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| October 1998 Business school wins The money comes from the D.A. Davidson Student Investment Fund. D.A. Davidson & Co., an investment firm headquartered in Great Falls with 26 branch offices in the Northwest, offers the fund to select institutions, giving business students an opportunity to apply real money and modern financial theory to investment decisions and actual market transactions. During the past year UM competed against eight other universities in the Northwest to see whose business students could squeeze the most profit from $50,000. UM came out well ahead of the pack with a 12.49 percent increase in its portfolio, and due to the rather bearish turn the market has taken of late, it was the only university to post a positive gain. UM's closest competitor lost 6.9 percent, and the last-place institution was down 31 percent. The mentor for the 15 students in UM's Finance 495 was Philip Perszyk, an adjunct faculty member for the School of Business Administration and a financial consultant for D.A. Davidson of Missoula. Perszyk said the universities participating in the contest get to keep half of any profits earned beyond 5 percent, and this year he was able to present a check for $1,855 to the UM business school. "It's pretty gratifying to finish at a 12.49 percent increase considering the market we are in," Perszyk said. "I've been teaching the class for seven or eight years, and this is the first time we've seen losses like this. Seven of the eight participating schools lost money, and D.A. Davidson assumes those losses." The investment fund program was started in 1985. Over the years the number of participating institutions has swelled to include UM, MSU, the University of Idaho, Boise State University, Washington State University, Carroll College, MSU-Billings and Gonzaga University. Brigham Young University will join the program next year. Perszyk said Finance 495 is a three-credit fall semester class for seniors. After Sept. 1 the students may begin altering their starting portfolio of $50,000. The program allows students to invest in bonds, but Perszyk limits his classes to buying stocks. Last year's class actually involved much more than "playing" with money. Students wrote three major papers, and Perszyk said some students get scared off by the amount of work involved. He also brought in numerous guest lecturers - such as a bond trader and the finance manager for the city of Missoula. "Then I set students to work examining the existing portfolio," he said. "By mid-semester they give an oral presentation on which stocks they would sell, which they would keep and then tell why. Then we vote democratically to sell portions of or all of the portfolio. I've found students are very serious in this decision making. I have veto power, but I've never had to use it. Our final business decisions are made in December." Perszyk said students are inclined toward aggressive investments at first, but then they become more conservative as the semester progresses, learning that safer, long-term investment strategies usually pay larger dividends in the end. An associate vice president for D.A. Davidson, Perszyk committed about 120 hours a semester to teaching Finance 495. UM will be losing a good deal this semester, since Perszyk has decided to take a year off from teaching the class, and he normally returns his salary to the University. However, the University welcomes Tim Kato, Perszyk's fellow D.A. Davidson financial consultant, who is teaching the class this semester. -- Cary Shimek, University Relations
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