Personally, I have always found that finance schools do not necessarily help future investors think long-term. There are a host of funds and stock market simulations that allow them to familiarize themselves with the world of stock market investing. The problem is that most are short term focused! How else can you do it when a finance course only lasts one school session? How do you ask students to invest for the long term when they are evaluated on the performance of their portfolio over three or six months? Such exercises are certainly interesting from a didactic point of view, but they probably do not develop the “long-term” thinking of students.
This is why COTE 100 approached Laval University to launch an investment project that stands out: an investment fund that would truly be focused on the long term.
I humbly admit that the idea did not come from me – it came from a presentation by the insurance company Markel that I attended in Omaha in May 2023, on the sidelines of the annual meeting of Berkshire Hathaway.
As the managers of Markel did with two American universities, why not set up an investment fund truly focused on the long term? In such a fund, students from Laval University would propose, with supporting analysis, a maximum of 20 North American securities which would be kept, without transactions, for twenty years. The winning team would be identified by a selection committee and would receive a $5,000 scholarship. The remainder ($20,000) would be invested in a maximum of 20 stocks for the next 20 years… with no transactions after the portfolio is constructed.
With such conditions, you have to admit that we encourage more “long-term” thinking!
I also wrote a blog on this subject in May 2023.
COTE 100 has committed to paying $25,000 per year for the next twenty years to Laval University to implement this project. The first portfolio will be invested by the end of the spring 2024 session. Starting in the 2024-2025 school year, the goal is to incorporate the project into an investment course in the baccalaureate in finance.
Each year for the next 20 years, a portfolio of $20,000 will be invested. Starting in the 21st year, the first portfolio of $20,000 (that of 2024) will be rolled into a new portfolio and so on for subsequent years. Can we imagine a project that is longer-term?
How much will each of these portfolios be worth after 20 years? $40,000? $100,000? $200,000? More? It is obviously impossible to know, but it will be interesting to follow the evolution of the value of these portfolios over time.
I believe we have a crying need for young students and investors who will learn to think in the long term. With this project, I am proud of the contribution of COTE 100 to promote the development of “long-term” thinking among finance students at Laval University.
I would like to thank the people at Laval University who have not only been very open to this project, which is off the beaten track, but who have also shown great diligence in setting it up. Good luck to all participants!
Philippe Le Blanc, CFA, MBA
To find out more about this project, visit this page.
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