Bulls, bears and Tigers
Student investing group takes stock of financial future
Mizzou students Tracy Qin (left), Luke Besser and Colin Livasy founded the University of Missouri Investment Group, a student organization in which members practice trading on the stock market.
During Summer Welcome Luke Besser received some advice that helped shape his first year at Mizzou.
Jim Spain, MU’s vice provost for undergraduate studies, urged Besser and fellow incoming new students to take full advantage of their time at Mizzou by getting involved in activities outside the classroom.
“He said that what you make of your experiences is up to you,” Besser explains. “He encouraged everyone to create their own experiences while in college.”
Besser has spent his first eight months at MU doing just that.
Having dabbled in the stock market while in high school, Besser went in search of an investing group when he arrived at Mizzou. He didn't find one. So, taking Spain’s advice, he created one.
Besser visited the Student Involvement Office, where he learned that Colin Livasy, a junior from Kansas City, and Tracy Qin, a sophomore from Wildwood, Mo., also had expressed interest in an investing group.
Together the three formed the University of Missouri Investment Group (UMIG).
“We wanted to allow students all over campus, regardless of previous education or major, to learn how to invest and trade for the future,” Livasy says.
UMIG created an opportunity for students at all levels of stock-market savviness to learn and share ideas with peers also interested in investing.
“Being financially literate and knowing financial markets is crucial to everyone's financial stability, not solely business majors,” Qin says.
While many of the club’s members have their own actual investment portfolios, UMIG has a “paper-trading” portfolio that allows investors to practice trading without using real money.
The group started trading in November, and its portfolio had grown by 55 percent by the end of December. It was up 75 percent by the middle of January and 106 percent by the end of March.
“We jumped right in,” Besser says. “We had some loses along the way, as always, but we tried to get out as fast as we could and reposition ourselves to get stocks that have the most growth.”
Though the stock market was unstable when the students first entered, the group saw a hefty return in its investments.
“We would wait for a day when the stocks were down and then we would start buying,” Besser says. “Because the market was so unstable, we had a lot of opportunities to get in at a low price.”
Since the start of 2012, the stock market has seen a steady rise, and some smart decisions by the UMIG have enabled the club to take advantage the change.
“The success of the portfolio is one of our main goals,” Livasy says. “We use that to show that we have effective portfolio management skills and good feedback for additions from group members.”
Making a pitch
At their weekly meetings, members make stock pitches about new companies and have an open discussion about the group’s portfolio. The involvement of all of the group’s members has become a key part of its success.
“I’m excited to see our members beginning to pitch stocks,” Qin says. “Since we encourage students of all educational backgrounds to join, we are able to develop a portfolio that is very diversified, which I believe is part of the reason we have seen such exponential growth over this past semester.”
The group continues to grow, and participation among the members has increased.
“People have gone from just sitting and listening when the club started to being very involved,” Besser says. “More students are making pitches each week, and their proposals are being added to our portfolio.”
Stocks are added only after being evaluated by the group and voted on by the members. The diversity of the group has been beneficial in many ways. For example, one member, a biochemistry major, shared his knowledge of biotech stocks.
“If we didn't have an open membership policy,” Qin says, “we would not know all of the specializations of many of these biotech companies.”
From Mizzou to Wall Street
In addition to operating a group portfolio, the UMIG serves as a learning opportunity and gives students a forum to discuss investments.
“We believe we give a comprehensive and broad education about how to invest effectively,” Livasy says. “Generally, when someone comes to one meeting they stay active with the group if they are genuinely interested in investments."
Creating an experience is what the UMIG is about. The club hopes to serve as a networking tool for its members and has reached out to major financial firms to share ideas. The group has also been in contact with the Chicago Board of Trade, which hires several college interns each summer.
“By sending our portfolio to these financial companies, we are able to show that we have real ideas,” Besser says.
Many of the UMIG members have aspirations of someday working on Wall Street, while others just enjoy the chance to try out the stock market while pursuing degrees and careers in other fields.
For now UMIG is creating opportunities for new experiences beyond campus. The group is in the midst of a fundraising campaign with a goal of raising $10,000 that would fund trips to the New York Stock Exchange or the Chicago Board of Trade.