The Henry Fund is pleased to welcome John Culley, CFA to our advisory board. John is a small-cap equity analyst with the State of Wisconsin Investment Board (SWIB) in Madison, WI, which has actively recruited students from the Henry Fund program. John was a member of the 2009 Henry Fund research team and graduated from the Tippie MBA program in 2010. As an MBA student, John also served as the teaching assistant for the Krause Fund program. Prior to enrolling at Tippie, he worked as a grain merchandiser with Archer Daniels Midland. John also holds a Bachelor’s degree in economics form Kansas State University. We look forward to having John on our board.
Portfolios Rebalanced
Last week, the Henry Fund and Krause Fund teams completed their end-of-the-semester trades and portfolio rebalancing. The updated spreadsheet portfolios for both funds are now available on each fund’s website.
Henry Fund Analysts Present Spring Semester Research
The 2013 Henry Fund research team will deliver their spring semester research to the Fund’s investment advisory board Friday, May 3rd, in S401 PBB from 10:00 a.m. – 3:00 p.m. The presentation schedule includes 22 current and potential companies that were covered this semester. Members of the Tippie community are welcome to attend any portion of the presentations.
Spring Henry Fund and Krause Fund Research
The Henry Fund and Krause Fund analysts have released their spring 2013 investment research, covering current and potential fund holdings. The latest research reports, which analyze 46 companies, are now available on the each fund’s website.
The NIT at MSG in NYC
Last Thursday, I had the opportunity to make a whirlwind trip to New York City to watch the Hawkeyes play in the men’s NIT Basketball Championship at Madison Square Garden. Since my trip was a last minute decision, this was the perfect opportunity to utilize some of my frequent flyer miles. The plan was to fly out of Cedar Rapids early Thursday morning, arrive in NYC early afternoon, tour lower Manhattan for a few hours, then meet with a group of 12-15 former Henry Fund, Krause Fund, and Tippie students for dinner and the big game. I would return home early Friday morning.
My day had a bit of an auspicious start. I arrived at the airport to check in at 5:30 a.m., only to discover that my itinerary had mysteriously been “cancelled.” Fortunately, I was able to quickly book another ticket on a later flight, but I would end up spending almost five hours at the Cedar Rapids airport before departure. This allowed me to grade a few Henry Fund reports and take a short nap.
Upon arrival in New York at LGA, I hailed a taxi to the 9/11 Memorial in lower Manhattan. Now, I am not very good at riding in the backseat, and this particular taxi driver seemed to enjoy using his brakes even when it was not necessary. About 15 minutes into my 45 minute ride, I was not feeling so well. Rolling down the window for fresh air was of limited help. I eventually asked the driver if he had a bag. This proved a wise decision. The rest of the ride was a bit of a blur. Let’s just say that this taxi driver earned a large tip for having that now full plastic bag in his cab.
The 9/11 Memorial was worth the trip. It has been almost 15 years since my last visit to NYC. The area around ground zero has obviously changed dramatically, but it was great to see the new World Trade Center building almost complete. After clearing security, I took a somber walk around the North and South Pool memorials.
North Pool of 9-11 Memorial
Because of my delayed flight, I ended up with less time for sight seeing. Yet, any self-respecting finance geek has to make a quick pilgrimage to see the “Charging Bull” sculpture on Broadway as well as the New York Stock Exchange.
After a short walk, I met fellow KnightHawk, Todd Nelson, CFA, at Goldman Sachs. Todd was a member of the 2006 Henry Fund research team and now serves on the Henry Fund advisory board. He currently works at Goldman as a V.P. in the Debt Capital Markets group. I was able to get a quick tour of his trading floor, which was still a bustle of activity late in the afternoon. It was here that I briefly caught up with Tippie alum Sandra (Pfeiler) Davis, a member of the 2003 Krause Fund research team. Sandy has been a great supporter of Tippie over the years, frequently returning to campus to help with Goldman’s recruitment efforts.
The Knighthawk with Sandra (Pfeiler) Davis at Goldman Sachs
Before leaving Goldman, we visited the building’s observation deck to see the Manhattan skyline as the sun was setting. It was a great view from the top floor.
Looking North Toward the Empire State Building
We joined a group of 12-13 Tippie alums for dinner at Brother Jimmy’s BBQ across from Madison Square Garden before the game. It turned out to be a popular location for Hawkeye fans, as we represented almost half of the customers on the restaurant’s second floor. It was great to see so many former Henry Fund and Krause Fund students.
Although the outcome of Thursday night’s game itself was disappointing, it was still fun to gather with friends and cheer until we were hoarse. Iowa fans easily outnumbered the Baylor fans by at least 3-to-1. At halftime, I was surprised to bump into Henry Fund (’09) and Tippie MBA (’10) alum, Carl Schumacher and his wife. Carl is working his way up the corporate ladder at Johnson & Johnson in NY. The Tippie alums gathered after the final buzzer for a group photo before saying our goodbyes.
We were still all smiles even after the game.
First Row: Kristen Horan, Shannan Schoening (future Hawk), Amanda Mahoski (KF ’06), Mat Sawin (KF ’06), Joe Petit. Middle Row: Mary Horan McBride (KF ’06), Devon Jarvis (KF ’09), the Knighthawk (HF ’94), Todd Nelson (HF ’06, MBA ’07), Brian Douglas (HF ’07, MBA ’08). Back Row: Ryan McBride (KF ’06), Kara Westercamp (KF ’05), Scott Delgado (KF ’02), Patrick Cornally (KF ’10), Paul Dexter (KF ’03). Not Pictured: Kevin Hansen, David Fulcher (KF ’10), Brett Koch.
I managed to secure a couch to surf for the night at the KnightHawk east-coast corporate headquarters. With a peaceful three hours of sleep, I caught a cab back to LGA for my early morning flight home. My 14 hour New York NIT experience was short, but it was exciting to gather with fellow alums to support the team. Go Hawks!
Lower Fees: No Fooling
Students who enroll in my wealth management courses likely know that I am a strong advocate for minimizing investment related fees, especially expense ratios on mutual funds. The Vanguard Group is widely known as having among the lowest expense ratios in the industry. Thus, on Monday, even though it was April Fool’s Day, I was not surprised to discover that several Vanguard international index funds had recently lowered annual fees.
While seeing your fund’s expense ratio fall by 0.02% may not seem like a large amount, it does represent a reduction of 10.0-14.3% across these three funds. Keeping costs low will result in more money in the account for investors.
Magic Number: 162
Last night’s game between the Houston Astros and the Texas Rangers officially kicked off the start of the 2013 Major League Baseball season. The last couple of seasons have been tough for fans of the Minnesota Twins, but opening day always brings a sense of optimism. Today, the Twins’ magic number stands at just 162.
The 2013 season will be even more exciting as the Cedar Rapids Kernels take over as the Class A affiliate of the Twins. It will be great to see the future stars and top prospects pass through Cedar Rapids on their way to Target Field in Minneapolis.
An Irish Economics Lesson
Our taxi driver from the Dublin airport on Friday talked about the impact of the economic recession that Ireland has faced since the 2008-2009 financial crisis. The “Celtic Tiger” was one of the strongest economies of the Eurozone over the decade leading up to the crisis, so not surprisingly, it was hit especially hard by the downturn.
Although one certainly would not have noticed a decline in economic activity in Dublin over St. Patrick’s Day weekend, we did stumble upon a couple of indicators during our exploration of the city yesterday. First, I noticed the following sign outside one gate to the Department of the Taoiseach building, which is the government department of the Irish prime minister. I was not sure whether to take this sign as a positive or negative indicator of the economy. I guess depends on your views of the role of government in the health of an economy.
A Sign Outside of Ireland's Department of Taoiseach (Prime Minister).
Later in the afternoon, we walked past the front entrance of the same building, where a group of approximately 200 protesters had gathered. There was a strong Garda (police) presence keeping peace, while a handful of counter-protesters utilized the other side of the street. From what I could gather, the group was upset about local government debt levels. Their slogans, chants and signs suggested the larger group was in favor of a default some of the debt and a desire to punish bond holders. That is certainly one way out of a debt crisis, but the long-term consequences it would bring may prove a more challenging pill to swallow. I wanted to stop and listen to their speeches, but apparently, the rest of my family was less interested in the protest.
St. Paddy’s Day in Dublin
Today, I celebrated St. Patrick’s Day where the tradition began, in Dublin, Ireland. We were greeted by traditional Irish weather this morning with steady rain. It would not dampen our spirits though, as we began the day with a tour of the Guinness Storehouse, the perfect family outing.
Father-Son Bonding Time
Arthur Guinness started brewing ales in 1759 at the St. James’s Gate Brewery in Dublin. He was apparently a very optimistic entrepreneur, as he signed a 9,000 year lease for £45 per year for an unused brewery. Calculating the present value (or future value) of this contract seems like a great introductory finance question.
After our tour, the rains let up just long enough for Dublin’s St. Patrick’s Day Parade. Large festive crowds lined the nearly 2-mile long route. The U.S.A. was well-represented in the parade with numerous high school and university marching bands, which seemed to be a favorite among the crowd.
The stars and stripes were well represented in Dublin today.
Henry Fund Tops $3.0 million
This afternoon, the Henry Fund portfolio crossed the $3,000,000 threshold in assets under management for the first time in its 19-year history. The fund began with an initial investment of $50,000 in April of 1994. Today, the fund manages a collection three separate scholarship and endowment accounts:
- MBA Student Scholarships (21.37%)
- Athletic Scholarships (40.30%)
- General Endowment Fund (38.33%)
As of 2:45 p.m. this afternoon, the 31 fund holdings were valued at $3,006,025. For the year-to-date 2013 period, the fund has earned 10.19% compared to its benchmark S&P 500 index return of 10.02%.
