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University of Tampa students taking stock of the future

By Susan Thurston, Times staff writer
In print: Friday, April 11, 2008

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If you lost money in the stock market last year, you might want to ask some college kids for their investment advice.

Business students at the University of Tampa won first place in a major college portfolio investment contest that rates students on how well their portfolio did and what risk they took.

Students in UT's applied investment management class manage a $100,000 portfolio donated by local philanthropists Ron and Beverly Bailey to help teach them about Wall Street. Like real traders, they decide which stocks to buy and which ones to ditch.

So far, they've done quite well, outperforming the market even in tough economic times. Last year, the fund grew about $25,000, reaching a total of $150,000.

In recognition of UT's win at the eighth annual Global Student Investment Forum March 27 to 29, tbt* spoke with some of the class leaders about how they did it. Here are their best and worst stock picks and their predictions for the future.

Winners

Brazilian crude oil — With Americans eager to find oil from anywhere outside the Middle East, many eyes are turning to Brazil, where the economy is booming and the oil flowing. And, unlike other oil-rich places such as Venezuela, Brazil is more stable politically. The students bought stock in Petrobras, which is doing well.

Apple — The fact that nearly every person, college kid or otherwise, has an iPod or iPhone, is probably a good sign. The students bought this stock on a calculated hunch that the new iPhones would be a hit.

GameStop — Assuming that most everyone would want some type of video game, be it a Wii or Xbox, the students bought stock in GameStop before the Christmas rush. The stock did well over the holiday season, but the students recently sold it to have cash available for other trades.

Losers

Boeing — Delays in the deliveries of Boeing's Dreamliner jet caused a fast descent for the airplane maker's stocks. The students promptly sold their shares, for a loss.

Water resources — As communities continue to grow, the hunt for water intensifies, giving businesses involved in water rights, desalination and other water issues greater prominence. The students invested in a grouping of water-related stocks (PWO ticker) but sold the shares this year because they wanted a higher yield.

On the radar

Starbucks — What sleep-deprived college student wouldn't think coffee is a worthwhile investment? Now, the financial picture might justify it. The students say the java giant's release of its new "everyday'' blend might give the stock a jolt.

John Deere — Higher food prices and increased demand for ethanol and other corn-based products could mean more business for John Deere, which makes farming equipment. Look for more college co-eds wearing the hip-to-be-country green T-shirts and caps with the yellow deer logo.

Capital One — More people paying with plastic could translate to more profits for credit-card companies, such as Capital One. But the students caution that reckless overcharging could come back to bite the companies if people can't make payments and the companies have to write off the debt.