Fund Overview

The Henry Fund, named for its two founding benefactors, Henry Royer and Henry B. Tippie, provides select University of Iowa MBA students with a forum to blend academic rigor with real-world portfolio management experience. The fund was established with an initial investment of $50,000 in the spring of 1994.

The Henry Fund is an endowed equity portfolio required to meet the same basic performance guidelines as equity accounts in the University of Iowa’s long-term investment pool. In keeping with these objectives, fund managers seek to achieve the highest level of return while maintaining a risk profile similar to the S&P 500 index. The Henry Fund team recommends a targeted portfolio of stocks from a broad set of industries, investing in well-managed, profitable businesses without unnecessarily exposing the fund to economic or industry risks.

The Henry Fund is managed by select full-time MBA students enrolled in the Applied Securities Management course at the University of Iowa. Students apply to manage the fund at the end of the fall semester by submitting an original research report for an assigned company. Each of the chosen analysts work within one of ten economic sectors.

Fund managers develop a fully integrated investment review, based on a top-down approach incorporating an extensive economic, industry, and company-specific analysis. Once the analyst evaluates the economic and industry value drivers, he or she researches specific companies for potential investment. Securities are valued using a variety of techniques including: discounted cash flow (DCF) analysis, economic profit, fundamental multiple analysis, and relative to comparable firms.

Fund managers serve as both sector analysts and portfolio managers, providing basic industry research, proposing investment ideas, and evaluating the ideas of the other managers. Following approval by the management team, each analyst presents their investment thesis to the fund’s Investment Advisory Board.

The Henry Fund charter requires the portfolio be at least 95% invested in equities of individual companies across diversified industries. Passive holdings in exchange traded index or sector funds may be used to provide liquidity and minimize benchmark tracking error of cash holdings. Proceeds and income from the fund’s assets are distributed annually to support scholarships and other programs that benefit University of Iowa students.