Students play with stocks for class credit
By John Ashley Menzies
Staff Reporter

More than a million dollars are in the hands of students who play the stock market for class credit, said Stan Block, a finance professor.

Students get a taste of the real business world by controlling $1.5 million in stocks for a class called the Educational Investment Fund that allows them to make real decisions with real money in a classroom setting, said Block, founder of the EIF.

“We feel we have an obligation to make sure the fund does well,” said Will Palmer, chief administrator and senior finance and accounting major.

Block started the student managed fund in 1973. The EIF began with a $600,000 gift from William C. Conner, former chairman of TCU board of trustees, Block said.

Students have to apply and are interviewed before they are allowed into the class, Block said. Only about 30 percent to 50 percent of applicants are accepted, he said.

There are 100 similar programs across the country, but TCU’s was the first program to be completely student-managed, Block said.

“The faculty is responsible to see they have the proper knowledge,” Block said, “but we are not directly involved in the decision-making.”

Block said a faculty member has never vetoed a decision in the program’s 30-year history.

The course itself lasts two semesters plus the time that the students spend with hands-on work, which is completely on their own time, said Larry Lockwood, EIF faculty advisor.

“(I) often see them there past midnight,” Lockwood said, “They’ll be there until housekeeping kicks them out.”

Palmer said students control a portfolio of stock and discuss decisions to buy, sell or hold on to certain stocks.

Former chief accountant Drew Flahive, a senior accounting and finance major, said the course is very peer driven with 30-minute question and answer sessions after students present reports about their stocks.

Since 1973, the fund has grown to $1.5 million. The EIF also has distributed $2 million to beneficiaries of the William C. Conner Foundation, Block said. The beneficiaries include the TCU general fund and the Baylor School of Medicine in Houston, he said.

Lockwood said the goal of the program is to maximize the educational benefits for the students and also to make sure the fund makes money.

“This is real money,” Lockwood said.

Flahive said the class was both challenging and rewarding. He said he would recommend it to anyone interested in going into investing.

“Members of EIF look out for you,” Flahive said. “It’s a lot like fraternities and sororities.”

Lockwood said the EIF out-performs many major firms from around the nation and regularly beats the average on funds.

“We try to develop the most well-rounded students in the nation,” Lockwood said.