Published: April 7, 2016
With its participation numbers swelling to record heights in recent semesters, PRISM, an acronym for Portfolio of Responsible Investments under Student Management, has come to be increasingly utilized by the underclassmen of the Kania School of Management to learn alongside their older counterparts about topics related to the financial markets. Under the leadership of its three current managers, PRISM is a student organization on campus where an actual portion of the school’s endowment is given for students to invest at their discretion to gain a hands-on experience.
“PRISM was built for students to get a hands-on learning experience with financial markets to understand the economy, current events and other factors affecting financial markets,” explained Senior James (Jimmy) Jencarelli, one of the three managers of the student-led fund. “We are a top-down analysis portfolio, where we look at the ‘big picture’ first,” before making a decision involving the fund.”
When it comes time for the club’s weekly meeting, the managers and other key figures, such as the chief economist, present on the portfolio’s performance, the latest financial news and any announcements related to KSOM. Following the preliminary presentations is a forum-like format, where the atmosphere becomes less structured and informal to encourage discussion and more involvement of underclassmen, who may not be as knowledgeable as their older cohorts in the beginning. During this period students make presentations, or pitches, to convince the club to buy a certain stock or sell one of the portfolio’s holdings, which is then voted on. By giving students nearly complete control over managing an actual fund, they gain tangible experience to assist them in learning key financial and economic concepts.
As an explanation of how the club comes to an investing decision, Jencarelli explained with an example involving the recent oil prices that have been affecting the economy as a whole.
“For example, we could look at cheap oil prices, then go further and see that people are saving money at the gas pump. From there, that means consumers have more money in their pocket which leads to them spending more money on retail goods, which could lead to a decision to find a company in the retail sector.” Following this deduction, the next stage is set into motion where the club membership then researches for companies that fit the criteria. If some promising businesses are found, some students can then form a team to craft a presentation to convince the rest of the club its value to the portfolio. If convincing enough, the students will vote to buy shares of the company’s stock, where its value will hopefully perform well in the future.
Even with the chances that PRISM offers to learn investments through tangible use, there are other benefits students also can achieve through active participation in the club. As Jencarelli explains through his own personal experience, PRISM can assist in receiving internship and job offers through the unique experiences it provides.
“There is no doubt in my mind that I would not be where I am today in terms of jobs and internships if it wasn’t for PRISM,” Jencarelli said of how the club was integral in him receiving his two internships and job offer.
“My first internship that I got… I basically at that point had very little business exposure. It’s very rare for a sophomore to get an internship. I was a bio/pre-med major freshman year so I had no business experience whatsoever.” The only reason he got his first internship, Jencarelli concluded, was because he had talked a lot about his involvement and interest in PRISM. “They really were impressed with what I knew and what the club offered.”
In addition to the advantage the club gives to students in their search for internships and jobs, something that many students may not be aware of, is the significance of having The University offer a club such as PRISM, at all, when compared to other schools. Jencarelli was very adamant in the importance of having such a club on campus by describing PRISM as “something that The University of Pennsylvania’s Wharton School of Business does not have…” He further described the rarity of PRISM’s concept at other schools by saying how Wharton has an investment club that invests paper money in place of actual cash. “We are investing real money from the University of Scranton’s endowment fund, and that’s a privilege that very, very few schools have. And furthermore, other schools… aren’t allowed to have the flexibility that we have.” the University students are able to buy bonds, stocks, hold cash and options, Jencarelli further clarified. In comparison, most other student portfolios at rival universities can only buy bonds and other simpler, safer assets.
Since PRISM is based around finance and even some accounting concepts, many students could feel rightfully intimidated about joining, especially when they are not a finance or accounting major. Despite the financial nature of the club, it is open to any majors and many members are different majors than the usuals that one would expect to populate the student organization.
“I think a lot of people get scared away awkward they are not taught on the financial markets in their respective majors,” Jencarelli responded when asked about other majors participating in the club. “But still, it’s not hard to learn about what’s going on in the economy and financial markets.” Alex Hoffmann, another leader of the portfolio and an electronic commerce major, proves that a student does not have to study the financial markets as part of his major in order to learn about them.
“All you have to is put some drive behind it, and really try to learn, and you’ll be fine,” Jencarelli assured when asked for advice on how to excel in PRISM.
Jencarelli also illustrated his role as a teacher and mentor of sorts, willing to sit down with individual students to teach them the basics of market fundamentals.
“One of my biggest jobs besides managing the portfolio… is really to teach students, the younger underclassmen, about financial markets and the economy so when I’m gone they can step in and they will be able to handle it.” By having upperclassmen such as Jencarelli willing not only promote student participation, but also to personally teach students what they may not learn in the classroom, PRISM offers an experience that few clubs on campus can compete with when it comes to preparing business students for the financial markets of the real world.
“When you get older, no matter what profession you are in… you’re going to want to know at least basics on how to invest,” Jencarelli explained when asked why it is important for all students of every background to know the basics of the market. “Everyone’s going to have a 401k, Roth IRA, etc… and if you don’t know how to invest your money properly, that’s really risky.”
Jencarelli concluded with advice for the students to step outside of their comfort zones in order to reach new heights of success.
“In order to be great at what you do, you often have to step outside of your comfort zone. There’s so many things that I’ve done that intimidated me. But I realized that if you have the mindset that you can succeed and you can do something, you can do it. It’s all in the mindset.”
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