Michigan Tech Husky Investment Tournament—Spring 2021—Week Four

Welcome to week four of the Husky Investment Tournament!

When you think of investing what comes to mind? Is it finding the next Facebook? The S&P 500? Tesla? Amazon? While all of the above have their time and place, let’s talk about the different types of investing this week.

Three distinct types of investing have been talked about throughout the financial world. Fundamental investing is the type that comes to mind most people. The people that follow this type of investing look deep into a company and its financials to determine whether they should invest. Next, is technical investing. The people that participate in this type of investing will focus on forecasting trends that happen in stock prices. They spend a large portion of their time reading charts. Lastly, we have quantitative investing. Under this type of investing high-frequency algorithms are developed and implemented. This type of investing drives a lot of our current stock market today. 

Referencing back to our week two post, what style of investing do the Reddit traders fit? Very good question. There could probably be an argument that they are following a technical strategy because they are exploiting trends in the stock price movements. However, in my opinion, I would place these traders in their own bucket. They have their own unique type of investing based on a forum from the internet. In this week’s video, Trevor Salata discusses the different types of investing in further detail. 

Michigan Tech Husky Investment Tournament Spring 2021—Week Three

Welcome to week three of the Husky Investment Tournament!

The third round of stimulus checks were just approved this past week. The bill came out to a total of $1.9 trillion dollars. Some of you may question why the government is willingly giving us cash. The reason is purely economic. The point of the checks is to have citizens spend the money when it is received and “stimulate” the economy. An issue that has come up with these checks is that many Americans are taking their checks and putting the money aside. This action defeats the purpose of the “stimulus” checks. Hopefully, enough Americans spend their checks and the economy sees an increase in activity. The stock market should mirror the increase.

Better economy = higher stock prices = lower unemployment = economic recovery from the pandemic

It is good in theory, but it will be interesting to see how the economy reacts going forward. Many of the major stock market indexes are reaching all-time highs and hope is on the horizon for all Americans. However, is the economy really in a better place than before COVID-19? Or is our economy artificially propped up from three rounds of stimulus, and near-zero percent interest rates? 

For this week’s video, Laura Connolly, an assistant professor of economics at Michigan Tech, discusses economic indicators and how investors can use them to gauge their investment decisions. Please note, the rates and indicators in this video are from October 2019; however, the information surrounding how to read and interpret these ratios is relevant.

Appleton Senior Awarded Michigan Tech Impact Scholarship

Michigan Technological University’s College of Business announces Rachel Weyenberg of Appleton, Wisconsin, as the 2021-22 Impact Scholarship recipient.

Weyenberg is the daughter of Amy and Kevin Weyenberg and is a senior at Appleton East High School. She is active as the vice president of competitive excellence in DECA, an association of high school business students who participate in career development, social events, community service activities, and competitions. She credits DECA for helping her discover a passion for business and leading her to Michigan Tech. 

photo of Rachel Weyenberg

On campus in Houghton, Weyenberg plans to pursue construction management, become active in Enterprise, and land an internship. Supported by both the College of Business and the Department of Civil and Environmental Engineering, the interdisciplinary construction management major was recently named the best construction management program in the state by Universities.com.

“I fell in love with Michigan Tech and all the unique opportunities offered by the University. What made me decide to attend MTU was how amazing the College of Business is. When I toured campus I met with both Associate Dean Buche and Dean Johnson. They made me feel welcomed and at home. I love the one-on-one attention each student receives and the hands-on approach.” Weyenberg says.

The Impact Scholarship, organized by Admissions, Financial Aid, and the College of Business, is an annual competitive award recognizing Michigan Tech business majors. Held virtually this year, 41 high school senior finalists from seven states were invited to participate in leadership activities via Zoom and received renewable awards ranging from $1,000 to full in-state tuition.

“Evaluators were struck by Rachel’s communication skills including public speaking experience as well as her outgoing and positive approach,” says Shannon Rinkinen, director in the College of Business and chair of the Impact Scholarship committee.

Weyenberg is also active in student council, National Honors Society, link crew, pep club, and varsity soccer. In her free time, she enjoys spending time with family and friends, watching movies, and going on road trips.

“I am extremely grateful for the Impact Scholarship. This opportunity will allow me to further my education without the stress of out-of-state tuition. I know that I was meant to be a Husky.”

Next year’s Michigan Tech Impact Scholarship application will open in summer 2021.

Michigan Tech Husky Investment Tournament Spring 2021—Week Two

Welcome to week two of the Husky Investment Tournament!

Have you been paying attention to the financial news? This past month has seen a large amount of coverage given to normal everyday people. The stock market has felt the impact of retail traders banding together over social media to increase share prices. 

Retail traders are people like you and me that do not hold large amounts of financial resources. In the past, this group was never given a second thought, but when they came together, Wall Street took notice. Gamestop stock saw its price rally from $15 to $350 at the peak. Many hedge funds who sold the stock short lost a significant amount of money.

It got to the point where well-known trading apps such as Robinhood had to restrict the trading of the selected stocks. This led to even more interest in the story, and even more people investing in the selected stocks. Congress recently decided to get involved and it will be interesting to follow along and see how this all plays out.

It is important to note that for all the retail traders that made money, an even larger amount lost money when the stock fell back down to its true fundamental value. Trevor Salata, a current Michigan Tech student, goes over what happened in this week’s video

Michigan Tech Husky Investment Tournament Spring 2021—Week One

Michigan Tech’s beautiful campus in Houghton, Michigan, is beautiful in all four seasons—come visit us!

Welcome to week one of the Husky Investment Tournament! Teams from India, Georgia, California, Virginia, Maryland, and Michigan are joining the experience. Ready to get started?

Let’s start by comparing two people and their investing habits, assuming a seven-percent annual return on the stock market:

Beth starts investing at the age of 18 and contributes $2,000 a year until she reaches age 40. Beth’s friend Jo waits to start investing until age 40 and contributes $5,000 each year until reaching age 60.

Who do you think will end up with more money at age 70?

Beth would have contributed $44,000 of her own money and by the time she reached age 70, there would be $531,950.70 sitting in her investment account. On the other hand, her friend Jo would have contributed $100,000 and there would be only $403,221.69 sitting in an investment account. 

This example illustrates the power of time and compound interest. If you were to start at age 18 to achieve millionaire status by age 60 you would need to invest $4,335.91 a year. This number equates to $361 a month or roughly $90 a week!

As Albert Einstein once said, “Compound interest is the eighth wonder of the world. He who understands it, earns it. He who doesn’t, pays it.” 

The College of Business at Michigan Technological University wants you to understand the basics of stock investing now, while you’re young. People naturally avoid things they don’t understand. We want you to understand that investing isn’t as complex as it may appear. In the Husky Investment Tournament, only one team will finish in first place, but all of you can win in the retirement tournament.

This week’s video is from Dean Johnson, dean of the MTU College of Business. He provides an introduction to stocks and investing to help get you started, as well as an explanation of rules and trading restrictions.

Good luck, and have fun!