2021 SPRING DEPARTMENT OF FINANCE NEWSLETTER

Chair’s Message

Greetings from the Department of Finance!  We hope all has been going well in this unprecedented COVID-19 pandemic.  We are pleased to share news and stories of the past year through 2021 Department of Finance Newsletter.

We completed move-ins to the new College of Business building, Maurer Center, during the month of last August, and the College of Business is now officially named as “Allen W. and Carol M. Schmidthorst College of Business” with a transformational naming gift.  This academic year, our classes have been offered in one of three delivery modes, in person/hybrid, remote, and online (web-based) by strictly following CDC and university safety guidelines and protocols.

While the overall university enrollment increased and hit a record high this fall, it was mainly due to the exponential increase in the online MBA program.  Similarly to the university, the undergraduate enrollment for Schmidthorst College of Business was down to 1916 this fall from 1955 last fall.

We finally had a “break” this past fall in the unstoppable growth of our Finance program over the last decade.  The Finance program had a total of 284, consisting of 265 in Finance Specialization (down from 298 last fall) and 19 in Finance Minor (up from 18 last fall).  The Insurance program had a total of 49, consisting of 25 in Insurance Specialization (up by 1 from last fall) and 24 Insurance Minor (up by 14 from last fall).  During the last academic year, 66 and 13 Finance and Insurance program students graduated, respectively.  The online MBA program, which started in Spring 2019, has enrollment of 385 in Spring 2021, of which 40-50 students are expected to concentrate in Finance.

Your continuing strong support led the Department to award $27,500 to 43 Finance students and $17,500 to 23 Insurance students in scholarships as well as two Graduating Senior Awards in Finance and Insurance, each with a plaque and $500 cash prize this past year. We thank all our donors deeply and wholeheartedly including Insurance & Risk Management Institute members, alumni, friends, and department colleagues for their support.

There was no change in department faculty during the past year.  While the position of a full professor with Darwin B. Close Professorship was approved by the university in fall 2019, the hiring process has been on hold since last March due to the COVID-19 pandemic.  The Department has recently submitted a new request of the same position for next fall.  The Department have had a new administrative staff since last June; Holly Orlowski (hmorlow@bgsu.edu) replaced Kristin Forman.  Dr. Liuling Liu was on FML this past fall, and is on Faculty Improvement Leave in Spring 2021.

Due to the pandemic, the Department was not able to hold many annual events such as Finance and Insurance Advisory Board joint meeting, Insurance & Risk Management Symposium, Insurance & Risk Management Institute Dinner, Graduating Senior Reception, and Finance Speaker Series.  Hopefully, we can go back to normal or ‘new’ normal and engage fully in these events starting this fall.

We’d like to hear from you.  Please share your stories of how and what you are doing in your career with our students and other alums.  Simply email or fax the questionnaire at the end of the newsletter.

Although we are still in the challenging times, we are cautiously optimistic about days ahead and looking forward to a year of rebound and continuing progress.  We invite you all to be a part of this endeavor.

Until our next communication, we wish you and your family to stay well, safe, and healthy.

Go Falcons!

Sung Bae, Chair

Spring 2020 and Fall 2020 Graduates Job Placements

Novogradac and Co LLP
Western and Southern Life
Nationwide
Medical Mutual of Ohio
Bendix
Bendix Commercial Vehicle Systems
Rehmann
21st Century Financial

Scholarship Information for 2020-2021 School Year

Finance awarded $27,500 in scholarships to 43 students.  Scholarship winners are listed below:

Insurance awarded $17,500 in scholarships to 24 students. Scholarship winners are listed below:

Student Success Story

Two students, Mitchell Hogrefe and Gabriel Payne, participated in the Federal Reserve Bank of Cleveland (FRBC) Undergraduate Research Poster Competition on May 3, 2019. Mitchell Hogrefe won the first place in the Finance Division of competition. Mitchell’s project title was “The impact of student loans on post-graduate life”. Gabriel’s project title was “The impact of social capital on small business survival and success”. Two students’ research projects were under the guidance of Dr. Liuling Liu.

A Synopsis of Mitchell Hogrefe’s First-Place Project:

Student loans, as a progressively increasing portion of consumer debt, are becoming a concern to the society and economy. There is a growing awareness and interest among the public and policymakers of the important role student loans can play in the life of students after they graduate. Several existing studies examined the impact of student loans on home ownership and mortgage, and found inconsistent results. In this project, Mitchell proposes that post-graduate life consists of two major aspects: home purchasing and career development. He identifies that there is no study has investigated the impact of student loans on the career performance. In his empirical model, he regresses the firm productivity on the student loan per capita, controlling for various firm characteristics and firm-fixed effect. He finds that students with higher level of student loans have pressure to work harder and be more productive. The effect is more pronounced when the firm is riskier.

Student Managed Investment Fund (SMIF) Update

The BGSU Student Managed Investment Fund beat the market as part of FIN 4360/MBA 5610 – Portfolio Management taught and advised by Dr. Stephen Rush. Eight undergraduate students and 1 graduate student managed a long-only equity portfolio worth about $725,000. The goal of the class is to beat the S&P 500 index (a benchmark widely used in the investment management industry) by researching and presenting undervalued stocks as well as tactical asset allocation between industries. Each student must convince the other students of their investment idea in order to change the portfolio and the class must generate enough value in a single semester to outperform for the entire year. This semester was particularly challenging given the hybrid course format. The class used the new visualization lab in the Maurer Center to integrate in-person and remote presentations.

Over the 2020 calendar year, the fund returned 21.74% compared with a market return of 18.35%. The students beat the market with valuation skill rather than by taking on excess risk. The fund returned an alpha of 3.78% after accounting for risk. By comparison, an index fund has no alpha and most active managers have negative alpha after accounting for taxes and fees. The past year represents the continuation of excellent investment performance by previous classes. The portfolio has delivered a total of 51.95% over the past 3 years or approximately 1% higher than the market each year. The end of semester report has been useful for prior students getting jobs in the investment industry and this year’s performance will likely be even more beneficial.

Participating Students: Gayge Carroll; Travis Cring; Emilee Davis; Connor Ford; Janae Johnson; Carson Musser; Michael Ramirez; Marco Solis Hinojosa; Christopher Sullivan

Gamma Iota Sigma Update

(Written by Professor Roc Starks, GIS Faculty Advisor)

Gamma Iota Sigma activity has been somewhat limited due to the Covid 19 protocols here on campus.  The chapter has been actively attending many virtual events hosted by the Gamma Iota Sigma Grand chapter, including virtual job fairs, networking opportunities and educational programming.

Our chapter is also participating in the Diversity, Equity and Inclusion efforts as part of the overall national Gamma Iota Sigma initiative.

Elene Kaufmann, from Fairview Park, Ohio, is serving as the Gamma Iota Sigma Chapter President for the 2021-2022 academic year.”