Trading SpacesJan. 18, 2005
Baylor's newest classroom, the $900,000 Southwest Securities Financial Markets Center, officially opened Jan. 10 in Cashion in the Hankamer School of Business.
Primarily for business graduate students in the Portfolio Management Practicum, the center offers the same tools used by top Wall Street investment firms: Bloomberg machines, scrolling digital tickers, flat-panel monitors and numerous financial databases. With dark wood paneling and smoked glass on the exterior, the center packs "a major wow factor," says William Reichenstein, professor of finance who teaches the portfolio management class.
The students in the practicum, almost half of whom are undergraduates who make special application to take the course, use the new investment center to manage the Philip M. Dorr Alumni andáFriends Endowed Investment Fund. Dorr, BBA '80, MBA '83, established the student-managed fund in 2000 with an initial investment of $250,000, which was increased through additional alumni donations. In 3 1/2 years, the fund has increased in value to more than $5.5 million and has outperformed the S&P 500 by more than 3 percentage points annually during that time, Reichenstein says. In February 2004, Baylor Athletics received $75,000 for scholarships for student-athlete business majors from the fund, as was Dorr's intention.
In addition to the bells and whistles, what sets this high-tech classroom apart is what it brings in from the East Coast. Students consult through a weekly video teleconference with Brian Bruce, director of Global Investments with PanAgora Asset Management in Boston.
"Adding someone who has that type of expertise and experience is invaluable," Reichenstein says. "He designed this course the way he manages his own mutual fund family. He has been an active stock manager for 20 years and is currently managing $17 billion at PanAgora."
Susan Etheredge, BA '76, MIM '77, is the managing director for the center. She is a lecturer in finance and worked in the corporate sector before returning to Baylor in fall 2004. Etheredge says she is excited about the connectivity and professionalism the center brings to the campus. "This is a real-time situation. This is the same info that someone managing a multimillion-dollar portfolio would be utilizing to make their decisions. This is a professional environment for students who are doing a professional function," she says.
The center is the brainchild of Terry Maness, dean of the Business School. It was made possible in part by a multimillion-dollar donation from Don and Ruth (BA '49) Buchholz. "[They] provided the initial seed capital for the endowment of the center to provide for the operating budget as well as construction funds," Maness says. "They provided an additional endowment in the name of Southwest Securities to name the center, and a number of additional donors provided the necessary funds toácomplete it."
Unlike graduating business students from most other schools, who only manage theoretical portfolios, Baylor students graduate with practical experience handling real assets using one of the largest student-managed portfolios in the country, Reichenstein says.
"It certainly enhances their opportunity to get jobs in the securities analysis areas," he says. "This classroom essentially opens the doors and lets students who are excited about securities analysis go as far as their energy will take them."