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Faculty Spotlight: Leo Chen Takes Over the Reins of the Student Managed Investment Fund Program

By Keith Morelli

TAMPA (August 16, 2017) -- There's no Monopoly money in the Student Managed Investment Fund Program. It is "real money in real time," said Leo Chen, the new director of the program at the University of South Florida's Muma College of Business.

The course offers motivated, well-prepared students the chance to participate in simulated financial management strategies and decisions, but more importantly, they are taught how to use real money to make real profits through smart investments. Student analysts undergo an extensive two-semester program that involves workshops on security analysis, meetings with finance professionals and making stock pitches.

All that takes a lot of market research and a lot of financial savvy, said Chen, who takes over teaching the course this fall.

"I am excited to return to the classroom, especially in the Muma College of Business," Chen said. "I'm looking forward to working with some of the brightest students in the finance department, teaching real lessons using real money and real investment opportunities."

In a sense, he's coming home to teach the course. After graduating with a bachelor's degree in economics from the University of Rochester in New York, Chen, who in 2010 was the mathematics research scholar at Toronto's Fields Institute for Research in Mathematical Sciences, earned a PhD in finance from USF just two years ago.

He currently is a portfolio manager and quantitative strategist at Cumberland Advisors in Sarasota, where he actively manages two U.S. equity portfolios that target minimizing portfolio risk and maximizing overall return. He specializes in quantitative analysis and his research utilizes quantitative methods to examine market returns and underlying volatilities. As a strategist at Cumberland, Chen uses his background in mathematics to help interpret risk in the markets.

"All that will come into play in the classroom," he said. "The fluxes in the market, the vagaries of stocks, the ups and downs of Wall Street; all are part of making sound decisions with your – or in this case – our money."

Chen's research has been mentioned in the Wall Street Journal, Barron's, Morningstar, USA TODAY, Bloomberg Radio, MarketWatch, Business Insider, Yahoo!, and various international media in Asia and Europe.

"It's great to have Dr. Chen back in our fold as a visiting professor and director of our Student Managed Investment Fund," said Jianping Qi, chair of the Muma College of Business's Finance Department. "In the few short years since earning his doctoral degree in finance here, he has excelled in the private sector as a strategist and a portfolio manager.

"His knowledge of investment research will serve him well as he teaches the nuances of finance and investment strategy to our top-tier students taking the Applied Securities Analysis class."

The class involves teams of students investing the money in the fund. Their recommendations are reviewed by an advisory board made up of investment professionals and financial advisors from around the Tampa Bay area.

These financial and investment leaders share expertise and interact with students during their presentations, sometimes offering critical observations. Their feedback helps students understand there is more to making successful investments than just research.

"The research that goes into selecting a certain stock in which to invest is only part of the course," said Chen. "The other part is mounting a pitch that is all inclusive and can withstand the critical scrutiny of the investment professionals on the advisory board who will either give the thumbs up or the thumbs down to the students' work."

Though these corporate partners may extend internship opportunities to students enrolled in the course, benefits go both ways. The business community gets access to extensive research reports and other investment fund materials generated by the students.

Last year, the fund showed a 15 percent investment return, gained mostly after October. It outperformed the S&P 500. At the end of the year, the fund's assets totaled $513,021.