The Business School is offering a new course in the investment track that provides students with the opportunity to invest money in hedge funds.
The new course, which began this semester, will teach students how to operate a hedge fund by compiling market research and investing in real stocks. The students have $100,000 to invest as they see fit, thanks to a donation from an anonymous alumnus. Any profits or losses will only affect the fund, protecting the students from having to reimburse Ithaca College, Mary Ellen Zuckerman, dean of the School of Business, said.
A hedge fund is a type of private investment fund that has diverse assets overseen by an investment manager who typically invests his own money into the fund, senior Omar Zafar, who is taking Hedge Fund I, said.
The class gives students a look into the world of finance by offering them access to real money and professional software, Zuckerman said. The college also provides students with real time stock tickers and Bloomberg terminals, which display market data and trends, in the Trading Room inside the School of Business.
“Most undergraduate business schools don’t have this course,” Zuckerman said.
One of the prerequisites for the Hedge Fund course is Real Time Portfolio Management, in which students manage a mutual fund. Last year, the students had $130,000 to invest. The class made students familiar with investing real money, even before taking Hedge Fund I, senior Mark Rudovic, another student currently taking the course, said.
“We had about $130,000 when we came into [Real Time Portfolio Management] in August 2012, and we left off close to $140,000,” Rudovic said. “So managing money is nothing new to us. What’s interesting is learning the techniques of a hedge fund.”
Hedge funds are more complex than mutual funds and allow students to use new strategies they didn’t explore in Real Time Portfolio Management, Zafar said.
“The Hedge Fund course interested me because we can do different practices, where we can do shorter stocks, we can do different types of strategies other than just investing in loan-only equities,” Zafar said. “[Hedge funds] can use weird investing strategies that we’re not too familiar with when compared to Real Time Portfolio Management, which is structured as a mutual fund.”
The course has been developing for more than a year, Zuckerman said, ever since the Investment Advisory Board knew they would be receiving a donation of $100,000 from an anonymous alumnus that would help fund the Hedge Fund course. The Investment Advisor Board is made up of alumni who advise investment courses, some business and finance faculty, Zuckerman and Associate Dean Barbara Howard.
Bob Andolina, a senior lecturer at Cornell University, is currently teaching the Hedge Fund course at the college. Andolina spent 19 years in the equities industry and worked for Lehman Brothers from 2000 to 2005. His class feels like an office environment instead of just a lecture hall, Rudovic said.
“It’s a reflection of how much people enjoy learning about this stuff and how much Professor Andolina has opened up our minds and helped us think through investing and finance in general,” Rudovic said.
Rudovic and Zafar both strongly recommend business and economics majors to take the Hedge Fund course.
“I think everybody in my class could tell you if everybody was right, everybody would be rich. If there was one structured way to invest money, everybody would be rich, but that’s not the case,” Rudovic said. “It’s an art, not a science.”