Applied Investment Management (AIM) celebrates 20 years

Author: Christine Cox

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L-R: Paul Buser FIN '03, Jim Parsons
FIN '96 and Scott Malpass '84, MBA '86.

To hear Jim Parsons tell it, he owes his career success to a coin toss 20 years ago.

It was 1995, and three Mendoza finance experts — Frank Reilly, John Affleck-Graves and Scott Malpass — were about to launch an ambitious course. Applied Investment Management (AIM) would require top finance students — undergraduates in the fall and MBAs in the spring — to manage a live investment portfolio with actual funds from the University endowment. Further, the three professors had to commit to team teach each class period in addition to a long list of rigorous requirements.

And although Reilly, Malpass and Affleck-Graves had done extensive preparation and felt confident AIM would become one of the top investment courses in the country, they still looked at the scope of the project and wondered: Would it work?

“It sounded like AIM was a coin flip whether they were going to do it or not,” joked Parsons, a finance major who graduated in 1995. “And that coin flip was kind of a big deal for me.”

It was a big deal because AIM did launch, and Parsons was selected for the first class, AIM 1. And diving into the world of investments as a student set him on a career path to become a global portfolio manager. Parsons is now CEO of Junto Capital Management, a hedge fund he started in 2014 that manages $700 million.

Still grateful for his AIM foundation, Parsons joined 300 other AIM alums on June 12 and 13 to celebrate the 20th anniversary of a class that has become storied.

Network on top of a network

Unsurprisingly, the reunion agenda was packed with presentations relevant to top money managers, including:

● “The Future of American Energy”
● “Credit Market Opportunities: What’s Next”
● “AIM for Alpha: The Best Buy I Can Find” 
● “The Notre Dame Endowment: Investing in the Current Environment”

There was a Friday night keynote by Under Armour CEO Kevin Plank, and a Saturday morning leadership session by retired Navy SEAL team leader Robert O’Neill.

But the real reason for the fantastic turnout — 300 out of 995 AIM alums — was the chance to see each other again. AIM students are particularly close, not only because teamwork is a key component of the course, but also because the challenge of working among exceptional peers brings them together.

“It’s definitely a shared experience,” said Kimberly Flynn, a 1999 finance graduate who was part of AIM 7 and who works as head of product development and senior vice president of Nuveen Investments in Chicago. “It’s an intense, sometimes painful, experience. It’s really exciting because you’re with very smart people who want to be in the same field. And it’s a transition period; it helps you move into the next phase of your life. So you really do become very close.”

Not only do AIM students bond with students in their own classes, they get to know alums through corporate field trips, campus presentations and legendary reunions. And they retain strong ties to past and present AIM professors: Reilly, former dean of the business college and finance professor emeritus; Affleck-Graves, former finance chair and current Notre Dame executive vice president; Malpass, University vice president and chief investment officer; Edward Trubac, finance professor emeritus; Bill McDonald, the Thomas A. and James J. Bruder Professor of Administrative Leadership; and Jerry Langley, finance professional specialist. All but Reilly and Trubac still instruct the course.

Malpass calls AIM a network on top of a network. “They’re part of the renowned Notre Dame network, and then they have this incredible AIM experience on top of that,” he said. “They are extremely loyal to AIM and identify strongly with their AIM class year. Many of them still hold stock in the corporation they researched and worked on in class. It really is amazing.”

Expanding a virtuous circle

Over two decades, AIM has built a national reputation and is highly regarded by Wall Street recruiters. “It’s one of the great stories in higher education over the last 20 or 30 years,” Malpass said, pointing out that AIM classes currently manage $10.5 million of the University’s $10 billion endowment.

Additionally, the fund has returned 11.7 percent annualized versus 8.6 percent for its primary benchmark, the Standard & Poor’s 500 Index.

But the class is much more than good investing. “It’s a virtuous circle with AIM alums helping AIM students into the business world,” Malpass said. “It’s wonderful to see these young people mature and do well.”

Which circles us back to Parsons.

Inspired by AIM, he and his wife, pediatrician Carrie Quinn, a 1996 Notre Dame alumna, provided a gift to establish the Notre Dame Institute for Global Investing. With a goal of advancing investment-management research and education, the Institute will leverage Mendoza’s top-rated finance faculty, innovative curriculum and extensive strategic partnerships to form a platform for learning and influencing the way investment managers think about global finance.

During a panel discussion about the Institute, Parsons said it will emphasize ethics in every area of investing: transparency, corporate culture, relationships with clients. “This will give us opportunities to change the way firms operate in this regard,” he said.

And while AIM already is seen as one of the premier investment courses in the nation, the Institute will elevate it further and provide greater opportunities for students, Malpass said: “The next 20 years will be even better.”

An impressive return from a coin flip.