To David Bailey, the pain that comes with losing money is one of the best things about the Culverhouse Investment Management Group.
CIMG is a select group of undergraduate students that manages an investment portfolio that is currently worth around $350,000. Students make real market decisions for this fund, and as Bailey, CIMG’s vice president of public relations, said, “losing money is such a valuable experience.”
“I’ve seen the realities and felt the pain,” Bailey said. “There is a real pain that comes with losing real money.”
While CIMG has had its share of losses, the group has posted some impressive returns overall.
At the end of the second quarter of 2011, CIMG’s portfolio stood at $391,498.97; up 24.29 percent since the group’s inception in 2009.
Those gains have since been reduced, but the group is still up almost 10 percent since inception.
“Currently all money stays in the fund,” said Rob Norwood, CIMG president. “In the future, the hope is that it will eventually fund scholarships for students throughout the University.”
Though many CIMG students are business students, the program is open to all students. The group invests in a variety of sectors, and this variety calls for a variety of students.
“It is a unique program,” Bailey said. “We have people who aren’t finance people. For example, we look for biology majors for healthcare investments.”
Norwood said the process of choosing stocks is not a short one.
“It is a very intensive process,” Norwood said. “Some guys will sit and look at a pick for two months before they finally pitch it.”
Bailey said the knowledge gained from the program is worth the time and hard work put in.
“Learning how to value something, whether it be an equity or some other financial instrument, or simply a car or a house is a very important skill,” Bailey said. “Our members learn how to do that.”
Norwood agreed that CIMG is a good learning experience.
“As far as what it has taught me, the question would be what hasn’t it taught me?” Norwood said.
The skills learned from this program are reflected in the high job placement rates of CIMG members. Members have been placed at JP Morgan, BBVA Compass and Ernst and Young, among others.
Norwood said CIMG was a great help in the pursuit of a job in the investment industry.
“For my career there is really nothing I could have done better than CIMG,” Norwood said. “It is exactly what a student at Alabama interested in the investment industry should do.”
Bailey said even with the sting of losing, he likes the risky game of investment.
“They said it never feels as good to win and it hurts to lose, and that’s probably true,” Bailey said. “But I like the risk.”
For more information on CIMG and how to get involved, visit their website at cba.ua.edu/cimg.
