Bulls' run over as Young Money take lead in contest

The team pipped BI’s Profit Bulls to the post in the last month of trading — but it is still a close race as they are just $455 better off.

BI’s two teams are in second and third place despite both seeing profits slide by more than $5,000 each in the last few weeks of trading.

There are 15 teams from eight of the island’s schools taking part in the annual KPMG Investment Challenge. Each invests a virtual $50,000 in the stock market for six months, with trading beginning at the end of October.

Accountancy firm KPMG monitors the trading activities and calculates the overall value of each portfolio on the last trading day of the month.

The squad that makes the most cash wins. The champs will be announced in May and the top three teams will receive prizes of $10,000, $6,000 and $4,000.

Since trading began, BI’s Profit Bulls and Tradewins were between $7,000 to $9,000 ahead but dropped back to $55,552 and $55,325 as of January 28.

Despite the setback, the teenagers — all students taking an Introduction to Accounting class — are confident they can win.

As a school affiliated with the Seventh-day Adventist church, their strategy is risk-averse and favours a more careful, methodical approach.

Gambling

Tanya Dickinson, teacher and business manager, said: “We’re cautious and conservative.

“As a church we are taught not to gamble and this is a gambling game but it is a learning experience.

“We’ve learned through this competition that investing in the stock market is very risky, particularly in this economic climate.”

Ms Dickinson said the Investment Challenge is a learning curve and a valuable introduction to the world of finance.

She added: “The students are learning about business and how to choose what to invest in.

“They are recognizing that if you are struggling financially and trying to make ends meet, it is better to shy away from the stock market.

“But if you are investing, it may be safer to invest in mutual funds with a proven history of succeeding.

“This is not a lazy game. You have to be on top of it every day keeping a watchful eye on stocks and investments.”

This is the fifth year BI has entered the contest.

Ms Dickinson said: “The first year, we ended in fourth place, the second we placed third and the last two years we have come in second place.

“This year we are hoping for first place. We think it’s about time.

“We’ve actually stuck with a lot of the same stocks from last year, which we could see were still working.

“We don’t buy high-priced stocks. We stick with lower priced stocks that are doing well.

“When we first started we bought Apple stock. Three years ago it was about $89 but now it has gone up to $300 or so, so we weren’t able to use that this year as the price was too high.”

If BI wins a prize, the school intends to put the money towards its scholarship fund.

Ms Dickinson said: “We will use it for financial aid for those students less fortunate, to help them with their tuition.”

BI only has five students taking part in the contest, split into two teams.

Ms Dickinson said: “We thought we would have a better chance of winning with two.

“The first, second and third prizes have to go to three different schools, so even if we placed first and second, we would only be able to take one prize.

“We have a better chance with two teams, rather than putting all our eggs in one basket, as it were.”

The Profit Bulls consist of Aquil Clarke, 16; Shennen Rollins, 16; and Jamae Smith, 17.

The team has invested predominantly in gold, oil, retail and mining.

Ms Smith said: “We look at the Yahoo financial charts, which also have links to articles, showing how the company or product is doing.

“We’re just going with what works. If it works we won’t change it, we will leave it as it is.

“In this competition, we’ve learned the importance of research and teamwork. We feel confident we can win.”

Tradewins consists of Samara Wilson and Reglindis Ratteray, both 17, who have invested in retail, pharmaceutical and mining stocks.

Ms Ratteray said: “Before choosing a stock we have looked at its history, to see whether it has gone down or whether it has a history of rising.

“But the stock market is so unpredictable right now we may have to switch some of our stocks out sooner or later.”

Samara added: “We’ve learned that the stock market is pretty much a gamble. It is definitely something you have to pay close attention to.”

As of January 28, Young Money is ahead of the pack with a portfolio worth $56,007.

Profit Bulls are second with $55,552 and Tradewins third with $55,325.

Portfolios

Wanda Armstrong, KPMG spokeswoman, said: “Young Money’s success in the period was largely built on their investments in the consumer, cyclical and energy industry sectors, taking advantage of the rise in the stock prices of Halliburton and Quanta Services.

“This is in contrast to the Bermuda Institute’s teams, Profit Bulls and Tradewins, who saw their portfolios fall by 10 and nine per cent respectively.

“This is attributable to their investments in basic materials and, in particular, the decrease in the stock price of Silver Wheaton during the period.

“The current trading results of the teams were mixed with the majority of the portfolios making gains.

“U.S. and international markets experienced overall positive performance for the trading period ended January 28, 2011.”