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WKU students finish 2nd in TVA’s 2009 Investment Challenge Program

WKU students finished second in the Tennessee Valley Authority’s 2009 Investment Challenge Program.

The program is a partnership between TVA and 24 universities to provide students a hands-on experience managing a real stock portfolio for the agency.

In 2009, WKU placed second with a 45.62 percent rate of return and received a monetary award of $6,106. Lipscomb University finished first at 62.29 percent with East Tennessee State third at 43.83 percent.

WKU was the top performing public university and the top Kentucky school in the competition.

Students in the Practicum in Portfolio Management course taught by Dr. Indu Chhachhi have participated in the challenge since 1998.

Dr. Chhachhi, professor of finance and director of WKU’s TVA Investment Challenge Program, said he was pleased with the 2009 performance especially after the economic downturn in 2008.

“Our success in 2009 was the result of decisions made during the crisis of 2008 when students in that class looked for solid companies that would rebound when the economy improved,” he said.

During a calendar year, teams of students manage an average of $330,000 of TVA funds per school, by designing long-term investment strategies under the guidance of faculty members. That includes analyzing companies, buying and selling stocks and tracking the risks and returns.

“They make all the decisions,” Dr. Chhachhi said. “I’ve been working with this program since 1999 and every single time the students have been incredibly pleased with the experience.”

Even though many of the students are finance majors, the course isn’t restricted and has had students from accounting, marketing, mathematics, economics and management. Enrollment in the class is by application only.

While some students may be pursuing careers in banking, financial planning or investment management, the course provides “a valuable skill set for them to have in their personal lives as well,” he said.

Dr. Chhachhi said the Gordon Ford College of Business is looking to leverage this program by developing an investment management center. “A state-of-the-art center would take advantage of technology and better equip students with the tools needed to not only make better financial decisions while they are at WKU but also make our graduates more competitive in the job market,” he said.

In 2009, college students once again outperformed the experts on Wall Street. The Investment Challenge Program’s collective returns were 31.88 percent, which was 5.42 percent more than the return on Standard & Poor’s 500 index. Since the first full year in 1999, the program average has beaten the S&P 500 index eight times.

Other schools participating in the program included Trevecca Nazarene, Belmont, Vanderbilt, Alabama A&M, Western Carolina, Alabama-Huntsville, Mississippi State, Tennessee-Chattanooga, Murray State, Union, Tennessee-Martin, Memphis, Middle Tennessee, Kentucky, Tennessee, Austin Peay, Tennessee State, Mississippi, Mississippi University for Women, North Alabama, Christian Brothers and Tennessee Tech.

Contact: Dr. Indu Chhachhi, (270) 745-2928.

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