University Finance Lab
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University Finance Lab is a consultancy based in the United States, that assists colleges and universities with their in-house, trading rooms and finance labs. It is a complete directory of University-based Finance Labs, while offering research on the performance and need for such rooms at business schools across North America.
Since the establishment of University Finance Lab, it has offered consultancy and design rendering, to create the best environment for students to learn at the business schools. The company's role and the general role of trading rooms has received coverage since the millennium. The company predominantly works with North American-based Universities, as this is where the majority of the demand currently is for education based trading rooms.
In 2005, the company featured in an article created by McMaster University, studying the role that finance labs can play as a learning aid for economics students. The article went onto feature in the peer-reviewed, Journal of Financial Education. In the article it was discussed about how many develop the knowledge while studying, but then it takes time for them to learn the skills, when in a real life trading environment. At the time, University Finance Lab's had already been established, and was used as an example to help promote a higher level of competency with students that had graduated.
Later that year, a similar study was carried out by the non-profit education Educause. Their study focused on the use of technology to improve higher education and how trading rooms designed by University Finance Lab and their partners, were assisting learning at a higher and further level of education.
As more trading rooms were installed in Universities and Colleges, their uses began to be discussed in various Journals. This then changed the overall approach to the design and implementation of future Finance Labs, to ensure they could be used for multiple learning techniques.
University Finance Labs started to develop numerous partnerships from 2006 onwards. As the need for technology grew, such as tickers, so did the implementation of such technology within business schools.
Since the introduction of finance labs and trading rooms into an academic environment, University Finance Labs have seem more elaborate and high-tech labs been developed. In 2010, the New York Times ran an article about the introduction and development of many University-based finance labs. Investment from firm such as Goldman Sachs began to filter into the operations, developing more realistic trading rooms and also giving the students more capital to work with. At the time, the largest investments came at Ivy League schools, many of which had their finance labs developed by University Finance Labs.
University trading rooms
The need for University-based trading rooms has been present since the late 1990s. Finance Labs give students a greater understanding of awareness of the financial markets, how they operate in real-time, along with their rules and regulations. Finance rooms are typically used by economics and finance majors or minors, giving them real experiences while still in an academic environment.
The change in United States' teaching and becoming more technology based, is due to the changing environment on Wall Street and other financial markets. Dominant floor stocks, such as the NYSE are facing increased competition from automated trading systems, such as the NASDAQ. This became more apparent in 2005, when the NASDAQ overtook the NYSE in both share and dollar transactions in 2005. Therefore, while traditional floor trading was still essential, students need to have a greater understanding in more recent times on automated trading systems and other technological advances in economics.
The size and scale of trading rooms has been known to vary from a few thousand dollars to much higher figures. In a recent blog publication, it was stated that figures paid for state of the art trading rooms within colleges and universities can be as high as $3 million USD.
- Siam, John J. (2005). "University Trading Centres and Their Role in Business Education". Journal of Financial Education.
- Kvavik, Robert B. (2005). "Convenience, Communications, and Control: How Students Use Technology". Educause.
- Lyman, Ashley; Stone, Robert (September 2006). "The Use of a Financial Trading Room to Teach Risk Management". Journal of College Teaching & Learning. 3.
- Druman, James (November 5, 2010). "5 Reasons to Build Authentic Trading Rooms in a Finance College". Ezine.
- Protess, Ben (December 29, 2010). "Where Homework Is Managing a $200,000 Stock Portfolio". New York Times.
- Green, Ronald; Ferreira, Eurico J.; Sinha, Amit (2006). "Trading Room Educational Programs: Issues And Recommendations". Journal of Business & Economics Research. 4 (3).
- McLaren, Bruce (2011). "Developing a University Financial Trading Room: A Case History". Indiana State University.
- C., Ryan (February 15, 2015). "How Much are Schools Spending on Stock Ticker Displays?". RISE Displays.