Student Research Featured at Dallas Fed for Third Year


This spring, the work of two students enrolled in the Financial Analyst Honors Program, Kelechi Nwokocha ’13 and  Michael Biagi ’13, was featured in the 7th annual Economics Scholars Program for Undergraduate Research hosted by the Federal Reserve Bank of Dallas.

The one-day undergraduate economics research conference was attended by 175 undergraduate students and faculty from 14 states.   Thirty-three students presented papers.  In the past three years that the University at Albany has participated in this conference, ten of the eleven papers submitted were accepted, far surpassing the general acceptance rate of 58%.

The keynote speaker was Dr. Harvey Rosenblum, Executive Vice President and Director of Research for the Dallas Federal Reserve Bank, who spoke about conflicting indicators of whether the United States is recovering from the 2008 crisis.

The UAlbany students presented their work in the session on Financial Markets and Training. Nwokocha researched “Stock Repurchases and Degree of Conviction: A Test of Signaling Theory.” He sought to determine whether publicly traded companies make enlightened decisions when repurchasing their own stock. Based on subsequent market performance, he found that small-cap firms make better choices than large-cap firms as to the timing and magnitudes of their stock repurchases. He concluded that small-cap firms’ announcements are more credible signals.

Biagi’s paper is titled, "Is Hedge Fund Mortality Explained by Cross-Sectional Return Volatility."
Working on the assumption that hedge funds are prone to failure, Biagi found that hedge-funds tend to fail in larger numbers during and after periods of high dispersion of returns among stocks. His conclusion: higher cross-sectional volatility creates a condition under which more talented managers can reveal their superiority, and also exposes the inferior talents of less-gifted managers.

Nwokocha and Biagi traveled to Dallas with Associate Professor David Smith who teaches the Financial Analysis Honors Seminar in which the papers were written. Biagi said, “Professor Smith has been alongside teaching, guiding, and helping me since I joined the Financial Analyst Honors Program. His dedication to the program and his students are reflected in the papers we write and it was an honor to represent his class, the FA program, and the University at Albany in Dallas.”

According to Dr. Smith, the high quality of student work is facilitated by the wide array of analytical techniques and top-quality databases funded by the Center for Institutional Investment Management, the School of Business Dean's Office, and university libraries.

Nwokocha said, “My experience was extremely enlightening considering the amount of other undergraduate researchers from various universities across the country. Papers were highly diverse and focused on other aspects of economics including sports, agriculture, and economic events, just to name a few. Fortunately for us, Professor Smith kept Mike and I properly coached and motivated to present to a room of highly intellectual individuals. I was proud to not only represent my work but to represent the University at Albany.”

All of the students in the Financial Analyst Honors Program are required to complete a thesis and present their work to fellow students, faculty, and alumni. This year, the presentations were streamed over the web, allowing 15 to 20 additional alumni to participate. Smith noted that many FAH students produce work of high enough quality to be accepted at this conference, but for various reasons they elect not to submit their papers. Nwokocha said, “I highly encourage other students to pursue this endeavor. It is an enriching experience from all aspects and a true challenge worth taking."

In addition to national kudos, the two students tied for first place for the 4th annual University at Albany Center for Institutional Investment Management award for best senior thesis, as selected by the CIIM Advisory Board, composed of executives from institutional investment firms on Wall Street and in the Capital District.