University students across the Tennessee Valley Authority's service territory delivered positive returns through the federally owned utility’s Investment Challenge Program in 2016.
“The markets gave investors some interesting dynamics to navigate in 2016,” said TVA Vice President, Treasurer and Chief Risk Officer Tammy Wilson. “Our ICP students demonstrated sound financial discipline in their portfolio management to once again deliver solid results for TVA and the people of the Tennessee Valley.”
In 2016, ICP students collectively earned an 8.3 percent return on their investments. Nine student teams produced strong, double-digit returns in 2016, four of which outpaced the S&P 500 on the year. Teams that outperform the S&P 500 in a calendar year earn performance awards for their respective universities. Those universities that outperformed the S&P 500 in 2016, with their annual returns are:
• Trevecca Nazarene University, Nashville, Tenn. – 18.7 percent
• East Tennessee State University, Johnson City, Tenn. – 18.6 percent
• University of Tennessee, Knoxville, Tenn. – 16.7 percent
• Christian Brothers University, Memphis, Tenn. – 14.1 percent
The ICP is a partnership between TVA and 25 universities in the utility’s seven-state service area that provides a unique, hands-on experience in financial asset management where student teams can earn performance-based awards to enhance business school resources. Since the program was launched in 1998, students have earned more than $1 million in performance-based awards. Universities use performance awards to improve their business programs through infrastructure enhancements, scholarships and research subscriptions.
Student teams actively manage live stock portfolios for TVA, designing long-term investment strategies and selecting investments under the guidance of faculty members and within investment guidelines established and monitored by TVA. Students have collectively outperformed the S&P 500 total return of 5.67% by 15 basis points – a 5.82% return for the program since it was established.
More than 8,500 students have participated in the ICP since it began, and a number of them have been hired by TVA and other employers in the region after graduation.
Participating 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 State University, Mississippi University for Women, Murray State University, Tennessee State University, Tennessee Tech, 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.