After failing to produce a paper for last year's Schroders essay competition organised by the Department of Statistics and Actuarial Science at Stellenbosch University (SU), Masters student in Economics Ruan Erasmus made amends by delivering the best paper of the 2017 competition.
The essay competition forms part of a joint investment research initiative that stems from an agreement signed between the Department of Statistics and Actuarial Sciences and global asset management firm Schroders' Multi-asset Investments and Portfolio Solutions (MAPS) division in November 2015.
The competition was open to postgraduate students from the Departments of Statistics and Actuarial Science, Business Management and Economics.
The winners – Ruan, Theunis Bothma, Kiran Singh, Jan Esterhuysen, Gideon du Rand, Marcel Bovijn, George Spies, Christina Yaffes, Lara Marais and Ian Louw – walked away with R20000 each.
The top three achievers all wrote their essay on the same topic: Finance & Investment – Gauging investor sentiment.
Ruan's topic was 'Stock Index Performance: The Role of Media Sentiment'.
“The topic was very similar to that of my honours dissertation, which focuses on the effect of media sentiment in financial markets. By participating in the competition, I was not only forced to delve deeper into the topic of media sentiment but it also enabled me to acquire more knowledge of the intricate relationships that exist within the financial sphere.
“The key point that I've learnt from this competition is that one should always seize an opportunity where there is a chance to broaden one's horizon and conduct research in one's preferred field of study. I am, therefore, grateful that Schroders has brought such an invaluable experience to Stellenbosch University for the second consecutive year."
Ashley Lester, Global Head of Multi Asset and Portfolio Solutions Research at Schroders, reviewed all the essays.
“The essay competition this year produced a pleasing number of entries, including some excellent and thoughtful pieces of innovative research. Some of the essays undertook original empirical research, with fascinating results.
“Mr Erasmus brought together a range of new and innovative data sets to investigate the effect of media and investor sentiment on stock returns – an excellent question that brings him to the forefront of the new types of study enabled by 'big data'. Mr Bothma also undertook an interesting empirical study of a variety of alternative risk measures relating to equity portfolios. Perhaps the most ambitious theoretical exercise was undertaken by Mr Singh, who presented an extensive and unashamedly opinionated survey of a vast literature on risk measures, with ambitious recommendations for future research. Congratulations to all the winners of our competition."
Carel van der Merwe of the Department of Statistics and Actuarial Science, who managed and organised the competition with Schroders, was pleased with the growing interest in the essay competition as well as the positive feedback from Schroders.