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Lehigh students look to build on portfolio design success

Lehigh University has been asked to once again participate in the Clear Next Generation Portfolio Design Contest. The contest is open to all students at Lehigh and runs from Oct. 15 to Dec. 1.

The highly competitive, international competition was created in 2007 by Clear Indexes LLC, a wholly owned subsidiary of Clear Asset Management Inc. Lehigh fared well in the inaugural contest, capturing nine out of the top 13 awards in the spring of 2007.

“A year ago, Lehigh University was honored with the greatest number of awards. I look forward to once again receiving competitive entries from this talented student body and perhaps seeing one of the submissions claim the grand prize, which is based on a great investment thesis and being cognizant of how an investor will perceive it,” says Andrew Corn, CEO of Clear Asset Management.

Now in its third round, the contest has grown to include more than 10 schools and more than 200 submissions. Awards are handed out to students proposing the most unique and marketable portfolios, with the grand prize winner earning $5,000 and a possible internship with Clear Index to work on the investment or publish the award-winning index.

Students interested in learning more should contact Anne Anderson, assistant professor of finance, and join a Facebook page created by Clear Index that outlines the competition’s rules and updates participants with the latest news and contest developments.

“Given the current turmoil in financial markets, any opportunity for our students to learn about alternative investment vehicles and to apply what they have learned in class is value adding,” Anderson says. “This contest is a great chance for our students to test their creativity and to showcase their talents to potential employers."

Last year's contest asked students to develop original ETF (or Exchange Traded Funds) ideas. There are currently 814 ETFs in the U.S., and their low costs, tax efficiency, and stock-like features have fueled their ongoing popularity. Although they resemble mutual funds in their makeup, ETFs can be traded throughout the day as their prices fluctuate, making them a flexible alternative for investors.

Because of the growing interest in the competition, however, Clear Index expanded the fall 2008 contest to include equity portfolio designs including long-only portfolio solutions and alternative investments. According to the company, “Choice and versatility foster creativity. We found that many of the innovative ideas that students conceived for Exchange Traded Funds (ETFs) in past competitions could be applied successfully to other mediums.”

Previous winning ideas included an International Sports investment concept from students at York University’s Schulich School, which focused on publicly traded equities of holding companies that own professional sports teams and clubs. A New York University student won in 2007 for his US Exporters Index, an idea that benefited from a growing global economy and the reduced value of the dollar.

Pengcheng Lin, formerly a graduate student in Lehigh’s M.S. in Analytical Finance program, captured one of two second prize awards for his 2007 submission on the China 30 Value Index.

“The 30 value index focuses on Chinese companies listed on U.S. stock exchanges which can bring investment profits in the long run,” he said at the time. “It provides marketability and liquidity for investors.”

--Tom Yencho


Posted on Thursday, October 02, 2008

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