A Commitment to Daily Updates/Fordham Stock Market Challenge 2008-2009

At 9:30 this morning, Fordham University kicks off its 2008-2009 Stock Market Challenge. Fordham’s top undergraduate traders/investors will face off in a competition to crown the “best investor” of the University. Given the contests strict parameters, in reality, the competition is more of a “best stock-picker” competition, if anything. The rules:

Start Date: Monday, Nov. 10
End Date: Friday, March 13
Initial cash balance: $100,000
Individual position limt: $10,000
Maximum # of trades: 100
No daytrading
No futures or options trading

The restriction to what amounts basically to stocks and ETF’s only won’t affect me nearly as much as the curbs on trading frequency and portfolio concentration. Pulling the trigger on a single trade in this competition is going to require a pretty complex calculous.

With that said, I’m relying on what has been for me a historical ability to correctly predict macroscopic economic trends, and successfully capitalize on them with well-timed trading. Of course, the importance of timing here is unusually important. While I usually try to maximize beta exposure to securities I feel have superior alpha values, my instincts are telling me to temper my giddiness, at least at this competitions beginning. I am going to give careful consideration to the risk of utilizing the contest’s available margin (2x), and do my best to restrict myself from the triple-levered ETF’s. Well-paced and steady will win this race, especially considering the contests relative length.

I’m going to do my best to update this blog every weekday, at least for the duration of the contest. Along with my general outlook, I’ll periodically include my thoughts on particular securities, and developments in Fordham’s contest. Despite irregularity in my commentaries,  I will post my daily returns from my broader (non-contest) portfolio daily. I’ll do this by adding my portfolio snapshot/performance from UPDOWN.com. Since May of 2008, when I began tracking my performance, the results have been absolutely phenomenal. I have returned 317.29%, equal to 609.55% annualized.  Below is the chart of my performance. Click to enlarge.

 

Sean Butler's Performance from May 2008

  As you can see, while the market has lost over 30%, I’ve gained over 300%. Not bad for an amateur. I will discuss this remarkable performance in coming posts, but now, I must run. I will update on the start of the competition this evening.

Sean