Undergrads manage $5 million BEAM fund to portfolio success

Nov 26, 2012

The BEAM students visited the head office of RBC on their recent trip to Toronto

A group of undergraduate students at the Beedie School of Business have been immersed in the finance world recently, starting with a trip to Toronto to view the city’s finance sector first-hand, and ending with their third quarter presentation as managers of the Beedie Endowment Asset Management fund.

The Beedie Endowment Asset Management (BEAM) fund was established in 2011 and is the largest undergraduate-run investment fund in Canada, with $5 million invested in Canadian equities, fixed income and cash. Students participating in BEAM are responsible for managing the fund, and receive hands-on experience in investment research, analysis, and trading in bonds and equities markets.

Participants in BEAM are expected to present their performance on a quarterly basis to a performance review committee consisting of industry experts, and the current students were able to present some positive figures for quarter three.

The portfolio yielded a 3.01% return in quarter three, which created a $147,000 profit for the quarter overall. The portfolio ended the quarter above the initial $5 million investment, the first time it has risen above its starting investment since its establishment.

“Faced with a tough market, our team opted to employ some tactical reallocation mid-way through the quarter, which allowed us to adjust to the changing market and emerge with a positive return,” said Ryan McCutcheon, chief risk officer and diversified sector co-manager of BEAM. “Thanks to the lessons we learned from the last quarter, and the establishment of our new risk management system, we are confident that our results will improve even further going forward.”

The presentation of the portfolio’s quarter three performance occurred shortly after the BEAM students had returned from a week in Toronto, where they spent time in the company of the city’s financial sector professionals.

The students were given the opportunity to network with some of Toronto’s top financial experts, who shared with the students their insights and experiences of working in the financial sector of a major city.

The trip also included visits to the head offices of several leading banks and hedge funds, including BMO, TD, Scotia, RBC, NexGen, CPPIB, Polar Securities and Sprott Asset Management, as well as guided tours of some of the largest trading floors in North America.

“The trip to Toronto was an amazing experience and really gave us an insight into what it would be like to pursue a career in Canada’s financial hub,” says McCutcheon. “At each visit we had industry professionals waiting to talk to us about their roles and what it was like to work for each company, which was very impressive. Just being able to network with that level of professionals and hear their insights into the markets was a major highlight of the trip.”

With a constant turnover of participants, one of the main challenges for the BEAM program is recruitment, and the current students are developing a process to bring on more business students to the fund early next year. For McCutcheon, the opportunity to participate in BEAM is one which he highly recommends.

“Managing the BEAM fund is an incredible hands-on experience, one which I would recommend to anyone with an interest in finance,” explains McCutcheon. “The caliber of technical knowledge and networking experience you gain from taking part in such a real-world exercise is amazing. Participating in BEAM is far above and beyond regular school and forces you to learn many things which you would not otherwise be exposed to.”

For more information about BEAM, visit http://beedie.sfu.ca/beam/

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