Impressive Results in the Bloomberg Trading Challenge!
Marymount School is thrilled to announce that we placed 10th out of 395 teams in the Bloomberg Trading Challenge! Marymount competed against 205 colleges and universities from across the nation. Each team developed an investment strategy based on market assumptions, validated its beliefs through Bloomberg functionality, and executed simulated trades on a closed Bloomberg network to generate the highest Sharpe ratio at the end of the eight-week period in mid-April.
When the challenge began in early February, the Marymount team took a cautious approach at first because the VIX reflected a surge in volatility in the markets. With a $1 million notional amount to invest, the team executed its first trades on March 8 when volatility had died down. Team leader Connie C. ’18 explained their strategy: “As the dollar had weakened year-to-date, emerging market equities held up relatively well compared to other markets, supported by strong GDP and corporate earnings growth. We [further narrowed our focus] by identifying that robotics and fintech companies would have the greatest growth potential in this period of rapid technological change and globalization.”
To generate the highest returns during their five weeks of trading, the team constructed a high-risk portfolio by investing heavily in tech shares after observing that tech companies deliver promising positive short-term earning trajectories; a recent fall in tech shares was a good buying opportunity for the team. “According to the S&P 500, the IT sector had the highest returns YTD in 2018, so we put 80% of our money there,” Connie explains. “The U.S. stock market also experienced its first monthly drop since October 2016 in February, so we invested primarily in companies from emerging markets like China and Brazil. Our biggest outperformers were two IPOs in those markets.”
Marymount’s impressive finish in the Bloomberg Trading Challenge was an outstanding end to the first year of our new financial literacy program. We look forward to expanding the program to even more Upper School students next year!