Stock Market Challenge

Sumner Jones, Staff Writer

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Last month, the fall Ohio Stock Market Challenge began. For those who do not know what this is, it is a real-time stock market simulation game in which you try to yield the highest % return by the end of the contest. Many students usually end up with close to a 0% return; however, there are also many who end up significantly higher than others. For example, last year the first, second, and third place teams ended up with a 21%, 13%, and 12% return, respectively. The entire game is mostly based around luck. Economist Burton Malkiel states that “a blindfolded monkey throwing darts at a newspaper’s financial pages could select a portfolio that would do just as well as one carefully selected by experts.” This being said, there have been students who have done extraordinarily well by investing in Nike because they like Nike shoes, in Buffalo Wild Wings because they like the wings, and in Apple because everyone owns an iPhone. However, one’s success isn’t entirely predicated on luck. There are strategies that have been proven to work but yield high risk at the same time. For example, investing in penny stocks is a strategy many use to make small amounts of money, but at a higher frequency. This involves investing around $20k in a certain penny stock, waiting till it goes up a few cents, and then selling it – this strategy can produce a surprisingly large amount of money. Another strategy which is safer but usually yields a smaller return is investing in mutual funds. A mutual fund is essentially a mix of many different stocks. This is safer because if one stock tanks, you should still be fine. In my own personal experience, I have found this strategy to be the most effective. In the end, to be successful in this competition, it is about how much money you don’t lose, not about how much you make. Let others make the mistakes that allow you to win.

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Stock Market Challenge