (created by Willow Newcomb) for more info:

Last weekend, students in Prof. Song’s Applied Financial Securities Analysis (FINA 4101) class pitched their buy and sell stock recommendations for the GW Phillips Student Investment Fund. The fund was launched in 2008 and currently has over $2.9 million in assets under management (as of 4/29/2024). Check out the most recent GWII Quarterly Report for details on the fund’s performance. 

Stock Pitch Day, a significant event in Prof. Song’s Applied Financial Securities Analysis (FINA 4101) class, saw each student applying the collective knowledge they gained throughout the semester to develop an investment pitch. They utilized the GW Investment Institute Framework of BMPB: Business, Management, Price/Valuation, and Balance Sheet. After each student presented their pitch, the investment committee (the other students in the class) voted on their recommendation. To have their recommendation accepted to the portfolio, students needed to convince at least 80% of the investment committee members. 

Here is a summary from the GW Phillips Stock Pitch Days:

• 17 student pitches
• 5 student pitches accepted for investment or 4.3% 
• 3 existing positions were increased
• 2 new positions have been added to the fund

Number of pitches by sector:

• 5 in Industrials & Materials
• 4 in Consumer, Discretionary, and Staples
• 4 in Tech & Telecom
• 3 in Healthcare
• 1 in Financial Services

Number of trades by sector:

• 2 in Industrials & Materials
• 1 in Consumer, Discretionary, and Staples
• 1 in Tech & Telecom
• 1 in Healthcare

Thank you to all of the students for their hard work and dedication. A special thank you to our teaching assistant, Will Ahrens, and the three alumni speakers who spoke to our class. 

Professors Song and Lake look forward to each teaching a section of the FINA 4101 class in the Fall semester of 2024.

Introduction

During the quarter that ended on March 31, 2024, the GW Investment Institute (GWII) hosted ten industry professionals across two finance classes. GWII launched the Quantitative Investing Project, with 13 students working to create a Python model that applied the GWII Framework. At the GWII 2024 Annual Conference, we connected over 60 students, faculty, and alumni with industry professionals to discuss the intersection of finance and artificial intelligence (AI). The following commentary was written by Laura Null, a GWSB junior graduating in 2025 with a major in Finance.

Market Commentary

Prepared by Laura Null, GW ’25

The first quarter of 2024 was marked by heightened anticipation of a recessionary downturn and interest rate cuts from the Federal Reserve. However, a stronger-than-anticipated economic performance, a steady 1.6% GDP growth rate, and persistent inflation have delayed rate cuts until an anticipated hawkish pivot in June at the earliest. Further, weakened bond market yields propelled the bullish trajectory of the U.S. Equities despite diminished global economic activity. 

The first quarter of 2024 demonstrated solid economic growth, with notable performances from Energy (13.6%) and Technology (8.5%), primarily driven by optimism around the AI revolution. Additionally, a drastic increase in demand for data centers drove demand for electricity and NVIDIA’s spotlight 19.0% Q1 revenue growth. The anticipated lower interest rate environment provided significant tailwinds for Financial Services (12.5%), which is expected to continue throughout the year. Other notable performances include Communication Services (12.8%), Industrials (11.0%), Materials (9.1%), Health Care (8.9%), Consumer Staples (6.9%), and Utilities (4.6%). Real Estate was the only sector in the red, undermined by the weakened bond market and the aforementioned outlook for rate cuts.

The performance of the GWII Student Investment Funds in Q1 2024 was 15.0%, outperforming the benchmark by 4.4%. This growth was led primarily by the GW Ramsey Fund, which delivered 18.2%, outperforming the S&P 500 Index by 7.6%. The GW Phillips Fund and GW Quant Fund delivered 10.3% and 9.7%, respectively, modestly underperforming the S&P 500 Index return of 10.6% for Q1. The GW Real Estate Fund was down -2.6%, which is in line with macroeconomic trends for that sector.

We invite you to review the full report below:

During the spring semester, the GW Investment Institute launched the Quantitative Investment Project, which challenged students to quantify GWII’s Business, Management, Price/Valuation, and Balance Sheet (BMPB) framework.

For this project, 13 students worked in four teams to develop a Python-based quantitative investment model and derive insight into the GW Quant Investment Fund’s current and potential holdings. 

On April 25, 2024, teams presented their findings and shared feedback and recommendations for the project’s next version.

Here is what students said about the project:

Thank you to our students for their hard work and dedication. We look forward to continuing the project in the fall semester.