How UCT students manage investment passion with academic life

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SIMON BROWN: I’m chatting with Risi Mkhabela, corporate relations director at the UCT Investment Society. Risi, appreciate the time. You reached out to me on LinkedIn a little while ago. You said that your first quarterly report to the end of April would be out soon.

I have to say, in my day investment societies involved a couple of students and maybe a page or two of notes. This was a 100-plus page PDF document, and as good as I’ve seen.

Talk to me a bit about the society. How many members do you have? What is your day-to-day action there?

RISI MKHABELA: Thank you so much for having me on, Simon. Just to briefly speak about the Investment Society, we are a professional development society which is obviously geared towards the investment space.

In regard to our membership, we have roughly 1 476 members, with 24% growth from the previous year. This essentially makes us the largest investment society and student executive in South Africa, and we like to think the largest in the continent.

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SIMON BROWN: Certainly in South Africa, probably on the continent. How did you get that 24%? It is massive growth. What have you done over the last year to get a sudden influx of members?

RISI MKHABELA: Yes, definitely. I think, considering the growth we were anticipating a year-on-year growth maybe putting us in the 1 300 range. But given our acquisition strategy – we were quite aggressive in advertising the society and displayed it around the campus, obviously getting into contact with various lecturers and student departments just to kind of encourage students to get involved and join the society.

SIMON BROWN: The one thing what I do notice is you have different departments, different sorts of divisions headed up by different members. That perhaps is equally important because you’ve got Alternative Investments, you’ve got the Young Women Professionals part of it.

There are a lot of different themes within the broader structure.

RISI MKHABELA: Yes. The reason for that is we recognise that within the university landscape there are students from different disciplines, different interests.

It’s not only limited to investments, even though that’s the overarching theme for all of the portfolios.

So as you mentioned, we do have Young Women Professionals, as well as a Social Impact portfolio and a Professional Development Portfolio, which is obviously geared towards preparing students for the workplace.

But notably our largest portfolio is our Trading Club, which year on year has over roughly over 100 applications, and is quite competitive, considering that there are only 36 seats available in the Trading Club.

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SIMON BROWN: A student comes in, potentially a first or second year, and would spend a couple of years. This isn’t you’re in for a year and you’re out. You could stay as long as you are at UCT.

RISI MKHABELA: Yes. In my case, for example, I joined the society in my first year as an analyst in the Training Club, and then I progressed throughout the years until I reached obviously the corporate relations director on my senior year.

SIMON BROWN: The point is many of the members of the society, I imagine, are looking to go into the broader investment field, one way or another. Some might just be looking to go into accounting, maybe banking, but I imagine some are actually doing this out of interest and kind of going to use this as personal development, perhaps.

RISI MKHABELA: Yes, definitely. And just to touch back on the trading side, what we’ve seen is that it has a variety of different academic disciplines. So this ranges from your students in the commerce space, as well as engineering students and students in the science space, where many students are interested in the concept of investing and want to get some experience.

The Trading Club obviously trades with simulated cash, so it offers that opportunity for students to learn. The portfolio managers in that case will obviously be more senior students who have a bit more investing experience – but even they are eager to continue learning and understand portfolio construction.

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SIMON BROWN: Is it all simulated cash – this is more learning than it is about creating wealth?

RISI MKHABELA: Yes. Currently it’s all simulated cash. But a long-term ambition of the trading club has always been to eventually trade with real capital. This is in line with international standards. Fortunately we’ve had the opportunity to interact with international universities. This would be Oxford Alpha Fund,  who have their own student-managed investment fund as well as the Queen’s University in Belfast.

We’ve kind of understood their structure and are currently in discussions with the university now to introduce the concept of a student-managed fund trading with real capital.

SIMON BROWN: Okay. That would be absolutely epic. And how has it been? I said this was the quarter to the end of April. I have lived my life through many different quarters in the trading world. This was quite a wild quarter. How did you and your colleagues find it?

RISI MKHABELA: Given the geopolitical climate currently, it’s been a challenge for the portfolio managers. But I think considering that it’s simulated cash, more than anything it’s been a brilliant learning experience.

Actually last night we had the opportunity to go and do somewhat of a pitch at Ninety One’s offices to a few of the of their portfolio managers, and that was a brilliant learning experience for the portfolio managers. Obviously they were given various constructive criticism in regard to portfolio construction, stock picks and so forth.

Watch: WATCH: Ninety One Women & Investing Seminar, in partnership with Moneyweb

SIMON BROWN: As you’re talking about this, as I’m thinking about it, one of the biggest challenges must actually be juggling involvement with the Investment Society and your academic work, which of course you’ve got to be doing at the same time. And then you are at university, so you’ve a social life as well. It must take a ton of hours.

RISI MKHABELA: Yes, definitely. But as you mentioned before, we like to consider the Investment Society almost as a self-selecting model in the sense that the students who do join are students who want to be involved. Really giving up their time isn’t that much of a sacrifice, because this is what they they’d be interested in doing in their own free time.

SIMON BROWN: Yes. And from my experience, if you’re interested in markets and you’ve a passion for it, it actually is the fun part. It’s not the exams and the lectures. The markets are the fun part.

We’ll leave it there. Risi Mkhabela is a corporate relations director at the UCT Investment Society.

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