Our Investment Strategy

See how we hope to live up to our mission and vision. 

• Investment Strategy

  The Auburn Student Investment Fund has structured its portfolio around a core-satellite investment strategy, in which our sectors seek to add positions that are forecasted to mitigate risks or increase the overall return of the portfolio. By holding the S&P 500 Index as the primary position, the fund is able to reduce unsystematic risks that may otherwise threaten traditional portfolios. Sector teams focus on identifying securities which the fund should reinforce either under the pre-existing positions, or through a newly-introduced position. Each satellite position undergoes extensive due diligence before capital is allocated. Such due diligence includes: best-alternative screening, detailed equity research reports, forecast and valuation models, general fund consideration, and finally, approval from leadership. 

  Protection of capital is the primary objective of the fund, followed by a satisfactory return against the benchmark. Risks are continuously filtered during the sector due-diligence process and are highlighted during presentations. The Fund's leadership includes a position solely dedicated to evaluating risks throughout the portfolio and analyzing pitched securities for red flags. Through the emphasis on risk during the selection process, the skepticism of all reasoning, and the nature of the portfolio's strategy itself, the Fund has been able to protect its seed capital of $250,000.

  The Auburn Student Investment Fund's approach to risk management and highly-selective adoption process have established a portfolio allocated into nineteen equities, including the core position. As of March 21, 2018 the Fund has grown AUM to $295,000, representing a 6.1% return since inception, comparable to the 6.9% return of the S&P 500 Index. 

Organization Activities

• Southeastern Hedge Fund Association Competition 

  Team members Kate Bagley, Matt Hultstrand, Haley McDonnell, Ethan Reback, and Nathan Stein created a hedge fund strategy that could be deployed with a minimum capital base of $10MM. Additional requirements stated that the strategy maintain a beta-neutral position and efficiently generate alpha. The final proposed strategy involved options trading to create combinations of long-straddles and short-strangles with individual equities in connection with perceived levels of volatility in different industries within the overall market. Members of this team put in over 150 hours each over the course of two months of research and modeling of the proposed strategy. The final product consisted of 10 pages of analysis and models detailing the strategy, trading signals, risks, and a comprehensive back-testing of the strategy on a sample portfolio. This competition challenged members to think creatively and analyze large amount of market data to look for overarching trends.

• UGA Terry College of Business Stock Pitch Competition

  Team members Emily Kravec, Matt Hultstrand, Jenny Herrell, and Gary Gray were tasked with presenting a single equity as a buy recommendation. This team chose Constellation Brands, Inc. and completed in-depth quantitative and qualitative analyses. The focuses of the qualitative analysis were the trends of company segments, strength of the financial statements, and management activity. The quantitative analysis included a Trading Comparables Analysis, Precedent Comparables Analysis, and a DCF analysis. By reviewing the target company from a holistic perspective, team members gained valuable insights about how company actions directly impact financial performance in real time. The valuation of Constellation Brands also provided the team an opportunity to practice the same skills that are used weekly as a part of the Auburn Student Investment Fund.