Wiley Fall National Challenge: What are the winners’ strategies?

During Spring and Fall, StockTrak, together with Wiley Efficient Learning, promotes the National Challenge. Students are challenged to manage a million-dollar portfolio and generate profits over four weeks. We spoke with the winners to better understand their tactics and strategies in the challenge.

StockTrak: Tell me a bit about yourself.

Mark, 1st place winner: My name is Mark D. I am currently a finance graduate student at Northern Illinois University. I am the Vice President of the Investment Association and President of the Financial Management Association Chapter at my university. In my spare time, I enjoy reading books, investing, and traveling when conditions permit so.

David, 2nd place winner: My name is David A, and I currently reside in Wilmington, Delaware with my Wife, Eri, and daughter Amaryah. I have lived in Delaware for over 20 years now, obtaining most of my education here before college. I attended undergraduate school at Lafayette College in Easton, PA, graduating in 2008 with an Economics and Business degree. While in school, I was a part of some investment clubs but never actually invested in any stocks with real money. I started my career in banking in 2008 during the Great Recession. I worked in various banking roles within Retail Banking, Consumer Lending, Operations, and Small Business. Today, I am an Approval Officer for Bank of America and a part-time MBA student at the University of Delaware with a double concentration in Finance and Business Analytics.

Jake, 3rd place winner: My name is Jake M. I am a junior at Colorado Christian University. I am a double major in finance and biology – and that is an exciting combination. I am a passionate learner: I love to learn different topics, no matter what it is. When it comes to a degree, I wanted to have both financial strength and scientific background. I am the Financial Investment Club president at my university, and I also love to play baseball.

Sammy, 4th place winner: My name is Samuel K, and I am a Senior at Sam Houston State University. I am a double major in banking and finance, and I have always had a passion for investments. I am also the president of the Investment Club at Sam Houston State University. Trading is a passion of mine.

ST: When did you start using Stocktrak?

Mark: I started using StockTrak in January 2020. I was impressed by the ability to trade options and futures on the platform. I loved that StockTrak provides many resources for individuals to enhance their knowledge on various financial topics.

David: I have been using StockTrak since Fall of 2019. My first contact with the platform was during an investment analysis and portfolio management class. I was impressed by StockTrak in general. It is easy to navigate and to learn some of the functionalities.

Jake: I started using StockTrak during the National Challenge. The platform is very friendly and easy to use. Stocktrak has many courses where you can learn about investing. If you have no prior knowledge, you can find various ideas on how to run your portfolio.

Sammy: I have been using StockTrak since Spring 2019. I also used it for a derivatives class this Fall and joined the Wiley National competition. I made over 700 trades this Fall on StockTrak.

ST: How much did you know about investing before using our virtual trading platform?

Mark: I considered myself knowledgeable about investments when I started utilizing StockTrak. However, it was great to use these simulators for practice. I utilized the platform to implement different trading strategies in my repertoire.

David: I have been an on-and-off investor since 2009. My first stock that I bought was the Bank of Ireland, around 12 years ago. I made a small profit and have been hooked ever since. It is funny because, in 2015, the Bank of Ireland was delisted from the NYSE because of low ADR trading volumes. I am glad I no longer own that one.

Jake: I knew a decent amount about investing. I have pretty much been a self-study investor. I run my small portfolio and have taken a few classes about investing. I would not say that I am an expert, but I am learning more and more every day. I am also trying to get more acquainted with markets, gain more knowledge, and make better-educated decisions.

Sammy: My grandpa taught me about stocks when I was 10, so I bought my first stock at that age. I was just really interested in learning how the market moved and how you can compound returns. I wake up every morning at 5.30, and I am excited to check what the market’s doing. It is something I love to do.

ST: How has StockTrak impacted your education?

Mark: StockTrak has provided many valuable articles and resources that I have referenced from my time being a Finance major, in addition to the hands-on trading simulation aspect of the platform. The articles and resources are very insightful and useful.

David: StockTrak showed me that I could successfully compete in the trading world. I met some traders through the competition, and we shared our information on LinkedIn. So, it was a good networking opportunity as well. I also enjoyed the education aspect of it. I could learn everything, from the first stock exchange to how to improve my resume. StockTrak helped to narrow down my view of what I wanted to do after school.

Jake: Before I started using StockTrak, I was trading based on “technical” (technical analysis). After going through many lessons, the platform taught me to be a more balanced investor and ultimately helped me get significant gains.

Sammy: I found it very helpful! I like the Certifications Center because I could find information about Series 7, Series 6, SIE. Before using StockTrak, I did not know precisely what those were. It is very informational in terms of career opportunities in finance and job postings. StockTrak has a very streamlined process of picking stocks and how to do fundamental analysis and technical analysis. There are many different tools on the website, which is super helpful, especially for getting into the stock market, and does not necessarily know what they’re doing.

ST: What were your strategies for setting up your winning portfolio?

Mark: My strategies for winning this simulation contest were analyzing the market conditions, understanding the various catalysts associated with many sectors and overall market movement, and delving into SPACs, Special-purpose acquisition companies, which have seen large returns overall this year.

David: I had two kinds of strategies. The first one was to buy and hold a solid core group of stocks that would likely stay in my portfolio during the full duration of the competition. This core group consisted of companies that were generally successful during the COVID crisis, such as Zoom, Pinterest, and Shopify. My thought process was that the COVID crisis would not be over within the short 3-month time frame of the competition. Therefore, these “COVID stocks” would continue to make gains during that period. The second strategy was to trade actively with a more pessimistic view of the market. I observed that some companies would move to the upside 100, even more than 400% in one day, sometimes before lunch. I would target those companies attempting to take short positions and profit from the subsequent days of decline.

Jake: I first started trading based on technicals. However, after going through the course, I decided to change my strategy: break up my fundamentals and split it between fundamental training and technical training. I did in basically my whole portfolio and invested in what is going to change people’s lives.
Once I changed my initial strategy, I started investing heavily in tech, renewable energies, and different companies. After that, I decided to stick to my fundamentals.

Sammy: I usually trade in my personal account. I trade equity options on the mega cap stocks like Amazon and Tesla as well as NASDAQ futures. In the Wiley National Challenge, essentially, I was shorting, micro cap hypo to stocks, so they had run a 150% or 200% a day. I just slapped it with prominent and short positions. In this way, I created higher returns, even with many risks – because if the stock continues running, your losses are unlimited. Mainly, what I was doing was shorting high running stocks.

ST: What was your process for researching and selecting your investments?

Mark: I use StockTwits, the Bloomberg Terminal, and Yahoo Finance for investment research. For this simulation, it was essential to weigh many risk factors. For this contest, I chose stocks that I knew had significant growth potential given the short investment horizon.

David: I had a different approach for selecting my investments for each strategy. For the buy and hold strategy, I did a Google search to find the companies that had benefited from the effects of the COVID crisis. I found Motley Fool to be very informative. Essentially, I looked for companies that benefited from people spending more time at home and businesses shifting their operations to accommodate employees working from home. For the short-selling activity, I looked at the top stock mover lists on Google, Yahoo, etc. I would analyze the stocks that had increased the most, looking to see if there was a justifiable catalyst for the big move. If it was a biotech company, I tended to avoid it as these companies sometimes make legitimate progress in their pursuit of a breakthrough discovery. However, if the catalyst was, for example, “a new CEO appointed” or no news at all combined with very poor financials, I tended to be very skeptical of the longevity of the stock’s success. I would then take significant short positions in these stocks, looking to profit after the stock’s price corrected down to more “reasonable” levels. Those reasonable levels were usually several percentage points lower than the high of the day when the stock was shorted.

Jake: I usually break down my research into sectors. I am going to look at as many companies as I can at the beginning of the day. I am going to look at what is growing and what is falling. Then I watch the market move. After that, I start an Excel form. I do some background research, look at financial statements, check their past activities, and what they will do in the future. By doing that, I can make a more informed and educated decision before investing.

Sammy: For the competition, I would pull up a list of the top gainers on MarketWatch and see what stocks were running. If the stock was up over a hundred percent, I would immediately look to short that stock. Often, these are pumping dump names where all the institutions will get in before the market opens. Pumping the stock up, let the retail investors buy, get excited about it, and then slam it. Essentially what I was trying to do was follow the big institutions and attack the retail investor. There were a couple of instances where I probably took over $50,000 of losses where I was not able to monitor the position very much. It is a high risk, but high reward as well.

ST: What are your career goals, and how do you think having a Wiley Certification will impact your professional career?

Mark: My goal is to find an entry-level position in Finance following graduation. I believe that having a Wiley Certification can improve my prospects as a job seeker. It also showcases to employers that a candidate understands specific financial concepts or topics.

David: My final goal is to move into a career that involves actively trading and/or analyzing equity securities. I currently work for Bank of America, and they have a trading desk and an amazing Equity Research team. I visited the trading desk in New York City, and it was a great experience. The Wiley course is going to help me educate myself more on trading and investments. Having the Series 7 certification is essential for those who want to follow this career, and due to my 2nd place finish in the competition, I will be able to prepare for and take the Series for free!

Jake: I want to go into investment banking, or biotech, and the healthcare sector. That is my career goal. I also have a dream of starting my own company when I’ve built up significant knowledge. The Wiley Certification will play perfectly into my plans because it will be a great display to show what I know. It will protect me and show off my skills to a future employer or any career path that I decide to go into.

Sammy: I love to trade, and that is what I am going into when I graduate in May. I am forming my LLC paperwork so that I can trade full time with investors. Of course, it is a brutal game to be a retail investor against all the institutions, but I have found a way to survive the learning curve. I am at a point where I trade an extensive portfolio, relatively speaking, for someone my age, and I have created good returns. My career aspirations would be to live the life I’m living right now. I have some offers to work for a couple of investment banks in the commodities trading firm, but I will give trading a couple of years. And the certification will help me if I go to an investment bank or commodities trading house. It also looks good on my LinkedIn profile!

ST: Do you have any plans to continue your education?

Mark: I am currently a graduate student, so after I finish my studies, I will be pursuing an entry-level position in Finance. I hope to attain my Doctoral Degree after years of work experience in the industry.

David: I am graduating in December 2021 with an MBA, and I am thinking about a CFA later. I will also continue to educate myself on market dynamics because they are continually changing and evolving.

Jake: My goal is to get a master’s in microbiology and to get an MBA as well. I also intend to get the CFA certificate.

Sammy: I have thought about getting an MSF and Ph.D. because I would like to teach at the college level. Since I’m the president of the investment club, I enjoy helping people. Teaching is a passion of mine, so continuing education in this direction is something I’m looking for.

ST: What advice would you give other students?

Mark: Believe in yourself. Continue to work hard and improve your abilities so that you become more confident in your abilities. Do your research before buying stocks, and do not panic sell if you believe in the company long-term. Do not allow other people to tell you what you can and cannot do. Never lose focus on your long-term vision or your career goals; keep working through trials and tribulations.

David: Do not let your emotions dictate your trades. I know this is a cliché, but it is better to have a clear, logical strategy and to consider the amount of risk you have on the table instead of just acting impulsively. Becoming a profitable trader is a process, so learn from your mistakes and have a clear strategy.

Jake: Trust yourself and your fundamentals. Learn how to pick a strategy and stick with it the whole time, whether your plan is just investing in technicals, whether you are going to be a fundamental investor, whether you’re going to day trade everything every single day. Whatever your strategy is, stick with it the whole time and hold very strong to your core values.

Sammy: A lot of the other students in my classes are afraid to trade size. They would buy one share of Amazon, which costs $3,000. But if you are trading a million-dollar portfolio, a $3,000 stock will not do anything. Do not be afraid to take some risks because it is paper money at the end of the day. You’re learning this way, and there is no negative that can happen. It’s just going to help you learn. Put on multiple positions, do not be afraid of risk, and come up with a plan. It would be best if you have your exit strategy and your stop losses set-up. -stocktrak.com

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