Eberhardt School of Business News
Beat the Street
(February 14, 2008) -
by Raschad Pittman
University of the Pacific’s Board of Regents recently approved an additional $250,000 for the Eberhardt Student Investment Fund (SIF) that already consisted of $1 million. Depending on the students’ performance, the Board could grant up to an additional $750,000 more over the next two years, which could bring the total University contribution to $1 million and the fund total to over $2 million.
Since it was formed in January, the SIF grew to over $1,143,690 from the initial $1 million. Nine students at the Eberhardt School of Business currently participate in the fund, one of only 200 student investment funds in 9,000 business schools worldwide. It was made possible by a $1 million gift from the Bank of Stockton and its President and CEO Douglass M. Eberhardt.
The original $1 million gift will be fully invested by the end of the year according to Eberhardt. The University could approve an additional $250,000 every six months for the next two years to invest as part of the proposal approved by the regents. The students will make a formal presentation for approval of the remaining matching funds, mirroring the real life experience of being accountable to an actual client.
“The matching grant from the Board of Regents enables the students to remain in an ‘investment picking mode’ where they continue to research and analyze opportunities, while also managing the current investment portfolio,” Eberhardt said. “It’s a wonderful matching gift that furthers the learning process. Thus far, the students’ performance has been exemplary, outperforming S&P and many managers.”
The students conduct research and evaluations, write reports, and decide how the money will be invested. They are accountable to the fund’s board, which consists of the dean, the vice president of Business and Finance for the University, and four investment professionals. The students must produce an annual report of their investment activities and results. Their work, transactions and report will be audited by an independent accounting firm, which is typical for an investment fund.
Each year, a percentage of the fund’s net assets, equal to the endowment spending rate set by the Board of Regents, will be distributed to benefit the University. Based on the wishes of the Eberhardt family, one-third of the annual distribution will go to speech-language pathology, one-third will go to the men’s water polo team, and one-third will go to the Eberhardt School of Business.
Strictly Business Fall/Winter 2008 Issue
