SMILE Fund makes it six in a row

It has quickly become an annual rite of spring: Flowers blooming, birds chirping, SMILE Fund students carrying the day.

For the sixth straight year, the University of Tennessee at Chattanooga SMILE Fund (Student Managed Investment Learning Experience) team was victorious at the Chartered Financial Analyst Institute Greater Tennessee Research Challenge.

The CFA Institute Research Challenge, which first took place in 2002, is an annual equity research global competition that provides hands-on mentoring and intense training in financial analysis and professional ethics.

University students from around the world, in teams of mostly graduate students—as opposed to the UTC all-undergrad squad—analyze a company’s financial strength, document it in a professional research report and submit their findings to a panel of judges. In the process, they gain real-world experience as they assume the role of a research analyst.

The SMILE Fund team of Gary W. Rollins College of Business finance majors Luke Johnson, Nicole Brill and Logan W.E. Painter will now compete in the sub-regional round, which consists of winning groups from the local competitions across the Southeast producing a recorded video for a different set of judges. The UTC trio has submitted its video for this round, with results being announced on March 30.

Johnson is the SMILE Fund’s president and Painter is the vice president of risk management. Brill, the healthcare team chief analyst, will be the SMILE Fund vice president of operations during the 2022-2023 academic year.

“There was a lot of pressure, but the amount of hours our team put in really took away a lot of nerves,” said Johnson, a junior from Signal Mountain and the captain of this year’s squad. “When we found out we won, it was really just the cherry on top.

“The next couple of weeks will be a lot of waiting. I can guarantee that if we advance, we will address all of the critiques of our presentation and work as hard as we need to in order to get past the next round.”

Teams who advance beyond the sub-regionals will compete in the regional semifinals on April 7-8.

The SMILE Fund trio analyzed Tractor Supply Company (NASDAQ: TSCO), the largest rural lifestyle retailer in the United States.

“In a post-pandemic environment, looking for safe investments is on everyone’s mind,” said Painter, a senior from Smithville, Tennessee. “Tractor Supply has a long history of consistent growth and is seen as a specialty retailer, making us wonder how they have been able to be so consistent—even in rough times—in the consumer discretionary sector.”

Hunter Holzhauer, a Robert L. Maclellan and UC Foundation associate professor of finance and director of the SMILE Fund, said the trio “knew the company so well that Tractor Supply was popping up in their dreams.

“I’d like to brag about their teamwork, their commitment and the quality of their analysis,” Holzhauer said. “However, I’m most proud of the way they have represented UTC, the Rollins College of Business and the SMILE Fund. These three students are special.”

The students also were guided by industry mentor Ray Ryan, president, CEO and portfolio manager at Patten and Patten, Inc., a Chattanooga investment advising firm.

Painter, who interns at Patten and Patten along with Johnson, described the competition as “the greatest test of my knowledge since birth.”

“I applied everything I learned from my classes, from my experience and mentors in the SMILE Fund, from my job and mentors at Patten and Patten, and even what I learned outside of these experiences going all the way to my day-to-day life,” he said.

Brill, a junior from Mount Juliet, Tennessee, who will intern at the Nashville investment firm Alliance Bernstein this summer, echoed those sentiments.

“Participating in this competition has allowed me to be challenged and grow in my abilities as well as expand my knowledge,” she said.

How large has the Research Challenge grown since its inception? According to the CFA Institute website, more than 900 universities and 5,000-plus students worldwide—representing 91 countries—participated in the 2021 competition.

“The CFA Research Challenge has been an incredible learning experience,” Johnson said. “We were pushed to produce a report and presentation that is typically not expected from undergraduate students. It was difficult at times, but my great teammates and mentors allowed me to push through and keep working.

“I also believe that our team’s experience and knowledge from the SMILE Fund gave us an edge over our competition. Since we are now the sixth consecutive winning team from the Rollins College of Business, I think it is safe to say that this college is unique in its capability to produce outstanding educational results.”