GW INVESTMENT INSTITUTE INSIGHTS

We just completed the first week of the 2022 fall semester at the GW Investment Institute (GWII). I really enjoyed meeting our students in class and learning more about their interests and what they hope to learn. Along with Professors Matt Miller and Bill Collier, GWII is running five finance classes this semester, four of the five are associated with a Student Investment Fund (SIF). As of today, our students are managing approximately $6.6 million of GW’s endowment funds.

Please save the dates for fall 2022 GW Stock Pitch Days. Over 65 students will present their buy and sell investment recommendations. These days are truly the highlight of our semester. We would love for you to join via Zoom!

Here is the schedule:

• GW Real Estate SIF – Tuesday, December 6^th at 12:45 p.m. EST
• GW Real Estate SIF – Friday, December 9^th at 9:00 a.m. EST
• GW Phillips SIF – Saturday, December 10^th at 9:00 a.m. EST
• GW Ramsey SIF – Sunday, December 11^th at 10:00 a.m. EST
• GW Phillips SIF – Friday, December 16^th at 9:00 a.m. EST

I look forward to the rest of the semester and continue to be grateful for your support. It is only with your continuous commitment and contributions that we get to teach students how to invest through experiential learning. 

Best regards, 

Rodney E. Lake

Director, GW Investment Institute

Full report: GWII 2022 Annual Report

I present to you the GW Investment Institute’s fiscal year 2022 annual report in which we reflect upon a remarkable academic year and highlight some of our accomplishments. Along with Professors Matt Miller and Bill Collier, we taught seven finance classes as part of the GW Investment Institute (GWII) and hosted over 30 industry professionals in-person and virtually. We also launched the GW Quantitative Student Investment Fund, awarded $50,000 in financial awards to our top 10 performing students, and established an endowed scholarship to support women in investing. 

Thank you to our students, professors, staff, teaching assistants, advisory and governing board members, portfolio advisors, and guest speakers for going above and beyond to help advance our mission of excellence in experiential investment education.

Our accomplishments, as well as GWII’s Student Investment Funds performance are a direct result of the hard work and dedication of ~1,200 alumni, faculty, and staff. On behalf of the GW Investment Institute, thank you for your continuous support and engagement. I’m excited for the future of GWII and look forward to growing the institute with your help. 

Sincerely, 

Rodney E. Lake
Director, GW Investment Institute

A following guest blog post is written by William Ahrens, a sophomore at George Washington University (GW) working towards his Bachelor’s of Science in Finance. William is the second GW School of Business student to intern with a startup company as part of the newly launched Venture Capital Internship Program (VCIP).

When I was selected to take part in the Venture Capital Internship Program, I was given a venture placement opportunity through a GW Investment Institute board member, David Asper. Mr. Asper is the Principal/GM of Asper Group LLC, a pre-seed/seed investor. He arranged an introduction to a co-investor in one of his portfolio companies at WXR Fund. Here I was offered an intern role at a fledgling startup in the WXR portfolio. I was enthused to intern at inCitu, a social impact startup fundamentally changing the way populations interact with urban development by putting the future in the fingertips of society through augmented reality. inCitu’s mission is simple and appealing: a city is shaped by the community of people who exist in it, requiring a need for democracy and inclusivity in the urban design process.

I met with the Founder and CEO of inCitu, Ms. Dana Chermesh-Reshef, who offered me an opportunity to further my programming abilities and tackle projects and problems relating to data extraction and analysis. Throughout the summer, I took on projects ranging from extracting data from a wide variety of New York City government sources to blueprinting a relational database for internal business use. Ms. Chermesh-Reshef created an exciting learning environment that allowed me to take on programming challenges I feel passionate about while better refining my skills and abilities.

At inCitu, I worked closely alongside the Head of Product, Mr. Tyce Herrman. Admittedly, I was a bit uneasy when Mr. Herrman first introduced his desire for me to create an internal database of New York City’s urban planning data; however, it presented me with a chance to learn a new programming language. This work formed the cornerstone of my summer and further refined my views of how challenges can become great opportunities.

My experience at inCitu has solidified my desire to work in a fast-paced environment where every task, regardless of how simple or sophisticated, contributes meaningfully to the broader vision and goal of the company — this is especially true at a startup. The sense of accomplishment and exposure to a variety of challenges and opportunities has been a rewarding and defining experience. This fall semester, I’ll continue working at inCitu and in a new product and business development role.

I am grateful to Mr. David Asper for enabling this experience and his continued support of the Investment Institute. Similarly, thank you to the Investment Institute for granting me and other students the opportunity to take part in a program that further supports classroom learning.

To learn more about inCitu, please visit the following social media:

LinkedIn: https://www.linkedin.com/company/incitu-ar/

Facebook: https://www.facebook.com/inCituAR/

Instagram: @incitu_ar

Full Report: GWII Quarterly Report June 2022

Market commentary

Financial markets sharply declined as investors grappled with surging inflation, the actions of the U.S. Federal Reserve (the Fed), and a global economic slowdown throughout the quarter ended June 30, 2022. Inflation spiked to a staggering 9.1% year-over-year reading in June, the highest in over 40 years. Ongoing conflict in Ukraine, which has upended global
commodity markets and supply chains, contributed to the heightened food and gas prices. To combat inflation, the Fed raised interest rates 75 basis points in June, the largest hike since 1994. Equity markets responded poorly to the state of developments, and firmly entered into bear territory. While all sectors in the S&P 500 lost value, the declines were most significant in consumer discretionary, communication services, and information technology, and least pronounced in the energy, utilities, and consumer staples sectors.

For the quarter ended June 30, 2022 the GW Investment Institute Student Investment Funds in aggregate underperformed the benchmark with a return of -18.0% vs. -16.1% for the S&P 500, while slightly outperforming the benchmark in the calendar year-to-date -19.9% vs. -20.0% for the S&P 500. The long-term aggregate fund performance is a testament to the enduring diligence and commitment of our students, faculty, and alumni.

Samir Iqbal, Portfolio analyst, GW Phillips Student Investment Fund

Mr. Ramsey is the chair of the Governing Board for the George Washington University Investment Institute and the chairman emeritus of the GW’s Board of Trustees. In his commencement speech to GWSB class of 2022 graduates he advises them to:

1. Be bold and have big audacious goals. 

2. Don’t run from failure. Learn from it and never give up. 

3. Find mentors.

Watch the full video at GWSB YouTube channel:

Full Report: GWII Quarterly Report March 2022

Market commentary

The first quarter of 2022 saw financial markets plagued by volatility, caused first by the fast-spreading Omicron variant of the COVID-19 virus, and then by Russia’s unprovoked invasion of Ukraine. Throughout the quarter, the anticipation and implementation of interest rate hikes – as well as continued record-high inflation readings – did not help to ease the pain. The VIX, an index that measures volatility in financial markets, reached its highest level this quarter since January 2021. The Dow Jones Industrial Average recorded its largest-ever daily point gain in late February, after falling 4.5% during one week in January.

The S&P 500 Index was largely kept afloat by the Energy sector, which returned 33.5% during the quarter. Technology companies were hit hard during the quarter, with Meta Platforms (formerly Facebook), a GW Phillips Student Fund holding, falling over 25% in one day this February.

For the GW Investment Institute Student Investment Funds (GWII SIFs), returns during the first quarter were -4.0%, outperforming the S&P 500 Index, which returned -4.6%. The success of the GWII SIFs is a direct result of the continued hard work of students, faculty, staff, and alumni. 

Andrew Salm, Portfolio analyst, GW Phillips Student Investment Fund

The GW Quant Student Investment Fund is the newest fund of the GW Investment Institute (GWII) launched in December of 2021.

The finance industry has experienced large changes due to technological innovations, for example the increase in quantitative strategies. This course provides an overview of some common quant investing strategies and focuses on data-driven models, which is different from the fundamental analysis and subjective assessments which are the focus of the other GWII student funds. Students learn how to analyze time-series data and work in groups to find and analyze real data and build and test a predictive model. 

Below is a short summary of the 8 final projects for the GW Quant Student Investment Fund for Spring 2022. 

Foggy Fund: Used a three-factor model and tracked its momentum via an RSI indicator to understand which areas of the tech sector are performing best and tailor an investment strategy accordingly. 

Quant Queens: Investigated the perceived information advantage of members of Congress to see if using their stock trades and other criteria about the members could outperform the market. 

Steeling Alpha: Developed a model to predict the price of American steel producing companies. 

Dividend Factor Model: Developed a multi-factor model to see whether dividend-paying stocks could outperform with lower volatility. 

Quantify the Fundamental Elements: Used an F-score model for the company fundamentals and then selected companies with highest momentum

Quant Squad Capital: Investigated event-driven trading for sports betting companies around big sporting events. 

Axe Capital: Focused on momentum trading and developed a model based on exponential moving averages.

The E Screen: Interested in whether environmental performance (operationalized as a company’s reduction in greenhouse gas emissions) helped predict stock price. 

Given that the teams only had one semester to learn about quant investing and develop models they all had recommendations for future research, such as: including other variables, examining other time frames, gaining a better understanding of entry and exit points or position sizing, and examining the effect of more frequent trading.

Thanks to all the students for their hard work during the semester. 

Rodney Lake

Market News with Rodney Lake is a monthly show to discuss key investing concepts and items in the news.

Pricing power is a measure of how much a change in the price of a product will affect the quantity demanded. Investors care about this concept because it shows the extent to which companies can pass costs to customers without harming their sales or margins. 

In this program, Rodney Lake, Director of the GW Investment Institute, discusses: when companies have pricing power, why it’s particularly important in the current economic environment, and a few examples from recent earnings reports.