The stock market may have crashed this fall, but the enthusiasm of five of Yale’s aspiring financiers has reached its peak.
Last Thursday, a team of Yale students beat out 13 other university teams from the tri-state area to win the Seventh Annual Investment Research Challenge. The event, held at Thomson Reuters in Times Square, is sponsored by the New York Society of Security Analysts, a subsidiary of Chartered Financial Analysts. As the champion of this year’s competition, the Yale team will open the NASDAQ on Friday, and will compete in the CFA-sponsored Third Annual Global Investment Research Challenge, to be held in London on April 2.
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Led by team captain Steven Hao ’09, the Yale team included Stephen Oshman ’10, Michael Simpson ’10, Martin Wexler SOM ’09 and Ayung Tseng SOM ’09. This was the first year Yale competed in the competition.
“It was more work than any class at Yale I’ve taken so far,” Oshman said in an interview Wednesday. “But it was an incredible experience.”
The competition itself included two parts. First, each team was given a company — in this year’s case, Philips Van Heusen, one of the largest menswear suppliers in the world and owner of labels such as IZOD, Calvin Klein and Kenneth Cole — and asked to compile a report based on market analysis of the company.
Specifically, the report had to indicate to potential investors what they should do with Van Heusen stock based on certain economic trends. These reports were then read by a panel of Wall Street professionals, and the best four reports advanced to the finals: a 10-minute presentation of the teams’ reports, followed by a 10-minute questioning period from the judging panel.
Brian Stype, coordinator of the NYSSA competition, said Yale was the favorite to win since the first round of the competition.
“[Yale] was definitely the clear-cut favorite based on both their report and presentation,” he said. “They were well ahead of the No. 2 team.”
Yale’s team was distinctive in that it included both undergraduate as well as graduate students — the overwhelming makeup of the other teams was current MBA students — and members of the Yale team agreed that this diversity was a decidedly positive factor. Because of the tremendous workload in compiling the market analysis report, Simpson said, chemistry with the rest of the team proved vital to their success.
“We really gelled as a team,” Simpson said. “The guys at SOM had tremendous experience and skill, and we’ve become like a family.”
Indeed, the team’s academic interests span a wide spectrum. Oshman is a history major, Simpson a philosophy major, Hao a double major in molecular, cellular and developmental biology and economics. The only thing the team shares, they agreed, is a love for finance and investment.
“I’ve always been interested in the stock market,” Oshman said. “I’ve done internships [in finance] for the last couple of summers, and I love it.”
This diversity also factored into the team’s strategy. When analyzing their given company, they said they were the only team to focus on a more macro-level analysis — global licensing revenues, historic GDP trends and the like — while the other teams took a more “U.S.-centric” approach, Simpson pointed out.
Oshman said the team took the current recession into consideration: When projecting the company’s revenues, the Yalies turned to previous recessions and multiplied their effects according to scale. These compilations and calculations formed the bulk of the technical challenge in writing the report, Oshman explained.
The Yale team, the winner of the New York region — one of four in the global contest — will compete against the winning teams from three other regions: North/South America, Europe–Middle East–Africa and Asia–Pacific. The team will be flown to London in April where they will, once again, give a presentation and field questions on their report — this time to a panel of judges and against teams from around the world.
Oshman, Hao and Simpson said they remain cautiously optimistic about their chances in the global competition.
“Hey, we’ve got a one-in-four chance,” Hao said with a laugh. “But you have to remember that these are the best of the best from around the world.”
“It’s actually difficult to say,” Simpson said. “Because each region was given a different company, anything can happen. It all depends on what happens next month and the judges’ preference.”
The five students will travel to New York City to open the NASDAQ on Friday morning.