Investments Committee

Nick KeithAlex Han

• On the Google Calendar, do you have access to…– Investments Committee dates– IC Mentorship Program dates

• On Google Docs, do you have access to…– GTSF-IC Weekly News– Allocations and Tasks for IC

If not, email Alex (ahan1991@gmail.com) with your Gmail email address.

New Resources

• TradeStation• Investor’s Business Daily

Newspaper and Login• StockTwits U

Agenda

• Changes in structure in IC and GTSF• Mentorship changes• Other initiatives• Strategy overview• SA/IDG responsibilities• Allocations discussion and voting

Director of Financial Programming• Work side by side with Financial Programming

representative on the Board of Trustees.• Heads up planning of all IC events:– Investments Seminar– Career Fair– Financial Literacy classes

Director of Macro Trends• Maintain a constant watch on global events and trends.• Analyze performance of sectors and specific industries

within the sectors.• Monthly presentations on current performance and

future outlook of overall market and specific sectors.• Works closely with Sector Analysts.

Website Updates

• IC Guidebook is up to date and on the blog.– Will still upload presentations to the blog.

• Emily Cardin is redesigning the entire GTSF site.– Working with her to determine what changes will be

made. After the updates, we will decide to stay with GTSF or get our own domain.

Mentorship• Will scrap the “SHAFT” in place of a test that will more closely reflect information given

in Mentorship• Planning to start on Tuesday September 4th

– The test (yet to be named) will take place on Tuesday September 25th

– 6 sessions in total– Less power point and more analyst lead small groups

• Limiting the number of students that are accepted in– We can accept “general members”, but only 2-3 mentees per sector will be given the Analyst

title– Promotes exclusivity while still allowing people to learn about investing– Helps us seem more legitimate when asking companies to come to career fairs where IC

members will be present• One presentation on Professionalism, Public Speaking• Better new member database• For current IC members/general members, sign ins for the first two weeks will be

grandfathered in (don’t have to take the new test)• Tuesday/Thursday 6:00-7:00pm in room 200 of CoB

Switch to Online Broker

• We are switching to Fidelity (~$10/transaction)– We were paying $100 per transaction with UBS

• Geoffrey and Patrick are hammering out the details with Fidelity

• Save $1000+ a year

Strategy Review

What Is Sector Rotation?

Sector Rotation - A portfolio manager's attempt to profit through timing a particular economic cycle.

Constantly trying to identify where we are in the economic cycle and invest upon that. The best way to identify where we are is by looking at was is currently outperforming and underperforming.

How to make it our own?• Moving to sectors that are working.• Allocations will be based on those observations.• Time frames of 6 months to 3 years.• Looking for steady trends higher.• Best picks are usually leaders in their sectors.• Solid moving fundamentals, growth oriented, less

emphasis on P/E ratios.• Strict selling rules.

Specific strategy for each sector will be determined on an individual basis.

Strategy Changes• Not a pure sector rotation strategy

– We will still determine what sectors are “working” when deciding on allocations

• Decide strategies for each sector individually– Fundamental, value, growth– Which industries to shy away from, which to get into– IDG Vote for individual sector strategy with input from SA

• IDG will release guidelines within the first week of each month reiterating or changing the individual sector strategies

• Still maintaining the minimum equity allocation % for each sector for diversification purposes

When To Buy• Look for outperforming sectors relative to overall

market• Look at the stocks in sector that are outperforming

based on recommended strategy• Fantastic balance sheet• Increasing Earnings• Strong leadership & growth goals

Selling Rules• 10% BTD loss: SA is notified to keep stock on watch• 15% BTD loss: Requires immediate stock reevaluation– Stock evaluation would be short and be presented ASAP

(sent over email if needed)– No lengthy pages of numbers, just a short presentation

covering performance of stock versus the sector and market.• Only want to see numbers if earnings were recently

released or any other major fundamental news• Want a simple ‘Hold’ or ‘Sell’ from the SA

When To Sell• Overview– If a SA recommends to sell a stock after a re-evaluation,

then IDG will have a vote as normal.– If a SA recommends to hold a stock, a motion will be held

to see if IDG wants to vote for a sell.

• Taking Gains– Every time a stocks has gained 15% to 20% in profits, it will

be lowered back to allocation.

IDG/SA Overseer• Each IDG member will be assigned to a pair of SA’s.

They will be actively involved in assisting the SA in making presentations, starting discussions, etc.

• SA’s will have a small team of analysts, but general members may be contacted for additional help.

• SA’s will work with Tony to provide updates of events and performance in their sectors (kind of like an aggregation of the weekly news).

• SA’s must send all presentations/re-evals/sector updates to Peter for the website.

• Overall Allocations• Equity Allocations– Discuss what the markets have been doing.– Analyze what sectors of the markets ARE working and

AREN’T working (Tony and SA’s).• Looking for trends and recent events.

• Must be at least a 3% allocation in every sector.• No upper limit to the allocation of a specific sector.

Allocations