The second annual CMC Markets’ University of Canterbury (UC) Trading Challenge has come to a close, with third-year Computer Engineering student, Harry Dobbs, taking out the top spot with a 280.81 percent return on investment (ROI).

Hosted in association with the UC Investment Society and UC Business School, the challenge allows students to put investment ideas to the test in a risk-free environment and experience real-time, real-world trading via the CMC Markets online trading platform.

Over 100 teams, comprised of individuals or pairs, battled across six-weeks to achieve the greatest ROI on a NZ$100,000 CMC Markets virtual fund – a significant increase from the NZ$10,000 starting account in last years’ inaugural challenge to allow broader portfolios.

Leader-board placings shifted dynamically throughout the whole competition, including into the final weeks, as students experienced the real-world volatility that came alongside the Saudi Arabia oil facility attack and the direct impact on the global financial markets.

A returning participant from last year, Dobbs used a high-risk, high-reward strategy, which saw him at one point reach a 580 percent ROI.

“At first, I used very little diversification and invested primarily in volatile markets. When I established a fair amount of cash, I increased the diversification of my portfolio and invested in more stable products. I learnt how quickly changes can happen in the market… I had an account value increase dramatically after only seven hours due to the Saudi Arabia oil spike – the third-largest one day move in price in the history of oil trading.

“If you’re thinking of participating next year, don’t be afraid to experiment with different strategies – it’s only a simulation and the real benefits of this competition come with the knowledge you acquire. Research every investment carefully, and don’t be scared to utilise some of the more advanced tools the CMC Markets platform provides – it will help you gain an edge over the competition,” says Dobbs.

Competition runner up, with a 169.47 percent ROI, was Lydia Dudson, currently studying her Master of Commerce degree in Economics and Finance.

“I enjoyed this challenge. My group of friends and I did it together for some friendly competition, and it provided some laughs when half of the group lost most of their money. My game plan was fairly relaxed – a lot of it was luck. S&P 500 got me my first big win and then a last-minute trade on DAX got me to second place,” says Dudson.

In third place was second-year Financial Engineering and Economics student Nicholas Ross, who achieved a 117.79 percent ROI, also taking advantage of the markets following the Saudi Arabia oil attack.

“I decided to short sell oil on a relatively small position, making a quick profit after prices had fallen back down accordingly. I also traded a few cryptocurrencies throughout the last couple of weeks and took another short sell position on oil. I’ve learned to be more prepared and keep watch on what is going on in the world economy, especially shortly after such a major incident like the oil attack.”

Dr Jedrzej Bialkowski & Moritz Wagner (University of Canterbury professors), Harry Dobbs (first place winner), Chris Smith (CMC Markets) and Guy Robson (UC Investment Society)

Chris Smith, General Manager at CMC Markets New Zealand, says, “It’s encouraging to see so many students get involved with the competition and experiment with trading across a wide range of instruments. With this year’s larger fund, it was definitely interesting how different students diversified their portfolios and changed their strategy throughout the competition to respond to the volatility in the market. Once again, well done to everyone who participated, and we look forward to next year’s competition where we plan to challenge them with lower leverage.”

Guy Robson, Head of Trading at the UC Investment Society, says, “The Trading Challenge provides students with the opportunity to gain key transferable skills that will assist them to not only become work-ready graduates but also gain the necessary skills to succeed in their future careers.”

Dr Jedrzej Bialkowski, Professor of Finance at the University of Canterbury, adds, “The UC Business School is committed to offering experiential learning experiences for our finance students. The second UC Trading Challenge was an excellent opportunity for hands-on learning of investment and trading processes. It gave students the chance to put their knowledge and skills into action, and understand the complexity of risk-return trade-off.”

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