Army Vet Embraces TVA Investment Challenge

When U.S. Army vet Brad Clark returned from his tour of Iraq, he met a new challenge: the TVA Investment Challenge. He was up for the mission, and helped lead a team to a 34.5% return on investment, more than 2% over the S&P 500—and found a dream job working for the Pacific Investment Management Company.

Brad Clark began his professional career serving his country on a tour of duty with the U.S. Army in Iraq. Growing up in the hills of Oak Ridge, Tenn., he knew about the Tennessee Valley Authority from school. However, he never envisioned that, after returning to civilian life, he would participate in a TVA program that would give him real-world experience and help him land the job of a lifetime—working for Pacific Investment Management Company, or PIMCO, a global investment management firm with over one trillion dollars in assets under management.

Students who participate in TVA’s Investment Challenge Program (ICP) actively manage real portfolios for TVA by designing and implementing long-term investment strategies under the guidance of their professors and within TVA’s guidelines. In the Spring of 2013, Clark’s ICP team at the University of Alabama Huntsville (UAH) constructed a portfolio that delivered a strong 34.5% return for the calendar year, beating the return of the S&P 500 by over 2%.

Here, Tammy Wilson, TVA Vice President, Treasurer, and Chief Risk Officer, caught up with Clark—PIMCO associate in the Institutional Business Development group and 2013 TVA Investment Challenge alumnus—to capture his thoughts on the ICP and how it primed his career.

First and foremost, thank you on behalf of everyone here at TVA for your military service. Since you discharged from the Army, how is your career developing?

I’ve taken my career from the sands of Iraq to the sands of Newport Beach, Ca., where PIMCO is headquartered. It goes to show you that with focus and hard work you can achieve your goals. For the past three years I’ve been working as an associate in the Institutional Business Development group for PIMCO. I am responsible for servicing the firm’s consultant relationships, and positioning PIMCO’s strategies to provide attractive solutions that meet their customer investment objectives.

Why did you choose a career in finance?

It was a discovery process. When I was discharged from the Army I thought I wanted to keep doing what I trained for in some capacity, so I decided to pursue a career in intelligence. When I enrolled at the University of Alabama Huntsville (UAH), I took foreign language and international business classes thinking they would align well.

Everything seemed to “click” when I started taking accounting and finance courses. I quickly discovered that finance was an area where I exceled. When not in class, I was reading about and closely following the markets. So, I switched my degree to finance.

While seemingly different, I feel finance aligns closely to my original career goals. In finance, there is a lot of technology and detective work. I’m good at gathering bits of data; then stringing that data together into information. Once you get the information you can make sound business decisions.

What interested you about TVA’s Investment Challenge Program?

I heard about the ICP when I switched my major to finance. You didn’t have to participate in the ICP at UAH to graduate, but I saw the ICP as a smart career move. The program added real-world financial experience to my resume, setting me apart from other job seekers when I graduated. Unlike many college classes based primarily on textbook theory, the ICP allows you to put theory into practice with real dollars at stake.

Is there an ICP experience that stands out to you?

Just like in the Army, it takes an engaged team to find success with the ICP. Real money means there is real risk to evaluate. My UAH team gelled that semester, and we came together to develop an effective Excel-based screening tool. We used the tool very successfully to build a matrix and rank different companies. Think of it as the starting point in our investment process. I still use it today when making investment decisions.

Did the ICP help your career in any way?

The ICP definitely helped with my knowledge and understanding of how equity markets work. As far as my career goes, the knowledge and experience I gained from the program helped me hit the ground running when I was hired at PIMCO. For example, my team at UAH presented our stock picks and investment strategy to the UAH Capital Management Group, a collection of local investment professionals and business representatives including TVA.

The question-and-answer portion of the presentation was the hardest part because these professionals live the markets every day. We had to clearly articulate our decisions, supporting our views with suitable evidence. That experience is essentially what happens during any investment strategy meeting here at PIMCO. Every day we carefully look at our investment plans to ensure we provide maximum value for our clients.

Overall, I would say that the ICP helped me start contributing at PIMCO in a major way from day one. I believe ICP students have an advantage over other students—those who just took finance classes—because of the real-world, practical experience the program offers.

Anything in particular you want to tell students about the ICP?

I would tell students that if they have a chance to participate in the program, do it! Engage yourself 100 percent. If you are interested in investment management or a similar career, the ICP can prepare you for what you will be doing on a daily basis—it gives you an idea of how the job truly looks and feels. Plus, the program gives you the real-world financial experience to set yourself apart from your peers, who will be competing for similar jobs.

Ultimately, I think the ICP is a great program. It was truly one of the highlights of my undergraduate experience, and I appreciate TVA for giving me that opportunity.

2015 Investment Challenge Program Performance Awards

On April 6, 2016, TVA recognized the ten universities who outperformed the S&P 500 Index in 2015 at a dinner presentation in Nashville, TN. Eight of the ten universities that produced returns above that of the S&P 500 in 2015 were present to accept their award. Congratulations to the award winners!

Alabama A&M University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Mohammad Robbani and students from Alabama A&M University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Mohammad Robbani and students from Alabama A&M University.

Western Carolina University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Grace Allen and students from Western Carolina University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Grace Allen and students from Western Carolina University.

Middle Tennessee State University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Kevin Zhao and students from Middle Tennessee State University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Kevin Zhao and students from Middle Tennessee State University.

Austin Peay State University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Professor Mike Phillips and students from Austin Peay State University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Professor Mike Phillips and students from Austin Peay State University.

Belmont University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. John Gonas and students from Belmont University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. John Gonas and students from Belmont University.

Tennesssee Tech University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Alma Hales and students from Tennessee Tech University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Alma Hales and students from Tennessee Tech University.

The University of North Alabama

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Kristy Van Rensselaer and students from the University of North Alabama.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Kristy Van Rensselaer and students from the University of North Alabama.

East Tennessee State University

Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Bill Trainor and students from East Tennessee State University.
Bill Johnson, TVA President and CEO, John Thomas, TVA CFO, and Tammy Wilson, TVA Vice President and Treasurer, with Dr. Bill Trainor and students from East Tennessee State University.

The New Home of TVA’s Investment Challenge Program

Welcome to the all-new online headquarters for TVA’s Investment Challenge Program. This site will henceforth be the hub of activity for students and teachers participating in the program. We’re glad you made it!

Forum

Once you’ve registered an account as a participant, you can fully utilize the forum space and school-based groups to share information and build strategies with your team.

Groups

Each school gets their own private forum, but the team here at TVA will be actively following all thread activity. The more engaged you are, the more you’ll get out of your Investment Challenge experience! We’ll be keeping an eye out for enthusiastic contributors.

Profiles

Each student is encouraged to fill out their online profile, including uploading your resume and adding a link to a personal website or portfolio. Add your friends. Post a status. “Like” an article— help us build a thriving community to help each other get the best results on this journey.

Get Competitive

While we encourage sharing information and supporting each and every participating member, in the world of finance there are clearly defined winners and losers. So put on your game face and together let’s take home the gold. No matter what happens in the end, we will all have gained new knowledge and experience along the way.

Happy trading.

TVA Invests in Futures‚ One Student at a Time

When you think of professional money management, the image that comes to mind may be expensive suits on Wall Street. But here in the Tennessee Valley, a new class of investor is being cultivated: young, smart business students from 25 universities in TVA’s seven-state service area—a group that regularly outperforms the S&P 500.

Student investors in the Tennessee Valley are young, smart and— through TVA’s Investment Challenge Program (ICP)— have outpaced the S&P 500 since the program began in 1998. Next month, TVA will recognize these student investors at a ceremony in Nashville, Tennessee, where the company will announce which team earned ICP top honors.

“TVA’s Investment Challenge Program provides real-world, hands-on financial asset management experience that can’t be simulated in the classroom,” says Dr. Kristen Van Rensselaer, professor of finance at the University of North Alabama, who was one of the founding ICP professors and has been a program coach for nearly 18 years.

K Van Rensselaer TVA Investment Challenge

Dr. Kristen Van Renssalaer Holds the ceremonial check from 1998 when TVA presented seed money to begin the Investment Challenge Program at the University of North Alabama.

The ICP began when universities and TVA came together to look for ways to enhance business programs at the university level.

For many college investing courses, students pick and track stocks only through simulated portfolios. Some students take these investing exercises seriously, while others do not because there is no “real money” in the game.

“We asked TVA to help us take our business curriculum and students’ experiences to the next level,” Van Rensselaer recalls. “We needed to develop a program that would apply real-world pressure on our students, and TVA made it happen.”

Students who participate in the ICP actively manage real portfolios for TVA by designing and implement long-term investment strategies under the watchful eyes of their professors while following TVA’s guidelines. The money students invest sits in TVA’s Asset Retirement Trust Fund.

“The ICP is a natural fit that benefits both students and TVA,” says TVA vice president and treasurer Tammy Wilson. “The program is a smart TVA investment strategy that diversifies the financial management of the trust fund, while giving students a ‘wow’ moment to develop the skills needed to compete in the workforce.”

Van Rensselaer remembers how her students agonized and debated for weeks over which stocks to buy or sell. “We were looking at adding company X or company Y to our portfolio,” says Van Rensselaer. “Students researched each company and presented reports similar to what any CEO would expect in a board meeting. I was amazed how detailed and professional the analyses were.

“While students only manage a small portion of the trust fund, the experience they receive is priceless,” she continues. “They treat the ICP as if they are managing the client’s entire investment portfolio, and, more importantly, they say they are proud to manage money for the people of the Tennessee Valley.”

Not only do the people of the Valley benefit from the students’ hard work, so too do the business schools students attend. Similar to professional money managers, universities that outperform the S&P 500 are eligible to receive up to 20% of the money earned with a total cap of 2% of funds under management.

Student teams have earned nearly $1 million in performance awards for their schools over the life of the program—awards that universities use to purchase research tools, enhance classroom facilities and/or seed student scholarship funds.

Participating ICP universities are: Alabama A&M University, Austin Peay State University, Belmont University, Christian Brothers University, East Tennessee State University, Lipscomb University, Middle Tennessee State University, Mississippi University for Women, Mississippi State University, Murray State University, Tennessee State University, Tennessee Tech University, Trevecca Nazarene University, Union University, University of Alabama at Huntsville, University of Kentucky, University of Memphis, University of Mississippi, University of North Alabama, University of Tennessee at Chattanooga, University of Tennessee at Knoxville, University of Tennessee at Martin, Vanderbilt University, Western Carolina University and Western Kentucky University.

Student Investors Produce Solid Return for TVA in 2014

KNOXVILLE, Tenn. – University students in the Tennessee Valley Authority’s Investment Challenge Program produced a double-digit return on their stock portfolios for the federal corporation in 2014.

“The students exercised diligence and responsibility managing their investment portfolios,” said TVA Vice President and Treasurer Tammy Wilson. “They produced solid results for TVA and gained valuable experience for what we hope will be rewarding careers within TVA’s service territory.”

The return for the total program, involving student teams from 25 colleges and universities in the seven-state TVA service area, was 10.53 percent. Three teams exceeded the Standard & Poor’s average and will receive performance awards. The winners and their returns on investment are:

  • Austin Peay State University, 22.67 percent
  • University of Kentucky, 17.83 percent
  • Alabama A&M University, 16.33 percent

TVA’s Investment Challenge Program is a partnership between TVA and the universities that provides a unique hands-on experience in financial asset management for the students and performance-based awards the universities can use to enhance their business school resources.

Student teams actively manage real stock portfolios for TVA, designing long-term investment strategies and selecting investments under the guidance of faculty members and within investment guidelines established by TVA.

Thousands of students have participated in the program since it began in 1998, and a number of them have been hired by TVA and other employers in the region after graduation.

TVA initially provided $1.9 million from its long-term asset retirement funds to start the program. Through 2014, the program has grown to over $13 million.

The other participating universities are: Belmont University, Christian Brothers University, East Tennessee State University, Lipscomb University, Middle Tennessee State University, Mississippi State University, Mississippi University for Women, Murray State University, Tennessee State University, Tennessee Tech University, Trevecca Nazarene University, Union University, University of Alabama at Huntsville, University of Memphis, University of Mississippi, University of North Alabama, University of Tennessee at Chattanooga, University of Tennessee at Knoxville, University of Tennessee at Martin, Vanderbilt University, Western Carolina University and Western Kentucky University.

The Tennessee Valley Authority is a corporate agency of the United States that provides electricity for business customers and local power distributors serving 9 million people in parts of seven southeastern states. TVA receives no taxpayer funding, deriving virtually all of its revenues from sales of electricity. In addition to operating and investing its revenues in its electric system, TVA provides flood control, navigation and land management for the Tennessee River system and assists local power companies and state and local governments with economic development and job creation.