The СƬƵ Golden Flash Asset Management (GFAM) Group finds itself in a unique learning environment as group members collaborate remotely to actively manage stock portfolios during social distancing orders related to COVID-19.
The GFAM Group, comprised of more than 30 undergraduates and eight graduate students in the College of Business Administration, provides participants an opportunity to manage assets across four separate accounts.
According to GFAM faculty advisor Steve Dennis, Ph.D., Firestone Chair for Corporate Finance at the College of Business Administration, the group’s five senior officers with the mentorship of faculty advisors have taken over fund management since social distancing started several weeks ago. The group closely monitors day-to-day operations of the funds and makes rebalancing trades each Friday.
The group first started preparing for ramifications of COVID-19 in late January, taking the initiative to outline the concerning exponential growth rate of confirmed coronavirus cases in its periodic economic reports.
“The effect of COVID-19 on our portfolio was not unexpected, as we saw the effect of COVID-19 on China’s economy in February ,” said senior finance major Vasya Yakimenko, Chief Economist of GFAM.
By the first week of March, stock markets had endured a major sell-off, and the group began to see consistent negative returns in its holdings.
“That is when we realized it was just the beginning, and we would need answers as to how we were preparing,” said senior finance major Sage Robertson, GFAM president.
Rising concerns over COVID-19’s spread and uncertainties surrounding the country’s response capabilities have caused U.S. markets to experience volatile fluctuations while generally trending down over the last six weeks. This led senior officers to execute multiple trades with the expectation of more to come as necessary. The group remains confident in its holdings and its collective ability to recover as it diligently works to mitigate value damages.
“We are closely monitoring our performance daily, along with looking into weightings of all sectors in the portfolio,” Robertson said. “We include all senior officers, all advisors, our graduate director and even two past senior officers on every email to keep them up to date. We will not be trying to time the market, but rather buying in stages every week. The most important thing to keep in mind is to not overreact. We have been slowly moving to our target weights while remaining calm.”
Following Yakimenko’s suggestion, GFAM also implemented a dedicated weekly COVID-19 newsletter to keep members updated on the pandemic and its corresponding impacts. The group is determined to demonstrate fiscal responsibility even given added challenges of an unprecedented health crisis.
“It is a tremendous learning experience and a rather challenging personal experience,” Yakimenko said.
Dennis, along with graduate fund co-advisor David Pelleg and undergraduate fund co-advisor Bill Billik, continue to provide guidance to GFAM officers as the situation unfolds.
“I teach them to remain calm when everyone else around you is panicking,” Dennis said. “If you can do that, you can be a great investor.”
“Students, especially the senior officers, have gained a once-in-a-generation learning experience of being at the helm at an asset manager during a major storm - while still being students,” added Pelleg. “As they enter the market, this puts them way ahead of their contemporaries - giving them a key advantage in the job market.”
Learn more about GFAM at /business/golden-flash-asset-management-team.
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Media Contacts:
Joni Bowen, College of Business Administration,jbowen1@kent.edu, 330-672-1279