OBJECTIVE: This project provides an opportunity to get some hands-on experience applying finance theory to real firms.
FANTASY STOCK MARKET GAME: In this project, you will be competing with your classmates in a Stock Market Game in smartstocks.com website. Each group will be given $1million of fantasy money to trade on any of the more than 25,000 stocks and mutual funds listed on the New York, NASDAQ, American, and other U.S. stock exchanges. SmartStocks.com provides a live stock game using real stock quotes. In this project, you will learn on how to trade online and invest in the stock market without risking your hard-earned money. You can test your new investment strategy before trying it out for real. Upon completion of the project, you will learn and apply concepts and principles we have covered in the finance class an incorporate them into your decision making when performing the stock trading.
INSTRUCTIONS: Each group who is playing in the game will have to joinsmartstocks. Each group is required to have an e-mail address and password. Once you have joined the smartstocks, you are ready to play the game.
Please create one email address in order to join the smartstocks and play the game.
How to Play:-
Go to support (drop down menu) on the top of the page to read all required information in order to play. Follow each instruction carefully.
You can buy/sell a minimum of 100 shares per companies. There are no maximum shares to buy/sell. It is all depends on your judgment.
You have to monitor your stock performance in order to find the right time to sell or buy.
You are required to create a table that lists all your activities - buy/sell.
Ranking and grade:-
Smartstocks will rank group performance. Rankings are calculated based upon the percentage increase or decrease of each user's portfolio.
SUBMISSION OF REPORT -
After playing the game for about one and the half months, please submit a report in which you respond to the following questions:
1. Brief introduction on each company that you choose and the reason(s) why do you choose to invest in the company's stock (at least two reasons for each company).
2. Briefly explain three reasons why do you choose your portfolio (portfolio means combination;provide reasons for creating this portfolio of stocks - at least 2 reasons).
3. Provide your plan or goal in table form for each company that you want to invest. Your plan must indicate how many shares you want to buy for the start and provide your reasons.
4. Summarize your transactions over the month stating specifically how many shares you buy, sell and your earnings per transactions. (Put in a table which you can get from the dashboard summary).
5. Based on the summary as per no.4, analyze your performance --- What did you do well and what did you do poorly in your investments over the past month? State which stock gave the highest return and the lowest return and provide the possible reasons for your performance.
6. Based on the group ranking, analyze your performance and compare it to those of your classmates.Analyze your ranking and explain the reasons. (Copy paste the ranking from smartstocks website. The ranking must be on April 28, 2015).
7. In doing the analysis, you may include the following areas: your performance compared to your expectation(goal), are you a good investor, risk return characteristics of the companies and as an investor, any problems that hinder your performance etc).
8. What did you learn from this project? (at least two reasons).