Smith News 

Smith MBAs Win Seven-Month Asset Management Competition

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Smith Professor Wins Humboldt Award for Advancements in Mathematical Finance

The Humboldt award recognizes Madan’s advancements in the field of mathematical finance. His research focuses on improving the quality of pricing models, enhancing the performance of investment strategies, and advancing the understanding and operation of efficient risk allocation in modern economies. One of his greatest achievements is Madan’s Variance-Gamma (VG) model, developed with Eugene Seneta of the University of Sydney. It is one of only three pricing models used by Bloomberg news and analytics. The others are the Black-Scholes model and the Stochastic Volatility model developed by Steve Heston, Smith School assistant professor of finance.

Dilip Madan, recipient of a 2006 Alexander von Humboldt Research Award.

Madan will receive his award from the President of the Humboldt Foundation this July in Berlin, Germany. He will also attend a reception given by the President of the Federal Republic of Germany. The award carries a cash prize of 50,000 Euro, or about US$60,000 at current exchange rates.

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Students Augment Classroom Learning During Finance Roundtable Meetings

In addition to formal learning methods such as classes and seminars, Smith students also learn about finance through informal discussions. At the Finance Roundtable, first and second year students analyze the week’s corporate, financial, and economic news over a brown bag lunch. Sponsored by the Finance Association, the Roundtable spurs critical thinking in an unstructured environment.

The most recent Roundtable began with a discussion of the rising price of oil and theories on whether prices at the gas pump will follow. Next was a review of corporate news including the 10% decrease in the price of Google stock. Later, someone noted that there were more existing homes on the market than there had been in the past ten years. This initiated a long discussion on real estate, the impact of changing interest rates on homeowners, and how the secondary markets of Home Depot and Lowe’s would fare if home sales continue to decline. The session ended with a discussion of whether China is well positioned to compete in the auto market, perhaps as part of a joint venture with a foreign company. The value of the diversity at Smith was evident as Chinese students shared their insights on the business environment within their home country.

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Course Focus

BUFN 735 Computational Finance; (3 credits)
Introduces and applies various computational techniques useful in management of equities and fixed income portfolios, valuation of financial derivatives, such as stock options, valuation of fixed income securities and their derivatives. Techniques include portfolio Monte Carlo Simulation, binomial and Black-Scholes option pricing models, value at risk and stochastic processes.

BUFN 714 Advanced Financial Management; (3 credits)
Study of investment and financing decisions faced by firms at various stages in their life cycles. Topics include advanced capital budgeting and capital structure, real options and option-like features in securities, financial contracting, governance, financial distress, and capital-raising transactions ranging from IPOs for young firms to complex hedging strategies for large firms. Pedagogy uses mix of lectures and case studies.

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Club Focus

Finance Association

Finance Association Golf Outing

The Finance Association prepares students for finance-related careers in investment banks, corporations, investment management firms, commercial banks, consulting firms, and financial news institutions. The Finance Association helps students achieve their career goals through workshops such as mock interviews, resume reviews, and seminars on careers in finance. Other functions of the Association include arranging panel discussions to explore a variety of finance-related topics and networking events designed to help students meet professionals, alumni, and other students. Events for this year include internship and resume workshops, a trip to a networking event in New York, and a Speaker Series which attracts industry professionals who share their knowledge and experiences with current MBA students.

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Mayer Fund

The Mayer Fund was established in 1993 with a contribution from the College of Business and Management Foundation in order to achieve the superior returns that equity investments have historically provided. It is run by a select group of second-year MBA students at the Robert H. Smith School of Business who comprise a management team of two portfolio managers and ten equity analysts. Although the primary goal of the fund is to achieve capital appreciation, it is just as important that each member learns the processes by which investment decisions are made in a professional asset management setting. Through appreciation and outside contributions, the Mayer Fund has grown to over $1.2 million. The fund's long-term performance goal is to outpace the appreciation of the S&P 500 on a risk-adjusted basis.

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Name: Ioan Mihaltan (MBA 2003) Home country: Romania Undergrad Institution: Academy of Economics, Bucharest, Romania  Undergrad Major: International Business Summer Internship: ING Bank London, Corporate Finance Current Position: Raiffeisen Bank, Manager - Market Risk Department MBA focus: Finance Smith Activities: Vice President - Finance Association, Graduate Assistant - Finance Department

What are you doing in your current position? I am currently contributing to the development of a strong risk management-oriented culture in the local entities of my group. I am coordinating a project for market risk in the local branch; I am also working on the implementation of other risk measurement methodologies locally (risk cost, risk-adjusted performance). Why did you choose Smith? Coming from a foreign country I was looking for an MBA program with an international flavor. I was also looking for a program that was highly ranked by various publications. Last, but not least, the cost-benefit analysis was important in the decision making process. Considering these, the decision was easier than expected: MBA @ Smith. Any advice for prospective students? Smith MBA is a very positive experience, which includes the classes, but also all that happens outside the classes throughout the day. There are many opportunities at Smith - interaction and networking play an important role in grabbing them. Return to the top

Name: Sheilah Bradley (MBA 2006) Hometown: Cornwall, NY Undergrad Institution: George Washington University, Washington DC Undergrad Major: Finance & Sports Management Summer Internship: America Online:  Manipulated data in Hyperion to confirm monthly P&Ls, five-year budget outlook, and submission of forecast, actual and metric data for Digital Services growth division. MBA Focus: Finance Smith Activities: Co-President – Finance Association; Peer Coach - Office of Career Management; Graduate Teaching Assistant

Why did you choose Smith? The top two reasons for choosing Smith were the location and the value. Additionally, I think the Road to Smith Weekend solidified my decision when I was able to interact with current students, administration, and other prospective students. I felt so welcome, challenged, and that Smith was the place for me. I still do! Which of your finance classes have been most helpful to you and why? Advanced Financial Management practically applied many of the concepts we learn and will be useful in my career. Financial Statement Analysis used company annual reports to apply the concepts. I walked out of this class feeling so much stronger in reading financial statements and it is a great complement for anyone with a corporate finance focus. What do you hope to do after graduation? I hope to work in corporate finance in a media company, but we’ll see! Return to the top

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The process of MBA exploration can be quite overwhelming. The amount of information that is now available in print and electronic format seems endless, and the task of choosing three to five schools from the hundreds that are available can be daunting. To ensure that you are pleased with the results at the end of the process, may we recommend that you follow the advice of a wise man who wrote "to thine own self be true."

In essence, program exploration should actually begin with self assessment. You must ask yourself many questions: What are my goals? Why do I want the MBA? What are my expectations of an MBA? Is this the appropriate time to pursue an MBA education? In what type of environment or culture do I thrive best? With what type of people do I enjoy working? Is program size important to me? Is collaboration important to me, or do I thrive best on individual competition? How important is community service? Social causes? Innovation? In what type of city do I prefer to live? Is ethnic and geographic diversity important to me? How much can I afford to spend on an MBA? Where do I want to live post-MBA? Will the school assist me in finding work in this location?

Answering these questions (and a few others), will allow you to create a blueprint or profile of your "ideal" school. You can then begin the research process. Do not limit your research to websites and program brochures. Instead, talk to the people who are affiliated with the programs that interest you. Visit the campus. Meet with staff and faculty. Sit in on a class. Talk to students and alumni. Get a "feel" for the community, the values and the vision of the school. Although your original list may number 10 to 20 schools, by the end of the assessment and exploration process, you will most likely narrow the pool to three to five schools where you will thrive.

To get you started in exploring Smith at "the next level," here's a formal invitation to VISIT US!!! Our half-day Visitors Program includes a class visit, lunch with students, a tour of Van Munching, and a workshop with members of the admissions professional and student staff. We also offer "Beyond the Classroom" experiences. Information sessions for students interested in our part-time program will begin in the fall. Registration for these events can be found at http://www.rhsmith.umd.edu/fullmba/visitus.html#visits_with_vibe.

Two other events will be offered in the Fall of 2006 for students from traditionally under-represented MBA groups - the annual Women and the MBA symposium and Kaleidoscope: Advancing Diversity@Smith. Both of these daylong workshops are designed to introduce prospective students to MBA programs, the application process, financing the MBA, life as an MBA student and the Smith community.

If you can't visit us, we invite you to participate in one of our quarterly chats. Chatting is a fun and convenient way to gather information and insight into the Smith community. Most of our chats include representatives from our student body, career services office, admissions office and student affairs office.

Finally, we also offer you our students "electronically." The MBA Admission Ambassadors (The viBe), are accessible by e-mail and are willing and ready to address your questions about the school, faculty, curriculum, environment, geographic location, or any other point during your data gathering and/or decision making stage. Contact them at vibe@rhsmith.umd.edu.

Here's to seeing you at Smith!

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