Editorial Board Spotlight: How a $50,000 student-managed fund shaped POBA ex-CIO's career
In 1992, Jang Dong-hun set out for the US from his native South Korea with the aspiration to learn the art and science of investment management.
After starting his career at a local asset management company earlier, he saw a need to further develop his skillsets - prompting him to enrol in business school.
“After four years doing assistant-level asset management activities, I had mostly listened and learned what senior colleagues taught me. I found myself in need to further educate myself and increase my asset management skills to match extensive knowledge the industry requires,” Jang recalled to AsianInvestor.
He certainly improved his skills. Jang eventually went on to become the chief investment officer at Korea’s Public Officials Benefit Association (POBA), one of the country's largest pension funds.
Today, he is an advisor at Korean legal firm Yulchon, having stepped down from his CIO role in February 2022.
He is also part of AsianInvestor's Editorial Advisory Board.
The veteran investor recalled that during his MBA at University of Iowa’s (UoI) Henry B. Tippie College of Business, he was among the inaugural batch of students to manage The Henry Fund, named for its two founding benefactors, Henry Royer and Henry B. Tippie.
The fund offers select students to apply their academic learnings on a real US equity-focused portfolio.
The fund was established with an initial seed capital of $50,000 in the spring of 1994, and for two semesters Jang was put in charge of pitching stocks in the financial services sector.
“At that time, $50,000 was not a big amount. But the annual tuition was slightly less than $10,000 for non-residents at the time, so it was still a considerable sum,” Jang said.
Today, The Henry Fund manages an equity portfolio valued at more than $23 million. Since 1994, the student-led investment fund has averaged 12.32% in returns, beating the S&P 500.
LIFE EXPERIENCE
For Jang, his experience with the The Henry Fund was instrumental in developing his investment skills.
Each student covered a sector and had to individually and independently research and propose one or several stocks to the fund’s investment committee, which comprised CFA-certified UoI alumnus working in the asset management industry.
“Think about how it was a live experience for an MBA student to present your ideas to industry veterans with years of experience. They asked lots of questions, so it was a really rewarding learning experience,” Jang recollects.
Jang's first pitch was that the fund should buy stocks in Travellers Group, at the time a diverse group of financial concerns that later merged with Citicorp in 1998.
“I still have that Travellers Group pitch document at home,” he said.
MEANINGFUL MONEY
When he returned to Korea with an MBA degree in hand, Jang applied what he learned in the Korean stock market.
Eventually, his career trajectory led him to POBA.
In managing retirement funds, he found a purpose within in his profession that matched The Henry Fund, where the proceeds regularly fund student scholarships and programs that benefit students.
“All investors chase money, but money is only meaningful when it is used and allocated wisely. In that extension, I wish to contribute to the growing pension funds of Koreans,” Jang said.
Even while working at Yulchon as advisor at Korean law firm, he regularly talks with former peers at Korean asset owners. He is also an enthusiastic columnist, writing on financial topics ranging from real estate to inflation.
“I personally offer my support and contribution to strong asset management retirement funds for a rapidly aging Korean population. I think that is my final mission -- to contribute to this task,” Jang said.
As for The Henry Fund, while he is no longer involved, he has fond memories about his time managing the fund and admits he still keeps an eye on its performance.
“I keep track on how The Henry Fund is performing, and I support it from the sidelines,” he added.