For Kirk Weldy, a senior at Ashland University, watching the stock market for the last few days has been exciting and frustrating.
Weldy, a 2005 Archbold High School graduate, is a member of the university’s Eagle Investment Group. The student group manages about $600,000 of the university’s endowment.
With the Dow Jones Industrial Average, a stock market gauge, swinging wildly from above 10,000 points to just above 8,000 points, then back up more than 900 points on Monday, it’s a tough job.
As the market has gyrated, Weldy said Eagle Investment Group has been down almost 40%.
But, he said the group hasn’t taken “as big a hit as the Dow Jones.
“Losing money is very frustrating, but it’s a good experience to see how the market reacts,” he said.
The question everyone is asking, he said, is where will the stock market bottom out?
“Honestly, there’s a lot of uncertainty. Nobody knows what’s going to happen. I’ve talked to a lot of professors and stock brokers, and they’re frustrated right now,” he said.
“It’s been educational. It’s been pretty crazy. The biggest thing we’re talking about is there’s no certainty.”
There are many opinions on the cause of the stock market’s recent woes, but most tend to link the problems to sub-prime mortgages, mortgage loans made to those who could not make their payments.
Weldy said the current crisis in the stock market “has been compared to the stock market crash of 1929.”
But, “as bad as this was, it didn’t happen over a couple of days,” like the 1929 Crash.
“I think we’re headed in the right direction now,” Weldy said, citing both the U.S. Government’s $700 billion bailout, or rescue plan, and a similar plan being developed in Europe.
Eagle Investment Group is open to any Ashland senior fi- nance major. About 25 students are involved, working with “A” and “B” portfolios.
Students are given an area, or sector, of the economy to study. Weldy studies the health care industry.
Eagle Investment was started in 1999 with a $250,000 share of the university’s endowment.
Weldy said students meet on Monday, Wednesday, and Friday to talk over market strategies, but said some students study the market daily.
Thomas Harvey, an assistant professor of business administration and adviser to Eagle Investment, “does not make the decisions. We manage the portfolios,” Weldy said.
But, in the past few days, “he’s said a lot more than he normally does. We’re taking it day by day.”
Weldy, son of Kim and Karin, Archbold, is double-majoring in accounting and finance.
Right now, he said he’s leaning toward accounting, “because job security is an issue. But I would love to get into finance.”
He has one important trait for the business world- optimism.
“If you have any extra money, this is a great time to buy stock, at the all-time low,” he said. – David Pugh