A five-student team from FIU Business was the runner up in the Florida regional competition of the 2018 CFA Research Challenge, facing off against students from 16 universities around the state. The CFA Research Challenge, which extends globally, offers university students real-world experience in equity analysis, complementing the more theoretical academic structure.
“We worked as if we were true financial analysts,” said Mercedes Zhang, the FIU team leader for the competition and co-founder of the Alternative Investment Insight Group (AIIG) at FIU, the first student-run alternative investment group in the state of Florida.
Throughout the competition, students work in teams to research and analyze a publicly traded company, selected by CFA, and each team writes a research report on their assigned company with a buy, sell, or hold recommendation.
The FIU Business students’ assignment: Harris Corporation, a U.S. technology company, defense contractor and information technology services provider. Harris produces wireless equipment, tactical radios, electronic systems, night vision equipment and antennas for use in the government, defense and commercial sectors.
They analyzed the company’s valuation and, examining its debt ratios, presented cash flow models, investment risks and growth assumptions. Ultimately, they developed an investment thesis based on this research.
“The students worked really hard on the report and their presentation skills and were rewarded with great statewide exposure, gaining valuable practical experience,” said Mark del Pezzo, finance and investments instructor and the team’s advisor. “FIU has competed many times over the years and this is the first time our team places this high in the competition!”
Comprised of four undergraduates and one MBA student, the FIU team spent several weeks working on the written report and presentation.
“We had to look at everything more in-depth because the company operates across various sectors – engineering, industrial and aerospace,” said Zhang, currently an Equity Research Intern at Fairholme Capital Management who expects to graduate in Spring 2019.
Juggling class schedules, jobs and lives.
“The report was very technical; it required a lot of research and analysis,” said Renato Danieletto, a junior majoring in finance and economics and a co-founder of AIIG at FIU. “There were a lot of late nights at the lab.”
In addition to Zhang and Danieletto, the FIU Business team included Eli Carrazana, Jason Keasler and Rafael Sanz. All are also active in the school’s Student Managed Investment Fund and the Phoenician Investment Fund, student-run initiatives where members participate in simulation-based finance and investment activities ranging from equity research, investment banking, securities trading, and asset valuation, among other activities.
Would the team tackle the CFA Research Challenge again? Definitely.
“If you can, do it. Applying what you learn is more hands-on than learning from a book,” said Danieletto. “Start early, get organized and reach out to industry experts or advisors.”