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Student-Run Investment Fund Distributes Money for Scholarships

Nov. 15, 2019

For 18 consecutive years, Baylor University’s student-managed Philip M. Dorr Alumni & Friends Endowed Investment Fund has provided generous contributions to student scholarships totaling over $2 million over its lifetime. This year, the Fund contributed $175,000 in support of student-athlete scholarships.

Furthermore, for the 2018-2019 academic year the Fund provided a total of $365,000 with the additional funds going to pay faculty salaries, pay for data and software, and to fund a student internship with the Baylor Investment Office. The Practicum students have increased the fund’s value to about $8.7 million in 18 years of managing the portfolio.

Based on a very generous donation from Baylor alumnus Philip M. Dorr, a unique financial investment project was created in 2001, which allows Baylor business students to receive first-hand investment fund management experience. Students utilizing resources in the state-of-the-art Hodges Financial Markets Center manage the Fund. Annual distributions from the Fund go toward athletic scholarships, faculty salaries, data and software, and an investment internship.

“Our portfolio management practicum course is a tremendous opportunity for students at Baylor. While there are many student managed investment funds around the country, there are very few that manage such a large pool of money. We are thankful for the generosity of Mr. Dorr and all the donors who made this possible,” said Shane Underwood, Finance department chair and holder of the Pat and Thomas Powers Endowed Chair in Investment Management.

The fund's objective remains two-fold: 1) to provide an investment fund by which business students can learn investment management principles and techniques by managing real money and 2) to provide scholarships out of the fund's growth in the market value.

The investment policy of the Fund dictates that a long-term return should be as high as possible, within prudent limits, but at least as high as the S&P 500 (with dividends reinvested). Due to the structure of the classroom setting surrounding the Fund, an infinite time horizon is assumed with a tolerance for risk. The fund's normal or strategic asset allocation is 100 percent stocks.

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