Funding futures: the students financing ANU scholarships

There is little room for doubt when making stock market decisions.

When Gemma Saliba was preparing to present an investment proposal to the ANU Student Managed Fund (SMF) about the company she wanted the Fund to invest in – a packaging services company called Orora – there was reason for hesitation.

“They had some earnings release updates that were basically demonstrating the company was underperforming,” Saliba says.

Stock market changes can undermine months of work for the students involved in the SMF in a blink of an eye, requiring urgent emails to the course convenors and the fund’s investment advisory committee.

Compliance teams screen stocks for environmental and social impact, as well as potential reputational risks – such as mining or carbon-intensive industries, tobacco and firearms. If the stocks pass these screenings and the investment advisory committee approves the investment and the profits – hopefully – pour in.

Despite Orora’s underwhelming earnings, Saliba’s colleagues were still intrigued by the company. With deeper analysis, they noticed various factors that could turn things around: including a recent acquisition that could have swung either way, and the fact that one of their operating segments in the US was gaining market share.

“We actually felt strongly in support of Orora and that’s why we did, in the end, take it to the investment advisory committee,” Saliba says.

Harry Nielsen, who is currently the fund’s Chief Investment Officer, says that “the surprise was how quickly the stock reached the target the team had made”.

Dean Kastelas, senior lecturer and fund convenor, agrees. He says that the students’ price recommendation for the stock ended up being “ridiculously close” to an offer price placed by a private equity firm shortly after the SMF purchased stock.

“It’s still going up because hype around that stock in the market is just crazy,” Kastelas says.

“I think the rationale the team took was pretty spot on. It was out of favour, but they saw the promise in it, and so did others.”

Real-world money, real-world impact

At the SMF, successes like the Orora investment fund a good cause, with profits going towards an equity scholarship.

The SMF has a portfolio worth more than $910,000, and 4.5 per cent is distributed to the scholarship each year. Two students are currently supported by the fund’s profits.

“The more we can grow the SMF, the more we grow the scholarships that the University can disperse,” Kastelas says.

At most recent report, the fund delivered a 15.94 per cent return for the year to October 2024, beating the ASX 200 reference portfolio.

“We want to provide students with the closest experience to the industry as possible.”

Kurtis Castorina is in his first semester with the fund. He says the philanthropic impact of the fund changes how the students approach making investment recommendations.  

“It definitely makes you feel better when you realise that if you make some more profits, you can help fund someone’s scholarship,” Castorina says.

“It makes me more responsible, in the sense that if you don’t have confidence in your investment, then it is within your best interests to be humble about it and take a step back or even not go through with it.”

Nielsen agrees with this assessment.

“We’re all, naturally, prone to come in with a genuine interest in markets. But when you have a tangible stake with the fund, you don’t get that with another course where you are just learning theory and content,” Nielson says.

“We make decisions that use real-world money and have real-world impacts. I think, for the most part, having that intimate experience is something that enables our passion to flourish.”

Learning the ropes

Beyond financing scholarships, the fund is also an education tool with real world impact. Established in 2018, it’s a fully accredited course at the ANU College of Business and Economics.

Course convenor Hua Deng spent years juggling a PhD with a career as an equity analyst. She says the SMF was an excellent addition to her teaching portfolio. 

“When I started teaching, I found out in the classroom that the textbooks were still the same thing that I used 20 years ago,” Deng says.

“Of course, the task is much trickier and time sensitive compared with teaching a typical finance course. At SMF, we have surprises every day, all sorts of surprises, because it’s student led.

“We want to provide students with the closest experience to the industry as possible.”

For Saliba, gaining these industry adjacent experiences have been a game-changer.

“Being part of the fund has completely changed the trajectory of my career path and interests,” she says.

“As a commerce student, I always found markets, human behaviour and how they interact interesting, but getting that hands-on exposure and being able to invest a lot of time and be active in the process, I’ve realised where my passion lies.

“It’s gone from something cool to learn about to something I actually see myself doing now.”

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Find out more about the Student Managed Fund and how to support it here.

The Fund’s End of Semester Report is available here.