Melissa Mueller doesn’t make a big fuss out of being the first female president of the SMILE Fund in the Gary W. Rollins College of Business.
“I’ve always been one of the guys,” she said. “Being president means a lot, but I didn’t see it as a hurdle to jump over.”
Ask her about potentially being known as the fund’s top-performing president, though, and a huge smile appears.
“Oh yes, it’s insane,” Mueller said. “When we were able to check how we were doing against our benchmark, it blew our minds. We were expecting to be outperforming it a little bit, but not by 8%.”
Created in 2015, the SMILE Fund—Student Managed Investment Learning Experience—provides select University of Tennessee at Chattanooga undergraduates the opportunity to manage real money in a real stock portfolio for an actual client, the UC Foundation. SMILE Fund managers make real-time stock investment decisions and are expected to meet or exceed their benchmark, the S&P 500 Index.
“The fund itself is more of a long-term fund. We liked that the previous officer team had moved in a more defensive position, and that’s what my officer team and our group wanted to continue,” said Mueller, who came to UTC thinking she would go into financial planning but, thanks to the SMILE Fund, the senior intends to pursue a career in research and analysis.
On June 30, the end of the second quarter, the SMILE Fund was outperforming the S&P 500 by 5.84%. By mid-September, that figure was hovering between 8-9%.
“Even though we’re in a pandemic, the fund is currently on pace for its best year ever,” said Hunter Holzhauer, Robert L. Maclellan and UC Foundation associate professor of finance and the SMILE Fund faculty director. “We are beating the benchmark while taking on less risk. That’s a huge win in my book.
“The students purposely dialed back the risk, expecting some turbulence in the market, which usually means you get a lower return. But when this all hit, we ended up being the beneficiaries because we had a higher return with less risk, something very difficult to do,” he said.
Instead of taking the summer off, SMILE Fund officers voluntarily met every week via Zoom. They also did a presentation for the fund’s professional advisory board in July, something not previously done during the summer months.
“We wanted to make sure that we were confident in our ability to manage the funds,” said Jacob Snook, the SMILE Fund’s vice president of market analysis.
A senior majoring in finance, he is one of the veterans of the group, having joined the SMILE Fund in the fall of 2018.
“The thinking behind it was if we stay on top of things and make some active decisions, we can do really well. We could prove to the UC Foundation that we know what we’re doing,” he explained.
The SMILE Fund’s annual recruiting season is taking place through mid-October. Holzhauer said fund members have come from all over the UTC campus, including students majoring in English, creative writing, engineering and computer science. The requisite requirements are that students are interested in investment, want a hands-on experience and are ready to put in the work.
“The SMILE Fund isn’t just about how this can benefit finance majors. It’s about how we all can become better, well-rounded business people,” said senior marketing major Alex Varner, the fund’s vice president of marketing. “So for me, as a marketer, it’s about understanding other aspects of the business and making myself stand out a little more than other marketing people.”
Holzhauer pointed to the internships that Mueller have recently landed in saying that SMILE Fund students are getting the best internships in town. Mueller is interning in financial services at TVA, and Snook is a research analyst at Acumen Wealth.
“Now more than ever, it’s important to be involved in an organization like the SMILE Fund because you can’t just apply for jobs or internships without any experience,” Snook said.
“You have to have some connections, and that’s what the SMILE Fund provides. We have tons of training and tons of networking opportunities with professionals in the area.”