Smart Woman Securities: Educating Young Female Investors

By Stephanie Wilcox (Middlefield, CT)

In 2005 Tracy Britt and Teresa Hsiao were juniors studying economics at Harvard when they discovered that while women want to manage money and make money, there were few ways in which they could learn how to do the managing part. Though there were lots of investment clubs on campus, most of them included people who already knew about investing, and therefore many women were too intimidated to join.

So Britt, now 26, and Hsiao, 25, went to work creating Smart Woman Securities (SWS) to teach women about finances from the ground level.

During their 2005 summer internship at Lehman Brothers where they worked in equity research, the two ambitious young entrepreneurs were able to get a lot of good advice on how to structure the program.

“We worked through the summer to develop what we believed would be the best program and implemented it the next year in 2006,” said Hsiao. Despite the plethora of investing websites, Hsiao points out that, “There really isn’t anything else at colleges like this that is women-to-women. And a lot of these sites are more high level than what we try to provide, which is the basics.” SWS is an educational tool for women to learn about investing and to feel safe in a joint community where everyone is learning at the same time.

Building a Growing Program

Laura Travers, a student at Boston College who led the founding team of Boston College’s SWS chapter, explained that the curriculum that SWS follows is relevant to students on a much more personal level than anything they are taught in their undergraduate business classes. It’s also uniquely accessible to non-business majors.

“Upon graduating, I think the most important concepts a woman should have a concrete understanding of are those related to her finances,” Travers said. “SWS provides a forum not only for undergraduate women to be taught these concepts, but also for them to ask questions, discuss with their peers and practice applying what they learn before they leave school.”

The main educational piece of the SWS program is a 10-week seminar series that is the “bread and butter” of investing. Students complete an investment project and work in teams looking at the stocks they’ll be following. Part two is the mentoring piece; an ongoing component with individual mentoring at the chapter level and also at the national level where interested students are paired with investors at J.P. Morgan. The third and final component is the investing piece.

“Learning about investing and terminology is great, but we feel learning by doing is the way in which women are going to learn about investing as a whole,” said Hsiao. “We started an investment fund at Harvard that has been doing very well in getting women to invest actual money. The students split into research teams similar to how investment banks structure their equity research arm. We’re encouraging other chapters to start one as well.”

Aside from their full time jobs, Britt and Hsiao manage SWS by keeping up with the individual chapters and recruiting. From December to April there is a three-step application process where new chapters will emerge at the end. Students bring applications forward and are asked what they would do for a soft launch of SWS on their campus and how their team works together.

“We want to make sure they would be dedicated and motivated and that SWS would be a good fit for them,” Hsiao said. “We provide lots of resources, and they’re delivering the message.” Last year there were about 10 applications; five schools went through the soft launch and four became new chapters – Boston College, Dartmouth, Cornell and Princeton. They joined the four existing chapters, Columbia, Fordham, Harvard and Yale. SWS currently has 353 members across eight chapters.

According to Hsiao, the main goal is to get the program out there and to expand nationally. “We believe strongly in the mission of learning about investment, not for career or personal reasons, but on all levels; and not only to learn but to understand,” she said. “We think investing as a whole is intimidating for many, especially since this is a male-dominated world. SWS is a great opportunity to learn how to speak the investment language, which is half the battle.”

Learning from Investment Icons

And there’s another perk to SWS: Meeting Warren Buffett.

When the program first started in 2006, Britt and one of the founding team members from Omaha, Tiffany Niver, ambitiously reached out to “the Oracle of Omaha,” Warren Buffett, in a letter. Today, SWS has an annual trip to meet with him.

“It’s great to have everyone meet Mr. Buffett,” said Hsiao. “He’s a great champion of the program, and we’re grateful for his support.”

While Travers agrees, she said, “I participated in the annual Warren Buffett Trip last year and can honestly say that for me, spending the weekend networking with women from the other seven SWS chapters was as valuable an opportunity as meeting Mr. Buffett himself! SWS has enabled me to connect with like-minded women at my school and every other school where there is an SWS chapter.”

What started out as a great addition to the Harvard campus is growing more each day – and more than its founders ever dreamed. “We’re definitely excited about it and the overwhelming response from other women on different campuses,” said Hsiao. “The students are wonderful, and they essentially run the program. But what’s really exciting is we teach them how to learn about investing and how to invest in their future, but the women who come to us to start organizations are basically taking a mini entrepreneurship class, and we’re providing guidance. It’s exciting to see women interested in it for their well-being. It’s very rewarding.”