With the Portfolio Management Simulation, this experience is possible for various levels of students and executive education members. Portfolio management is the compilation and management of a portfolio consisting of securities such as bonds or shares. The goal is to meet customer needs and achieve a positive return on investments. While participating at the simulation, players can apply their knowledge in finance and macroeconomics in a portfolio management setting. Further, they learn to construct a portfolio that fits to the strategic and tactical asset allocation of their clients.
The Portfolio Management Simulation (game flow below in blue) follows the investment process in private banking (below in green).
Before the Portfolio Management Simulation can be successfully applied, it is important to make sure that the students are already equipped with a basic level of the following Prior Knowledge (which they can practically apply during the simulation):
The students playing the Portfolio Management Simulation do not have to be proficient in all those topics and the game itself will provide them with definitions and additional learning opportunities (e.g., in tooltips). If students do not have any theoretical background at all it might end in stress and frustration within teams or for the entire class as well as the teacher. The specific level of required prior knowledge depends on the target group and their specific learning goals.
The Portfolio Management Simulation is primarily designed for students at university level with a significant level of prior knowledge. However, it has been played successfully by other groups of students with a different didactical focus. The different target groups of the simulation include the following:
When applying the Portfolio Management Simulation, we recommend two to three game periods as an introduction to the topic and to get to know the portfolio management process. An extended play of four to six periods is recommended when the goal is to provide an in-depth analysis and learning experience.
Depending on the available time and learning plan, there are different Course Design possibilities.
Within a compact seminar respectively course, the Portfolio Management Simulation play sessions are distributed over one to three days. Lectures on theoretical and practice-oriented topics enrich the seminar.
Within a semester course, the Portfolio Management Simulation play sessions are distributed over a couple of weeks. Lectures on theoretical and practice-oriented topics enrich the semester course.
Within a semester course, the Portfolio Management Simulation play sessions are distributed over a couple of weeks. At the beginning it is helpful to play the sessions in class, but thereafter it is also possible to play the sessions decentralized with a certain deadline per period played. This setting allows for lectures on theoretical and practice-oriented topics during class instead of focusing only on playtime.
Using a simulation like the Portfolio Management Simulation in class allows aiming at higher levels within the Learning Objective taxonomy. For example, instead of a simple multiple-choice exam where the passive knowledge of the students is being tested, students can be asked to apply, analyze and evaluate their knowledge and, e.g., elaborate the outcome of the game.
Any of the following elements or any combination / weighting thereof can be used as an academic assessment:
Assessment Design should be aligned with the Learning Objective and should keep the students engaged and motivated throughout the course. Natural competition between teams (I.e., banks) helps, but should not be the main focus during play.
A suitable Course Evaluation incorporating the simulation itself helps regarding improvement of the course as well as the Game-Based Learning elements.
Possible questions on the example of the Portfolio Management Simulation are the following:
Finally, some feedback from the players of the Portfolio Management Simulation: