BSB Student Managed Investment Fund Report

STUDENT MANAGED INVESTMENT FUND REPORT

2022-23 Academic Year

Bertolon School of Business

ACKNOWLEDGEMENT With the generous resources provided by donors of the Student Managed Investment Fund and the Cabot Wealth Management Laboratory, Bertolon School of Business students develop their confidence and financial acumen by making investment decisions for the fund. Students expand their education beyond the classroom into the real world through this practical hands-on learning experience.

On behalf of the program’s participants – past, present and future – we want to express our appreciation to the following donors and companies for making this valuable opportunity possible: Rob and Rachel ’98 Lutts Mario Gabelli and Regina Pitaro

TABLE OF CONTENTS History of the Program 2 Update from Associate Professor Sanjay Kudrimoti

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2022-23 Student Asset Managers 4 Student Managed Investment Fund Performance

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Student Managed Investment Fund presentations took place in December 2023.

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HISTORY OF THE PROGRAM The Student Managed Investment Fund at Salem State University gives finance students experiential learning opportunities in portfolio management and the investment management process. It is made up of two endowed funds: the Rob and Rachel Lutts Student Investment Fund and the Mario J. Gabelli Student Investment Fund.

Founding donors, Rob and Rachel ’98 Lutts believe in the power of providing finance students with experiential learning opportunities in portfolio management and the investment management process. They created the first fund to be managed by Salem State students and provide annual scholarships for Bertolon School of Business students. We are thrilled that the first student investment fund scholarship was awarded in Academic Year 2022-2023.

Joining that same vision, Mario Gabelli and his wife, Regina Pitaro, grew the endowment substantially in 2021 when they created the Mario J. Gabelli Student Investment Fund with their generous $250,000 gift. Their support will make it possible for more students to get practical hands-on experience in investing and increase the number of student scholarships awarded each year in perpetuity.

In their investment courses, offered through the AACSB-accredited Bertolon School of Business, students enrolled in the Advanced Financial Analysis course are given the responsibility of managing the Student Managed Investment Fund. They take on the roles of portfolio manager, chief analyst, student trustee, and analyst, analyzing and investing designated funds into a variety of securities. Students are trained in the use of Bloomberg Terminals to analyze financial and non-financial information and make recommendations for investment of the fund. Students write analyst reports and present their research and recommendations to an audience of community members.

This experiential learning not only helps deepen student understanding of business and financial concepts but also sharpens their critical thinking, as well as their analytical, technical, written and oral communication skills.

Since the endowment’s creation in 2019, student participation has evolved from a directed study course to a course required of all finance concentration students.

Students learn the concepts related to financial decision making and value creation, and engage in the use of Bloomberg terminals for information extraction and data analysis. Students in Advanced Financial Analysis (Finance 468) manage the bulk of investments in the Student Managed Investment Fund, and learn the implementation process for investing the funds. They receive guidance on conducting research and investment activities and enriching their experience through active hands-on learning.

The idea for the course came from Bertolon School of Business alumnus, Joel Surette ’19, and his classmates in the university’s Finance Club, who took the lead on developing the framework for the fund.

The pilot innovation fund course, Individual Projects in Business Administration (Business 498), launched in the spring semester of 2019 with 10 business students enrolled and Salem State Accounting and Finance Professor Sanjay Kudrimoti leading the class. While the course was initially designed for students to discuss concepts and research businesses for investments, the goal of the new course is for students to create returns on the fund, therefore growing the assets to have more to invest and ultimately creating scholarships for students. Since it launched in 2019, more than 125 students have taken the course and have gone through the experience of managing a portfolio.

While the intent is to invest with a growth mindset, students also make sure that there is always some cash for the next set of students to invest.

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PROFESSOR’S NOTE Academic Year 2022-2023 (AY 22-23) started on an optimistic note for the Student Managed Investment Fund. With 16 students enrolled in the Advanced Financial Analysis class, the Cabot lab seemed to be humming again especially with life slowly returning back to normalcy post pandemic. Student Managed Investment Fund (SMIF) began the year with a total account value of $393,962.31.

Of this amount only $94,202.21 (23.91%) was invested in stocks and fixed income securities. The S&P 500 Index was sitting at 4,000.95 on 8/31/22, down from 4,766.18 at end of 2021 (12/31/2021).

Over the AY 22-23 SMIF had 24 (16 + 8 in the spring) student asset managers. Between them, they researched and recommended 15 Equity securities. These stock choices ranged from Materials, Industrials, Healthcare, Information Technology, to Consumer Staples, Financials and Utilities. By the beginning of AY 23-24 the SMIF account value was $414,456.59, of which half the amount $205,092.97 (49.5%), was still in cash holdings and the rest, $209,360.62 (50.5%), being invested across 42 individual securities.

Sanjay Kudrimoti Associate Professor, Accounting and Finance Advisor to Student Managed Investment Fund The below table tracks SMIF over time.

SMIF 01/31/2020 1/31/2021 8/31/2021 12/31/2021 8/31/2022 12/31/2022 8/31/2023 Equity $10,139.73 $12,814.24 $18,696.02 $60,052.05 $89,475.24 $154,834.30 $204,832.97 Fixed Income $5,498.00 $5,629.50 $5,583.50 $5,470.50 $4,727.00 $4,524.00 $4,528.50 Cash $9,635.80 $93,755.31 $87,532.17 $46,639.71 $299,760.07 $230,134.31 $205,095.97 # Securities 5 8 11 19 27 35 42

Additions to SMIF Portfolio in Fall 2022 Company AMGEN INC RTX Corporation LPL Financial Holdings Inc

Ticker AMGN RTX LPLA

Draft Kings

DKNG

Baker Huges, A GE Co NASDAQ Inc

BKR NDAQ

Walt Disney Productions

DIS

Atmos Energy Co

ATO

Sector Healthcare Industrial Financials Consumer Discretionary Energy Financials Communication Services Utilities

# Shares 50 100 50

Pur price $265.08 $98.19 $208.97

$ Invested $13,254.00 $9,819.00 $10,448.50

500

$12.73

$6,363.50

200 100

$29.70 $61.86

$ 5,813.50 $6,186.00

100

$90.54

$ 9,053.50

70

$117.23

$8,205.75

Additions to SMIF Portfolio in Spring 2023 Company Albemarle Corp Lamb Weston Holdings Inc Paypal Holdings Inc United States Steel Corp Northrop Grumman Livent Corp Gallagher, Arthur L & Co

Sector Materials Consumer Staples Information Technology Materials Industrial Materials Financials

Ticker ALB LW

Purchase Price # Shares Amount Invested $209.98 20 $4,199.60 $113.24 40 $4,529.60

PYPL

$60.83

60

$3,649.80

X NOC LTHM AJG

$21.92 $441.41 $25.53 $213.86

200 10 200 25

$4,384.48 $4,414.00 $5,106.20 $5,346.50

The above additions to the SMIF portfolio reflects not just a well diversified portfolio in terms of

sectors / industries but the portfolio is also well diversified in terms of the age of firms, size of firms and a good mix of value and growth. The next big step in the management of SMIF will be to train students on sell side analytics so that the portfolio is regularly balanced by weighing in when to captivate the gains and when to cut out the losses. To achieve this goal, the plan is to expand the management of SMIF portfolio over two semesters and in two different classes.

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FALL 2022 STUDENT ASSET MANAGERS Christopher Beaudoin was a senior from Wakefield, Massachusetts, with a finance major and a minor in information technology. He graduated in May 2023.

Vikramjeet Singh Bhamra currently works part time as a Universal Banker at Brookline Bank and as an Aquatics Supervisor at Life Time Fitness. Upon graduation he will continue to pursue a career in banking.

Outside of his time in the classroom, Vikram likes to spend his time working out, and playing/coaching basketball.

Victor De Leon was the first individual to earn a college degree in his family. Victor has demonstrated his leadership skills by taking the initiative to restart the ALPFA chapter of SSU. He held the role of Vice President and hopes that he leaves a great resource behind for future students like him.

Preston Dougherty is majoring in finance and minoring in economics.

Preston interned at Ameriprise Financial and gained experience in wealth management.

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Brad Feeder was a senior from Denver, Colorado and competed for the Salem State baseball team and as one of the top starting pitchers. Brad worked at SageWater and gained project management and accounting skills.

Anthony Paul Giannino III interned at UBS Financial Ins. in Peabody, Massachusetts. He is currently preparing for the SIE and Series 7 exams.

Dylan Guarino worked in Boston for Resolute Management internship position over the summer of 2022. After graduation Dylan plans to seek a fulltime job in the financial service sector.

Steven Jack plans to maintain his 3.93 GPA for his final semester as he prepares for his CFA Level I exam and his Series 7 and 66 exams. He also interned at Finer Wealth Management during the spring and summer semesters in 2022. During his time there he learned how to both manage and trade client portfolios and measure risk versus return for clients.

Scott Moschella, after working several years in the hospitality industry as a general manager of several restaurant groups, rejoined SSU during the pandemic.

Scott is a licensed realtor and works part time bartending at the airport as he finishes his degree.

Kyle Waldusky is studying business (finance) with a minor in economics. Kyle is also a member of the Men’s Ice Hockey team. In his free time away from school and the rink, Kyle enjoys playing golf and working out.

Business students present during the Student Managed Investment Fund Presentations in December 2023.

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SPRING 2023 STUDENT ASSET MANAGERS Kristina Green is employed as a teller at Eastern Bank and is a full-time mom and likes to volunteer at her church.

Garrett Hughes got curious about finance when he started investing in stocks during the pandemic. He is a fitness aficionado and loves going to the gym, biking and playing basketball.

Kayla Pennimpede is a first-generation college honors student majoring in business with a minor in writing. Kayla is a member of the Commonwealth Honors Program at Salem State, as well as a member of multiple honor societies and has been on the Dean’s List every semester for her academic achievements.

Lyne Pierre works in information technology.

Writing, dancing, singing, and cooking are a few activities that she loves to do.

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Stephen Poehler after graduating from Salem High School in 2012 joined the active-duty army and went to Fort Benning Georgia for basic training. He served honorably for 3 years while simultaneously pursuing a general education degree.

In 2016 he switched to the Reserves and went back to school full time in 2018. He is a first-generation law student and graduated in 2023.

Jack Sefrino is a studentathlete; he is a captain of the Salem State Baseball Team. Jack looks forward to his career in accounting and hopes he keeps learning more in his last two semesters.

Jack Strangie will be the fourth person in his family to graduate from SSU. In the summer of 2022, he had his first corporate experience as an intern in Business Development at a logistics company called Freight plus.

Justin Veith was on the football team at Becker College before his time at SSU, and played defensive back while earning CCCF Academic All-Conference in 2019 and 2020. His previous job experiences include a Party City fulltime associate, a volunteer tax preparer through Salem State’s VITA Tax Program, and completing/managing financial duties for a real estate partnership.

Khesahn Williams has extensive work and internship experience within sales, customer service and the financial sector. Within finance he has amassed knowledge from investment compliance, advisory and asset management from respectable firms such as State Street Global Advisors, John Hancock and Rise North Capital.

PORTFOLIO PERFORMANCE (July 1, 2022-June 30, 2023) The chart below is a dual axis chart. The SMIF started off with an initial cash infusion of $25,000 and over time more cash donations were made to the fund. Each semester the cash account was spent down, and new equity investments were made.

Over this time S&P 500 index has fluctuated between 3,225 points to a high of 4,766 points.

As of this report SMIF had an average return of 8% across its securities. The SMIF portfolio is not being compared directly with S&P 500 index at this point in time as the holding period is a varying parameter with stock purchases happening at intervals only during the end of each semester. Additionally, 50% of SMIF portfolio is cash holding as of the end of AY 22-23.

Portfolio vs S&P500 S&P500 PortfolioPerformance Peformance vs

Port Val without cash S&P (scaled)

7/ 1/ 20 8/ 21 1/ 20 9/ 21 1/ 2 1 0 02 1 /1 /2 1 1 0 21 /1 /2 1 2 0 21 /1 /2 0 1 / 21 1/ 20 2/ 22 1/ 20 3/ 22 1/ 20 4/ 22 1/ 20 5/ 22 1/ 20 6/ 22 1/ 20 22

130,000 125,000 120,000 115,000 110,000 105,000 100,000 95,000 90,000

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PORTFOLIO HOLDINGS AND RETURNS Ticker ATVI VZ

37.31

Purchase Value as of Last Gain / Loss # Shares Investment Price (12/12/2023) Percent $ 55.01 10 $ 550.10 $ 919.80 67.21% $ 57.18

25

$ 1,429.50

$ 932.75

-34.75%

DIS

91.32

$ 90.54

100

$ 9,053.50

$ 9,132.00

0.87%

TMUS

160.58

$ 119.24

15

$ 1,788.60

$ 2,408.70

34.67%

VC

123.77

$ 101.39

40

$ 4,055.60

$ 4,950.80

22.07%

BABA

71.09

$ 201.70

6

$ 1,210.20

$ 426.54

-64.75%

DRI

160.64

$ 148.27

35

$ 5,189.45

$ 5,622.40

8.34%

DKNG

36.52

$ 12.73

500

$ 6,363.50

$ 18,260.00

186.95%

F

11.14

$ 23.33

100

$ 2,333.00

$ 1,114.00

-52.25%

GM

33.66

$ 35.30

125

$ 4,412.50

$ 4,207.50

-4.65%

LW

103.36

$ 113.24

40

$ 4,529.60

$ 4,134.40

-8.72%

BKR

31.985

$ 29.70

200

$ 5,813.50

$ 6,397.00

10.04%

AJG

247.08

$ 213.86

25

$ 5,346.50

$ 6,177.00

15.53%

LPLA

229.43

$ 208.97

50

$ 10,448.50

$ 11,471.50

9.79%

NDAQ

54.075

$ 61.86

100

$ 6,186.00

$ 5,407.50

-12.58%

PLD

122.27

$ 118.61

40

$ 4,744.40

$ 4,890.80

3.09%

GNRC

120.91

$ 215.17

25

$ 5,379.25

$ 3,022.75

-43.81%

AMGN

275.31

$ 265.08

50

$ 13,254.00

$ 13,765.50

3.86%

CVS

73.69

$ 74.77

32

$ 2,392.64

$ 2,358.08

-1.44%

JNJ

154.96

$ 168.73

30

$ 5,061.90

$ 4,648.80

-8.16%

PFE

28.73

$ 34.02

50

$ 1,701.00

$ 1,436.50

-15.55%

REGN

863

$ 625.73

10

$ 6,257.30

$ 8,630.00

37.92%

AAL

14.11

$ 18.28

25

$ 457.00

$ 352.75

-22.81%

J

128.27

$ 137.39

35

$ 4,808.65

$ 4,489.45

-6.64%

INTC

43.98

$ 41.70

50

$ 2,085.00

$ 2,199.00

5.47%

DELL

69.92

$ 55.96

90

$ 5,036.40

$ 6,292.80

24.95%

AMD

136.33

$ 91.56

30

$ 2,746.80

$ 4,089.90

48.90%

MTZ

68.23

$ 62.28

38

$ 2,366.64

$ 2,592.74

9.55%

PYPL

58.685

$ 60.83

60

$ 3,649.80

$ 3,521.10

-3.53%

TCEHY

39.58

$ 49.46

30

$ 1,483.80

$ 1,187.40

-19.98%

SPOT

197.58

$ 146.38

8

$ 1,171.04

$ 1,580.64

34.98%

INTU

591.02

$ 358.90

20

$ 7,177.90

$ 11,820.40

64.68%

NOC

480.4

$ 441.41

10

$ 4,414.00

$ 4,804.00

8.84%

RTX

81.405

$ 98.19

100

$ 9,819.00

$ 8,140.50

-17.09%

UNP

233.65

$ 216.16

25

$ 5,404.00

$ 5,841.25

8.09%

ALB

127.95

$ 209.98

20

$ 4,199.60

$ 2,559.00

-39.07%

LTHM

14.575

$ 25.53

200

$ 5,106.20

$ 2,915.00

-42.91%

X

36.24

$ 21.92

200

$ 4,384.48

$ 7,248.00

65.31%

PCG

17.74

$ 12.10

400

$ 4,840.00

$ 7,096.00

46.61%

ATO

113.8

$ 117.23

70

$ 8,205.75

$ 7,966.00

-2.92%

ICLN

13.77

$ 26.20

50

$ 1,310.00

$ 688.50

-47.44%

BOND

90.5

$ 108.15

50

$ 5,407.50

$ 4,525.00

-16.32%

$ 191,574.10

$ 210,223.75

9.73%

Total

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Last Px (12/12/23) 91.98