For IIT Stuart School of Business graduate finance student Yuming “Gary” Hou (M.S. FIN ’14), one commodity always seemed scarce this past school year—time. As executive director of Stuart Investments, a student group that invests a portion of IIT’s endowment to give students real investment experience, he was helping to manage a portfolio of stocks valued at a half-million dollars. Hou was also spending dozens of hours each week working on IIT’s submission for a prestigious international finance competition, all while trying to juggle demanding coursework and an internship.
“I slept probably only four to five hours a night during that three-month period,” Hou says. “But it was a great experience and worth it.”
Hou had studied computer science as an undergraduate in his native China and had come to IIT because of the school’s strong quantitative finance program, where mathematical models and computational tools are applied to financial analysis. But after hearing about Stuart Investments during Orientation Week, Hou joined the group to gain experience with fundamental analysis, in which multiple economic factors are examined for their potential effect on markets. He says it was a constant challenge to switch between his coursework and Stuart Investments because quantitative analysis and fundamental analysis require vastly different mindsets.
“Initially I focused more on the quantitative side because I thought I was good at that,” Hou explains. “But as I got to know more about fundamental analysis, I felt like my real interest became about combining both.”
Under the guidance of Michael Rybak, senior lecturer of finance, Hou and dozens of other graduate and undergraduate students in Stuart Investments scrupulously researched which stocks to purchase, tracked the stocks’ progress, and calculated the return on investment. Hou is credited with helping the portfolio’s valuation to nearly double in size from the initial $250,000 investment of IIT’s endowment.
This year Hou was among five students selected to represent IIT at the CFA Institute Research Challenge. The annual competition invites university students from across the world to test their financial-analysis skills and their ability to evaluate stocks. Drawing upon many of the same skills they developed at Stuart Investments, the IIT team members impressed the judges and secured a first-place finish at the regional level, beating a select group of Chicago-area universities. Hou and his teammates then had the opportunity to compete at the national level in Denver this past March. Although the team did not move on to the international competition, Hou says the CFA Challenge and Stuart Investments have been invaluable opportunities to develop his financial analysis skills. He also credits these experiences with helping him find his real interests within the finance industry and hopes to find a job where he can tap into both the quantitative and fundamental analysis sides of his mind.
CFA Institute Research Challenge: www.cfainstitute.org/societies/challenge