mcintire investment institute at the university of virginia 2008 recap prepared by mii managers | 27...
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McIntire Investment InstituteAt the University of Virginia
2008 Recap
Prepared by MII Managers | 27 January 2009
M c I n t i r e I n v e s t m e n t I n s t i t u t e2
Agenda
• Performance review• Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e3
Agenda
• Performance review• Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e4
2008 performance• MII performance 2007: -31.5% or (-
$172,279)• MII benchmark: S&P 500: -38.5%• Spread: 7.0%
2-Jan
1-F
eb
2-M
ar
1-A
pr
1-M
ay
31-M
ay
30-Ju
n
30-Ju
l
29-A
ug
28-S
ep
28-O
ct
27-N
ov
27-D
ec
-50.0%
-40.0%
-30.0%
-20.0%
-10.0%
0.0%
10.0%
Comparative YTD Performance
M c I n t i r e I n v e s t m e n t I n s t i t u t e5
2008 Winners and Losers
• “Winners”:– Exxon Mobil: (14.8%)– Monsanto: (16.9%)– Covanta: (20.6%)
• Losers:– American Express: (46.5%)– Johnson Controls: (49.6%) – Intuitive Surgical Robots: (60.7%)
M c I n t i r e I n v e s t m e n t I n s t i t u t e6
Portfolio changes
• Closed:– Exxon Mobil: 85.6%– Nike: 16.5%– Express Scripts: 234.6%– Deere & Co: (36.7%)– Johnson Controls: 42.9%
M c I n t i r e I n v e s t m e n t I n s t i t u t e7
Portfolio changes
• Opened:– Long: Textron– Long: Google– Long: Hemisphere GPS– Short: Herbalife– Short: Corinthian Colleges
M c I n t i r e I n v e s t m e n t I n s t i t u t e8
Agenda
• Performance review• Very Expensive Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e9
Set price targets
• Intuitive Surgical Robots• Johnson Controls
• Lesson – take profits
M c I n t i r e I n v e s t m e n t I n s t i t u t e10
Intuitive Surgical Robots
M c I n t i r e I n v e s t m e n t I n s t i t u t e11
Johnson Controls
M c I n t i r e I n v e s t m e n t I n s t i t u t e12
Understand Risks – currency, inputs, etc.
• Sadia• Lesson – always consider downside
M c I n t i r e I n v e s t m e n t I n s t i t u t e13
He who picks bottom has stinky finger
• American Express• Coach
• Lesson – Ease into positions in volatile market
M c I n t i r e I n v e s t m e n t I n s t i t u t e14
American Express
M c I n t i r e I n v e s t m e n t I n s t i t u t e15
Coach
M c I n t i r e I n v e s t m e n t I n s t i t u t e16
Entry Points
• Mistake: Deere & Co.• Well-Played: Monsanto
• Lesson – use watchlist, be patient
M c I n t i r e I n v e s t m e n t I n s t i t u t e17
Mistake: Deere & Co.
M c I n t i r e I n v e s t m e n t I n s t i t u t e18
Well-Played: Monsanto
M c I n t i r e I n v e s t m e n t I n s t i t u t e19
Short!
• No short positions over summer• One short position held through fall
semester
• Lesson – long/short fund need to have short positions
M c I n t i r e I n v e s t m e n t I n s t i t u t e20
Agenda
• Performance review• Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e21
Goals for 2008
• Improved transparency between managers and members– Polling on website– Timely decisions
• Enhance educational value– Financial news in Cavalier Daily– Sector Head presentations
• Standardized Sector Head memos• Open for suggestions as always
M c I n t i r e I n v e s t m e n t I n s t i t u t e22
Goals for 2009
• Improved watchlist• Enhance educational value
– Discussion of pitches during meetings• Improve transparency
– Explanation of management decisions– Issue Semester Reports
• Continue successful efforts• Open to suggestions
M c I n t i r e I n v e s t m e n t I n s t i t u t e23
Agenda
• Performance review• Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e24
Opportunities for involvement
• Benefits of MII involvement:
– Gain real-world investing education and experience
– Platform for future management position
– Improve presentation skills– Useful for interviewing
M c I n t i r e I n v e s t m e n t I n s t i t u t e25
Opportunities for involvement
• Positions for involvement: – Long-fund manager– Short-fund manager– Sector heads– Analyst (Analyst Program)– Member
M c I n t i r e I n v e s t m e n t I n s t i t u t e26
Long-fund positions
• Five person investment committee– Make decisions for all positions in the
portfolio• Candidates are strongly encouraged
to: – Demonstrate regular involvement– Make quality investment pitches with
attention to VAR• Election
– Investment memo and brief presentation
– Dinner with managers
M c I n t i r e I n v e s t m e n t I n s t i t u t e27
Short-fund positions
• Committee that oversees the short portfolio
• Responsible for presenting attractive shorts
• Exposure to advanced investing techniques
• Candidates are strongly encouraged to: – Demonstrate regular involvement– Make quality investment pitches with
attention to VAR• Elections are held in April
M c I n t i r e I n v e s t m e n t I n s t i t u t e28
Sector Head position
• Members select one of nine sectors to cover
• Helps managers oversee portfolio and gain insight into a specific sector
• Bi-weekly updates for managers– Overview of current holdings and
potential investments• Brief overview presentations at
meetings• Contact Pete Cobos (pjc9f)
M c I n t i r e I n v e s t m e n t I n s t i t u t e29
Analysts
• Analyst– One company presentation– Team presentations are acceptable
• Senior Analyst – Two company presentations
M c I n t i r e I n v e s t m e n t I n s t i t u t e30
Analyst Program
• Analysts will be paired with a manager:– Assist with idea generation– Offer guidance for research– Provide direction for VAR– Explain the PowerPoint presentation
process– Check the presentation for
requirements• Contact Pete Cobos (pjc9f)
M c I n t i r e I n v e s t m e n t I n s t i t u t e31
Requirements for a presentation
• Business overview• Well-developed thesis points• Management overview• Investment fundamental• Competitive position in the industry• Recent news and developments• Extensive VAR• Risks• Relevant financial metrics
M c I n t i r e I n v e s t m e n t I n s t i t u t e32
Agenda
• Performance review• Lessons Learned• Goals for 2009• Opportunities for involvement• Website/Collab
M c I n t i r e I n v e s t m e n t I n s t i t u t e33
Website/Collab
• Please visit our website and new Collab:– www.uvamii.com– Collab polling after presentations– Collab discussion forum– Post presentations and sector head
reports– Access research and educational
material– Improved transparency through timely
announcements/constant updates
M c I n t i r e I n v e s t m e n t I n s t i t u t e34
Questions/Comments
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