A team from Union demonstrated their investment chops by winning the 2017 Adirondack Cup, a stock-picking competition for college students.
Organized by the Adirondack Small Cap Mutual Fund (ADKSX), the competition featured more than 160 students representing 22 schools and universities.
Beginning in October and continuing until April, teams were tasked with managing a hypothetical $1 million portfolio among five small cap stocks (defined as companies with market caps between $50 million and $3 billion). Students create a thesis on their picks, with industry diversification required. To encourage a long-term focus, teams are allowed to change their portfolio only once during the competition.
Union’s team posted an impressive 35.12 percent return during the contest, significantly beating the Russell 2000 Index, which measures the performance of small cap stocks in the U.S. The index posted an 11.13 percent gain for the period.
The team got a boost from an unlikely ally – the election of Donald Trump as president.
“One of its smaller positions, Health Insurance Innovations (HIIQ), a beneficiary of potential changes in the Affordable Care Act, nearly tripled in value,” said Greg Roeder, co-portfolio manager. Roeder works for Adirondack Funds in nearby Guilderland, N.Y., sponsors of the competition.
“The team employed a buy-and-hold strategy and mitigated risk by offsetting this pick with bigger, more stable, companies. They should be proud of their effort.”
Team leader Matt Kosicki ’17 said the competition gave students an opportunity to learn about an interesting area of the stock market that has many real-world applications.
“We got really lucky with HIIQ almost tripling during the competition, as we were betting on a Trump presidential win,” said Kosicki, an economics major from Chelmsford, Mass. “Although it was only 15 percent of our portfolio, HIIQ drove our portfolio to a commanding lead that we would hold for essentially the duration of the competition.”
Michael Gray ’18, an economics major from Wellesley, Mass., helped assemble the team. Union had participated in the early years of the competition, now in its sixth year, but took a few years off. Gray persuaded some students to enter last year, where the team finished in the top 10.
“This year, Matt discovered some stocks that ended up with great returns, and that helped lead us to victory,” he said.
The other team members were Toby Casper ’18, an economics major from West Hartford, Conn., and Peter Anastos ’18, an economics major from Concord, Mass.
Rounding out the top five finishers were Wesleyan University (24.28 percent return), Stonehill College (23.66 percent), University at Albany (22.39 percent) and St. John Fisher College (17.56 percent).
Other participants included Binghamton University, Bryn Mawr College, Buffalo State, SUNY Brockport, Clarkson University, SUNY Geneseo, Hofstra University, Ithaca College, Maria College, Nazareth College, Rochester Institute of Technology, The College of Saint Rose, St. Lawrence University, Siena College, SUNY Plattsburgh, Temple University and University of Wisconsin-Milwaukee.