Fiscal Year 2009-2010 - CFA Society of Dallas

CFA Society of
Dallas-Fort Worth
ANNUAL REPORT
2009-2010
ABOUT CFA/DFW
The CFA Society of Dallas-Fort Worth (formerly the Dallas Society of
Financial Analysts and prior to that, the Dallas Association of Investment
Analysts) was founded in 1951 to:
 provide interchange between investment and portfolio managers;
 promote good fellowship among those whose primary occupation is
investment and securities analysis;
 improve analytical procedures and techniques;
 promote our membership to the investing public. The society plays a
vital role within the Dallas and Fort Worth area promoting a better
understanding of the investment management profession; (Media
Guide)
 encourage, strengthen and support the Chartered Financial Analyst®
professional designation and to assist those candidates working
towards achieving the CFA® charter.
Of equal importance has been its mission to promote high standards of
professional and ethical conduct among its members. For more than 50
years, these objectives have guided the society and the local investment
community. The society was the 15th formed worldwide.
As of May 2010, The CFA Society of Dallas-Fort Worth has 1047 active
members, and is among the largest member societies of the CFA Institute
(formerly the Association of Investment Management and Research).
CFA Society of
Dallas/Fort Worth
Tel: 214-363-3284
Email: [email protected]
www.cfadfw.org
Mailing Address:
Post Office Box 820516
Dallas, TX 75382
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CONTENTS
President’s Letter ............................................................... 4
Mission & Purpose .............................................................. 5
Board of Directors .............................................................. 6
Past Presidents .................................................................. 7
Strategic Advisory Board .................................................... 8
Awards & Scholarships ........................................................ 8
Investment Research Challenge ............................................ 9
CFA Exam Review ..............................................................10
Programs .........................................................................11
Forecast Dinner .................................................................13
University Relations ...........................................................14
Career Development ..........................................................14
Benefits of Membership ......................................................15
Membership Requirements ..................................................16
Financial Statements ..........................................................19
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PRESIDENT’S LETTER
To our members of the CFA Society of Dallas/Fort Worth:
Enclosed you will find the CFA Society of Dallas Fort Worth annual report.
The latest year has been a year of challenge and rebuilding for our industry.
It has been my pleasure, as your local president to represent the
membership, board members, and sponsors over the latest year, as they
have all collectively worked hard, and made great strides for our local
membership and our industry as a whole.
In the following pages, short summaries from each area of our organization
from the respective local board member have been included for your
review. If you find a certain area of special interest, please reach out to
that member for further information and feel free to inquire about a board
membership and serving your fellow members as well. Each area is
extremely important in serving member needs and as such, we welcome
feedback from this report and look forward to serving members for the next
12 months.
Sincerely,
John A Kvale
President
CFA Society of Dallas/Ft. Worth
2009-2010
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MISSION & PURPOSE
CFA/DFW Mission Statement
The goal of the CFA Society of Dallas-Fort Worth is to provide timely
information, education, professional enhancement, networking
opportunities and advocacy to investment professionals in the greater
North Texas area.
CFA/DFW Purpose
The purposes of the society are as follows:





To provide a professional society for financial analysts and
investment professionals in the Dallas-Fort Worth and North
Texas area.
To foster the interchange of information and opinions among the
members.
To promote topical and educational meetings relevant to the
profession.
To foster a high standard of ethics and to promote sound,
professional standards of investment research and portfolio
management among the members.
To foster high educational standards for institutions providing
instruction in the field of financial analysis and also among the
members through participation in the Chartered Financial
Analyst® Examination Program.
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2009-2010 BOARD OF DIRECTORS
Mr. David Aler
VP - University Relations/ Scholarship
Verde Apartment Communities
1801 Royal Lane Suite 400
Dallas, TX 75229
469-420-6018
[email protected]
Mr. Robert Butler
Programs Co-Chair
(214) 628-3499
[email protected]
Mr. Mahesh Gehani
Volunteer/Social Director
Ms. Florence Huang
Membership
Luminant Energy
1601 Bryan St.
Dallas, TX 75201
214-875-9084
[email protected]
Joe Chairez
University Relations Co-Chair
JP Morgan
(214) 965-3528
[email protected]
Mr. John Kvale
President
JK Capital Management
8222 Douglas Ave. Suite 590
Dallas, TX 75225
214 706-4304
[email protected]
Ms. Julia Cunningham
Past President
Deloitte & Touche
2200 Ross Ave. Suite 1600
Dallas, TX 75201
214-840-1506
[email protected]
Mr. David V. Lewis
Past President
FCM Investments
2200 Ross Ave. Suite 4600 W
Dallas, TX 75201
214-665-6920
[email protected]
Ms. Jacqueline L. Finley
VP-Communications
Forecast Dinner Co-Chair/Volunteers
Westwood Holdings Group,Inc
200 Crescent Ct. Suite 1200
Dallas, TX 75201
214-756-6956
[email protected]
Lisa McDaniel
Forecast Dinner Chair
Volunteer Chair
ALMFirst Financial Advisors, LLC
6688 N Central Expy. Suite 200
Dallas, TX 75206
214-987-0860 x117
[email protected]
Mr. Ben Friedman
Public Relations Chair
Cimmaron Asset Management
545 E. John Carpenter Freeway
Suite 1900
Irving, TX 75062
214) 389-9185
[email protected]
Mr. Paul Olschwanger
Career Development
Olschwanger Partners, LLC
7522 Campbell Rd. Ste. 113 196
Dallas, TX 75248
972-931-9144
[email protected]
Ms. Cassaundra Frost
Treasurer
Bank of Texas
7600 W. NW Highway
Dallas, TX 75225
214-706-0355
[email protected]
Ms. Michelle Pryor
Secretary
Larry Thompson and Associates
3500 Oak Lawn Avenue
Dallas, TX 75219-4329
214- 752-5430
[email protected]
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Nick Stone
Newsletter
CSG Investments, Inc.
6000 Legacy Drive
Plano, TX 75024
972-206-6367
[email protected]
Bryan Sweeney
Programs Co-Chair
Sweeney Financial, LLC.
4241 Buena Vista St. Suite 23
Dallas, TX 75205
214-520-3699
[email protected]
Linda Tse
University Relations Co-Chair
Capital Analytics
3308 Duval Drive
Plano, TX 75025
214-459-9846
214-717-9137
[email protected]
Mr. Gary Walsh
Past President #3
Luther King Capital Management
301 Commerce St. Suite 1600
Fort Worth, TX 76102
817-332-3235
[email protected]
Mr. David W. Wiley
Education Review Class
Wiley Investments
6300 Ridglea Pl. Suite 215
Fort Worth, TX 76116
817-862-1231
[email protected]
Dan Meader
CFA Board of Governors
Trinity Advisory Group
420 N. Carroll Ave. Suite 140
Southlake, TX 76092
817-310-2901
[email protected]
Ms. Sharon L. Criswell
SW Region PCR
ALMFirst Financial Advisors, LLC
6688 N Central Expy. Suite 200
Dallas, TX 75206
214-987-0860
[email protected]
PAST PRESIDENTS
David Lewis, CFA
Julia Cunningham, CFA
Gary G. Walsh, CFA
Sharon Criswell, CFA
Lyndon J.E. Westerberg, CFA
Matt L. Peden. CFA
Royce Medlin, CFA
Scott L. Miller, CFA
David B. Ackerman, CFA
David W. Wiley, CFA
Daniel S. Meader, CFA
Jeffrey L. Williams, CFA
Luellen Triltsch, CFA
Lynda J. Calkin, CFA
Gregg A. Jahnke, CFA
Jean Krone Bono, CFA
Stephan J. Klaffke, CFA
Leon F. Andrus, CFA
Hilton Hemphill, CFA
Perry V. Rushing, CFA
John D. Schoch, CFA
John C. Fritsche, CFA
Jessica S. Gallia, CFA
Thomas S. Wright, CFA
Wayne G. Willems, CFA
Ben A. Hock, Jr., CFA
William J. Goodwin, CFA
Richard D. Frizell, CFA
Henry Hermann, CFA
Richard A. Berry, CFA
Kenneth R. Spreen, CFA
Jeffrey K. Wentworth, CFA
Vernon Dale Crues, CFA
Daniel J. Forrestal III, CFA
Willam Paul Weathers, CFA
David M. Reichert, CFA
Robert M. Nicoud
Russell Cleveland, CFA
Thomas M. Tatum, Jr., CFA
Curtis L. Scott, CFA
Harold W. Hartley, CFA
Herbert M. Jones, CFA
Gerald L. Ray, CFA
George T. Hemmingson, Jr. CFA
Paul H. Kirk, CFA
Lynn L. McCormick, CFA
James. R. Crews, CFA
James C. McCormick, CFA
Harold M. Achziger, CFA
R. Bruce Thomas, Jr., CFA
M. Harvey Earp, CFA
John M. McGinnis
Ralph E. Scott
T. Davis Temple
George S. Rooker
James S. Cleaver
Clifford J. Osborn
Harland Mayes
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STRATEGIC ADVISORY BOARD
Members
Brian Bruce, CFA, Director of the ENCAP Investments & LCM Group Alternative Asset
Management Center, Cox School of Business, SMU
Roddy Cummins, CFA, Executive Director, Investment Services, Guidestone Financial Resources
Fahrenbruch Jeff, Barrow, Hanley, Mewhinney & Strauss
Jim Hille, CFA Chief Investment Officer, Texas Christian University Endowment
Don Hultgren CFA, CEO, Southwest Securities
Luther King, CFA, President, Luther King Investments
Larry Lockwood, CFA, C.R. Williams Professor of Financial Studies, Texas Christian University
Brian McManus, CFA, VP - Research, Westwood Holdings Group,Inc
Emmett M. Murphy, CFA, Paradigm Capital Corporation
John Muse, CFA, Chairman, HM Capital
John Peavy, CFA
Bill Quinn, CFA, American Beacon
Steve Smith, CFA, Smith Asset Management
Jeff Williams, CFA, JP Morgan
AWARDS & SCHOLARSHIPS
Distinguished Member Award - CFA Society of
Dallas/Fort Worth
This award was established in 2005 to recognize members who have
volunteered to serve the Society on a long standing basis and as a result,
our Society is stronger today.






Sharon Criswell
Scott Miller
Lyndon Westerberg
Matt Peden
Dan Meader
Dave Wiley
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2010
2009
2008
2007
2006
2005
INVESTMENT RESEARCH CHALLENGE
In 2007, the CFA Society of Dallas/Fort Worth and the CFA Society of Houston
teamed up to launch an exciting new initiative, Investment Research Challenge –
Texas. In the initial year of the Challenge, student teams from Rice, A&M, TCU
and SMU competed with each other on analyzing, writing, and presenting a report
recommending a “Buy”, “Sell”, or “Hold” position on a publicly traded company.
The societies assisted in providing education tools; the goal being to provide a
value-added real-world application for these students. The teams were then
assigned the company to analyze with access to the CEO. Teams were given a
template to follow in completing their written analysis/report. All four Texas
societies, Austin, Dallas-Fort Worth, Houston and San Antonio provided mentors
for the teams, judges or graders. Finalist teams competed before an oral panel
made up of leaders in our investment community at the Texas Investment
Portfolio Symposium (TIPS). The winning team went on to compete regionally
against other winners hosted by CFA Institute in New York City.
Each year the local challenge has grown, and last year it was expanded beyond
Texas. This year a total of 10 teams are competing; Rice, LSU, SMU, TCU, Texas
A&M, Texas Tech, Tulane, U of H, UT, UTD and UTSA. The Texas company for
2010 was Rent-A-Center (RCII).
5 finalists; LSU, SMU, U of H, UTD, and UTSA
competed at SMU on February 20th with University of Houston winning the IRCTexas competition and SMU coming in second. This is U of H’s 2nd time to win the
IRC-Texas. Their team went on to compete against other challenge winners (28
local challenges across Canada, Latin America and the U.S.) in CFA Institute’s
Americas Regional IRC held March 18th in New York City. The winner was
Brigham Young University who went on to complete in the global finals held on
April 17, 2010 in Hong Kong where the University of the Philippines-Diliman won
the Global Investment Research Challenge for 2010.
Thanks go out to Mark E. Speese, CEO, Robert D. Davis, CFO of Rent-ACenter and all the contributors of IRC Texas in our CFA DFW society; Brian
Bruce, Robert Butler, Joe Chairez, David Cordell, Ben Cowan, Roddy
Cummins, Don Hultgren, Ian Lim, Dr. Larry Lockwood, Brian McManus,
Jeff Mercer, Steve Orr, and Matt Quinn. Special thanks to the Society
Presidents of CFA-Austin, CFA-DFW, CFA-Houston, CFA-Louisiana, CFASan Antonio, and most importantly, Leah Bennett of CFA-Houston for
coordinating the Investment Research Challenge – Texas and making it
the huge success it is today. To get involved, contact Sharon Criswell
([email protected]).
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CFA EXAM REVIEW
CFA-DFW's Weekly CFA Review Course and Study Program continues to grow and
prosper, benefitting area Candidates and your Society. We continue to offer weekly
classes in the Spring for all three Levels, and in the Fall for Level 1. We are currently
offering programs at three universities: University of Texas at Dallas, University of
Dallas, and Texas Christian University.
This is the 20th year since CFA-DFW took over administration of the program.
# of Candidates Enrolled
Net Profit to CFA/DFW
1991
69
$2,377
1992
89
929
1993
105
1,467
1994
140
5,521
1995
147
2,500
1996
186
5,178
1997
218
10,876
1998
171
12,259
1999
214
26,635
2000
210
33,463
2001
245
28,644
2002
254
21,882
2003
250
9,521
2004
290
20,422
2005
276
17,813
2006
303
23,271
2007
301
28,872
2008
319
34,303
2009
319
34,887
2010
227
14,053
(For 2010, we still have a Fall
2010 Course planned – numbers are for current Spring
2010 program only. Last
Fall’s program had 96 Candidates, and
profitability was $13,754)
To assist the largest group of
Candidates possible, we continue
to
offer
significant amounts of student discounts and full scholarships. Thank you to all the
Instructors from our Society:
John Harris
Travis Keath
Jim Kelley
Larry Lockwood
Scott Miller
Jim Richards
Salil Sarkar
CFA-DFW's education program has raised awareness of the CFA designation. Other Societies have sought our assistance in designing similar programs. I wish to thank the Board
and CFA-DFW membership for its support and for giving me the opportunity to direct the
CFA-DFW Weekly CFA Review Course and Study Program for the past 20 years.
David W. Wiley, CFA
Education Chair, Director, CFA-DFW Society Weekly CFA Review Course & Study Program
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PROGRAMS
Dear Members of the Board and Fellow Members,
The
Program Committee of the CFA Society of DFW is focused on providing a
wide variety of educational programs to our members while also offering
programs on career development and social programs to promote networking
among members. Recognizing the diverse nature of our membership
professionally and geographically, an effort was made to touch as many members
as possible. While the majority of our programs were held in Dallas, we were
also able to offer a number of programs in Fort Worth thanks to our speakers
being generous with their time.

Secrets of Successful Channel Checking – An educational session lead by JP
Mark with Farmhouse Research kicked off our program schedule with an
overview of how to properly conduct channel checking for fundamental
research.

Healthcare Reform & Investing programs – Damien Conover with Morningstar
presented an update on the investment landscape for healthcare along with
thoughts on the pending reform and was kind enough to present in both Fort
Worth and Dallas. Also, thanks to the University of Maryland Alumni we were
fortunate to have a second healthcare reform program in May by Frank Balco,
a 40 year industry veteran.

Alternative Investments - Always a very popular topic with our members we
were able to have multiple events this year covering the diverse aspect of the
asset class

In January, Robert Rough with Pillar Capital Management offered an overview
of Venture Capital investing in general and then focused on the state of the VC
industry here in Texas.

In March, iShares presented interesting research dissecting hedge fund returns
into beta, exotic beta and true alpha and offered a way to invest in the space
using liquid instruments.
In April, Cogent Partners updated us on the private equity secondaries market,
definitely a new topic for many in attendance but an area that could heat up in
the near future.
On May 11, we held two events at UTD that attracted new CFA candidates and
many of our members. The afternoon began with an overview of the CFA
Program from Kathy Pilgrim with the CFA Institute who also was our speaker for
our new Charterholder ceremony and holiday event in December. After a brief
break a very lively panel discussion on ethics and regulation hosted by Nick Stone
and featuring Linda Yoder from the SEC’s Fort Worth office and ethics expert,
Gary Morris thoroughly engaged and entertained all in attendance.
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PROGRAMS
Other Program Highlights:
Social (Thank you to our Social Chair & Committee for the help)

Two happy hour events were held at Blue Mesa in Addison to allow our
members to network over a few cocktails and appetizers.

Fort Worth Happy Hour – Held at the very popular downtown restaurant the Reata.

Holiday Party & New Charterholder Ceremony-Uptown hotspot Lotus
was a great venue for this dual-purpose event with Kathy Pilgrim from
the CFA Institute awarding the new Charters.

Annual Meeting & Year-end Social – With the pressure on to continue
to find cool venues for this event, the trendy club Deux was a big hit
with our members.

CFA DFW Night at the Stars - With great seats, good food, drinks and
fellow members, everyone in attendance had a great night and this
could turn into an annual event.
Webinars (Thank you CFA Institute & other CFA Societies)
A conversation with Meir Statman
and Hersh Shefrin
Economic Growth and Equity Investing
The Next Wave of Hedge Fund Investing
Financial Instrument Accounting: IFRS
after the Crisis
Importance of Asset Allocation
William Poole: Moral Hazard
The State of Financial Market Integrity
Real Estate Investment: PubliclyTraded REITs
Our society also partnered with a few organizations to be able to
offer our members access for additional quality programs.
Hodges Capital 11th Annual Investment
Forum
Southwest Ideas Investor Conference –
Three Part Advisors
The Great Investors’ Best Ideas (GIBI)
symposium
Restructuring and Distressed Valuation
Modeling Training Program - Wall
Street Prep
Turnarounds, Restructurings, and Distressed Investing - University of
Texas at Dallas
TCU's 8th Annual Investment Strategies Conference
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FORECAST DINNER
Forecast Dinner Committee
The Forecast Dinner Committee is responsible for planning the Society’s
largest event each year. The Forecast Dinner Chairs work in conjunction
with the President and other board members to secure speakers for the
event. The committee chairs also oversee all logistical aspects of planning,
including choice of venue and marketing and promotion. Attendance for
the Forecast Dinner continues to be strong, including years that have been
overshadowed by a challenging market environment.
Year
Attendance
Year
Attendance
2005
200
2008
350
2006
279
2009
300
2007
411
2010
329
The 2009 Market Forecast Dinner took place on Wednesday, February 10,
2010, at the Belo Mansion. The panel included:
John Ryding
Chief Economist and a founding partner of RDQ Economics
Mark McCray
Senior Portfolio Manager, PIMCO
Mark Freeman, CFA
Senior Vice President, Portfolio Manager, Westwood Holdings Group, Inc.
Moderator:
John Rogers, CFA
President and CEO, CFA Institute
Committee Chairs: Lisa McDaniel, CFA; Jackie Finley, CFA
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UNIVERSITY RELATIONS
The University Relations Committee is structured to provide representation
to local universities with at least one committee member dedicated to each
represented university. It relies on an open flow of new ideas among
committee members, faculty and students for its success. The DFW Society
University Relations model has proven so successful that other societies
around the world are adopting it. The committee plans to expand on its
success in 2010/2011.
Highlights of University Relations Committee accomplishments in
2009/2010:
· Awarded 14 CFA Exam scholarships and 10 review course
scholarships
· Organized multiple on campus events
· Judged the UTD and SMU Shadow Investment Research Challenges
· Introduced several new professors and society members to the
committee
Thank you to the Committee Members:
David Aler
Claire Baranzelli
David Cordell
Sharon Criswell
Julia Cunningham
Ben Friedman
Corey Horsch
Jeff Jones
Larry Lockwood
Chris Lucas
Jonathan Oge
Nick Stone
Niranjan Tripathy
Jake Trousdale
Linda Tse
Gary Walsh
Dave Wiley
CAREER DEVELOPMENT
As Director of Career Services for the CFA Society of Dallas-Ft. Worth, I
have fielded over 100 calls from investment professionals moving to the
area and/or looking for employment along with counseling many others
locally on their current position and career development. In addition, I
presented to the society on the topic, Manage Your Career Like You
Manage Client Portfolios and met one-on-one with 6 members to help
guide and motivate them through some challenging times. I also served as
a panel speaker representing the society at UTD. Throughout the past
year, I gave more than 20 speeches to various CFA societies around the
country and brought back new ideas for future programs.
Committee Chair: Paul Olschwanger
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BENEFITS OF MEMBERSHIP
Regularly Scheduled Meetings
The CFA Society of Dallas-Fort Worth meets regularly from September
through May to hear corporate presentations, educational presentations or
industry focused panel discussions. The meetings are open to all members
and their guests. Reservations are required and can be made online or by e
-mail.
Corporate Programs
Corporate Programs feature formal presentations by senior executives of
publicly traded companies. After describing their company's current
operations and outlook, these decision-makers then respond to audience
questions, affording unique insights into company and industry issues.
Educational Programs
Educational Programs are a major goal of the society and constitute
approximately one half of all meetings. Distinguished speakers explore
topics of current interest to practitioners, and CFA Charterholders earn
credit in the CFA Institute Continuing Education Program.
Annual New Charterholder Recognition
Every fall, the Society honors its new CFA Charterholders with a reception
in their honor.
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MEMBERSHIP REQUIREMENTS
Each person hereafter admitted as a regular member shall:
 hold a bachelor's degree from an accredited academic institution or have
equivalent education or work experience
 have either:
 four years experience in financial analysis as defined in the CFA/
DFW by-laws, and have passed Chartered Financial Analyst
Examination I ("CFA I"), or;
 six years of acceptable professional work experience in financial
analysis and passed a self-administered ethics examination in a
format established and approved by the Board of Governors of the
CFA Institute, or;
 at the time of admission as a regular member, satisfy at least one
of the following requirements:
 a person occupying the position of professor (including assistant or
associate professor) or dean of a college or university who is
currently teaching or conducting research in the field of financial
analysis and/or investments, or,
 is a Chartered Financial Analyst Charterholder, or,
 is a regular member of the CFA Institute and a regular member of
another CFA Institute society, or,
 is currently engaged as an economist in the field of financial
analysis process, or,
 is currently engaged principally in the occupation of financial
analysis as related to securities investment management of
corporate pension, profit sharing or similar funds, or,
 is currently engaged principally in the occupation of financial
analysis as related to securities investment management for a
public agency, or,
 is currently engaged principally in the occupation of financial
analysis and has administrative, or executive duties related to
securities investment as an employee, officer or partner of a bank,
insurance company, securities firm, financial publishing house or
other similar organization.
Additional Requirement for Membership
No person shall become a regular or affiliate member of the Corporation, or
CFA Institute who has not signed a Member's Agreement, and Member's
Conduct Statement as provided in the CFA Institute By-Laws Article 9, Section
2 and Article 10, Section 2, which attest, among other things, that the member
has carefully read the CFA Institute Code of Ethics and Standards and has
disclosed fully any prior violation and pending regulatory or other proceedings
relating to his or her conduct.
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FINANCIAL REPORT
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FINANCIAL REPORT
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FINANCIAL REPORT
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FINANCIAL REPORT
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