WALLA WALLA, Wash.-- "It's a giant responsibility," but the members of the student-run Whitman Investment Company are eager to see where they can take $100,000 which the College entrusted to them in January.
The money is a portion of the William M. Allen-Boeing Endowment, which is designated to fund campus visits by outstanding corporate leaders. The endowment was established by Grant and Nancy Allen Silvernale, '50 and '56, and Nat ('55 and Dorothy Allen Penrose.
Nancy Silvernale and Dorothy "Poo" Penrose, daughters of William Allen, a former Boeing CEO, say they are pleased to be offering Whitman students such contact with the realities of business and finance. "We know that Whitman students are exposed to a fine liberal arts education," says Dorothy. "I hope this endowment helps expose them to a real world perspective while they are still at Whitman."
While students at Whitman are taught to think and reason, adds Nancy, there's nothing like hearing some solid facts from successful business people in the outside world. "And I do think that the students managing the endowment funds will get some valuable real-life experience, especially with the incredible gains and losses that have taken place recently. It's the perfect time to see the opportunities and risks and learn how to balance them."
The original excitement of learning that the funds were theirs to manage was tempered with the realization that "it's a lot easier to lose money in the stock market than to make it," says senior Sean Collins. However, three of the main players in the investment company - former CEO Collins, current CEO Jake Rosenberg, and CIO Mark Stribling - see the recent downward spiral of the stock market as anything but daunting. "It's a perfect time for investing," concludes Collins, "especially if you're in it for the long haul."
Collins, an economics and music major, Rosenberg, a sophomore economics major with a politics minor, and Stribling, a junior theater-turned-economics major, speak with enthusiastic and justifiable confidence. Before they were awarded a chance with the real thing, they had gained considerable experience - on paper anyway. The students steered a "virtual" portfolio of stocks through a treacherous year of ups and downs that included a first quarter increase of 34 percent and a final tally that showed them outperforming their own benchmark.
The Whitman Investment Company has come a long way since its inception in spring 1999 as the Whitman Money Makers, a club where people could get together and discuss hot stock tips. It was during the first few meetings of the Money Makers that someone suggested setting up a student-run mock portfolio, says Rosenberg. From there the concept grew into the idea of managing part of a College endowment, Collins adds. "Several club members went to (treasurer) Peter Harvey to discuss the possibilities. He was very supportive but wanted to give the club a chance to prove itself and work out the structure of the organization before the members actually dealt with a large amount of money. We managed the virtual portfolio for a year and a half and during that time we set specific guidelines. We ve worked hard toward this goal of managing real money."
The structure of the WIC, which can be studied in detail at the group's website, goes something like this: any member of the Whitman student body can attend meetings (held weekly) and be a member. However, to be a trustee who can vote on the buying and selling of stocks, one must attend at least 75 percent of the meetings, research and give quarterly reports on different stocks, and be voted in by the current trustees.
"Our strategy has definitely evolved," says Collins, and Rosenberg adds, "One thing I've come to realize is this: Have a strategy. Then look through your portfolio and evaluate it three to four times a year." If people are investing for the long term, adds Stribling, it doesn't take that much time to manage a portfolio. "More or less, stocks go up in the long run so just maintain a well-diversified portfolio." The endowment funds appear to be in the hands of a group of knowledgeable and hard-working students who are not satisfied with just making money. "We see ourselves as an educational group," said Rosenberg. To this end, the club trustees give public lectures on various subjects such as how to invest, and in February the club started a "Stock Market Challenge," a monthly competition in which the member who manages the most successful virtual portfolio will win $100.
And what's next on the agenda? For Collins, graduation in May, and a job at the Seattle branch of Deloitte Consulting, one of the world's leading e-business, consulting, and integration firms, where he interned several summers ago. But first, in March, he will be the featured solo pianist at the Oregon East Symphony s concert. He earned this honor in January when he won first place in the Oregon East Symphony Young Artist Competition with his performance of Rachmaninoff's Piano Concerto No. 2.
As for Rosenberg and Stribling, they also express an interest in consulting when they graduate from Whitman, but first they want to make good on the promise they made to certain College officials about making the funds entrusted to them grow. But be sure of this: These Whitman students have a plan, and we haven't heard the last of them.