MBA candidates to manage a real fund

A new program at the University of Houston, offered in partnership with Aim Management Group, will provide hands-on mutual fund management experience as part of the university’s MBA curriculum.

Starting next fall, employees at the Houston-based financial services company will seed a new, student-run mutual fund partly with their own money. The fund is open to all investors, but Aim expects the most interest to come from alumni and others interested in the university. Houston investment professionals will serve as academic advisers for the program.

The number of investors will be limited to 99, and the minimum investment will be $150,000. So far, investors have pledged between $1 million and $2 million, and officials expect that the total could reach $3 million by the time the fund is officially launched in August.

The students will work in a live trading room, complete with workstations and data connections from Bridge Systems, Bloomberg LP and Reuters Holdings PLC.

While Aim professionals will act as mentors, it will be the student fund managers who make all investment decisions, says Michael Cemo, president of Aim Distributors, who is spearheading the effort to improve financial services educational opportunities at the university. “Our people will serve strictly as faculty advisers,” he said.

“One major premise of community service is to try and improve local education,” says Mr. Cemo.

“The University of Houston is a very important institution in this city, with nearly 30,000 students. Nearly 400 of our employees are graduates, and four of our top money managers, who invest nearly $50 billion, are graduates.”

Rich Pettit, professor of finance at the university, will be faculty coordinator for the student-managed fund and handle the classroom work for the fund management course.

The course is structured to cover two semesters, focusing on stock selection, analytics, investment strategies and investment styles, says Mr. Pettit. It will include outside lectures from professional investment managers and analysts.

The fledgling portfolio managers will rotate through the class, so that about half of the students will be new and work alongside students who already have one semester under their belts.