2007-2008 Annual Report

Cedarville University made a valuable investment in the education of business students in February 2008 by creating the Student-Managed Investment Fund (SMIF). With an initial investment of $75,000, the fund allows majors to research and recommend stocks for inclusion in the SMIF portfolio. Before the SMIF, students managed virtual stock portfolios online. But when they began dealing with real money, their level of interest and dedication increased exponentially. They realized they were now responsible for decisions that would lead to real gains or losses for the fund. It certainly made success more real ... and more interesting. Devin Krupka, a 2008 finance and accounting major, was involved in the first class that managed the fund. When I look back on the four years I spent at Cedarville, I’m reminded of the many amazing opportunities I had. I believe the combination of academic and spiritual growth is a big part of what makes Cedarville what it is. One of the academic opportunities I participated in was the Student-Managed Investment Fund. Through this program, we were able to actually apply the knowledge we had learned in previous classes about investing in the securities markets. It allowed us to go beyond theory, beyond simulation, and into the reality of investing. While there is much to learn from being involved in a program like the SMIF, two key lessons from my experience relate to responsibility and judgment. It’s easy to see where responsibility comes in. After all, we were given $75,000, and what happened to that money was a result of our investment choices. All members of the class were held responsible not only for their own investment proposals but also for every investment choice the class made — whether it was originally their own Smar t Money Re f l ec t i ons on t he St uden t -Managed I nves tmen t Fund Devin Krupka‘08 suggestion or not. This means they had to understand the opportunities and risks for every proposed investment and support their suggestions in order to make the best investment decisions. Secondly, to adequately support a proposed investment, class members had to rely on their own judgment. Good judgment allowed them to take the universe of information about an individual security and narrow it down to what would be helpful in deciding whether to make the investment. In a world with so much information available, it is vital to be able to decide which pieces of information are truly valuable. Developing this judgment helps to bridge the gap between knowing the theory of investing and actually applying it. In these ways, I witnessed how the SMIF helps Cedarville accomplish one of the things it strives to do: teach students to acquire and apply knowledge; not just to know, but to know and to do. 20 Experiencing the Real World