UM-Dearborn Investment Challenge caps yearlong financial literacy program

The Investment Challenge, sponsored by University of Michigan-Dearborn’s College of Business and Crain’s Detroit Business, was a web-based, simulated stock investment and trading competition. Participants managed a $1 million mock portfolio, competing to win $2,500 in cash prizes each quarter.

“The Investment Challenge provided participants valuable hands-on learning experiences in managing stock investments for their personal finances,” said Hei Wai Lee, professor of finance and director of international programs. “In the process, participants learned about how global economic conditions, as well as industry and company-specific events, impact the stock market and the performance of their stock portfolios.”

The Challenge, which was free and open to the public, received nearly 950 entries throughout the year. Participants included students, alumni, community members and business people whose investment skills ranged from beginner to advanced.

“This game has given me confidence,” said Mark Sadowski, a UM-Dearborn graduate (’97, B.B.A/B.A.) and quarter four (Q4) winner. “It is a very hands-on learning experience. In time you learn, and you can supplement your income. This has changed my life.”

Sadowski, who spent years in the trucking industry before a hereditary heart condition placed him on disability, planned to use his winnings to invest in real stocks.

Winning portfolios were determined by overall and risk-adjustment (Sharp Ratio) rate of return.

Winners included Brent Noh (Q3, overall and Sharp Ratio), Sadowski (Q4, overall), Scott Reed (Q4, Sharp Ratio) and Jim Baubie (Q1, overall and Sharp Ratio). Q2 winners have not yet been announced.

The College of Business’ Betty F. Elliott Initiative for Academic Excellence provided support for the competition. Each year, the multi-disciplinary program focuses on a topic critical to the economic growth of the Detroit region and the state of Michigan. The theme for the 2011-12 academic year was financial literacy.

Other initiatives of the program included the Elliot Scholarly Research Award on Behavioral Finance and Investments, awarded to Henrik Cronqvist of Claremont McKenna College and Stephan Siegel of University of Washington; the Elliott Doctoral Dissertation Support Award on Behavioral Finance and Investments, awarded to Chunmei Lin of National University of Singapore; FIN 200: Personal Finance, a course for the Bachelor of Business Administration; and the Betty F. Elliott Lecture Series on Business and the Future, two symposiums on global economic outlook that more than 200 guests attended.