The Student Investor Challenge is the UK’s premier investment competition with over 400,000 students from 2,500 schools benefiting from this unique experience to simulate trading on the stock market. British international schools are allowed to participate in the first round and it was pleasing to see over 50 pupils taking part from MCM. Two of our teams came in the top 2%, which is no small achievement given the volatility created by the US-China tariff war and the debacle of Brexit and fears of a “no deal”.
In the Lower Sixth, Adrianna Adam, Jonathan Yip and Janne Schultz came 94th out of over 5,600 teams and a group of Shell boys comprising Bhathiya Ralapanawa, Matthew Ong, Nelson Schwalb and Ethan Choi ranked 56th overall, and won the MCM competition by some distance. Both teams spoke in assembly and told their peers their secrets on how to beat the market. They spoke eloquently and with immense knowledge about investing. It was a pleasure to listen to our young people engaging with such an important life-skill that will undoubtedly serve them well in the future.
Congratulations to all of those who participated and we hope the competition continues to provide students with an early introduction to the risks and rewards of the financial markets.
All the way back in the Michaelmas Term, we participated in a challenge called the Student Investor Challenge. We were persuaded by the glamour of being given £200,000 and the ‘legal gambling’ aspect of trading. It also sounded great for future careers and our curriculum vitae.
However, the practice round didn’t go too well for us. We hit a low of £87,000 due to some risky investments made and some dubious advice from one of our Dads! Moreover, our teamwork was all over the place: we didn’t communicate with one another very much and most importantly we were still all “newbies”. At the end of the practice round, depressingly, we placed 3,645th out of 3,996 teams.
When the real game began, we had the taste for the game and we couldn’t resist the temptation for more. We began to work as a team and we finally made some major strides in our trading. Failure is the mother of success and we now had a ground-breaking strategy and knew what to invest in. We looked for companies that often fluctuated; we attempted to catch them while the stocks were low. We were still oblivious about how to cut our losses, so we suffered some major hits in the active portfolio. But still, against the odds, we managed to come 293 out of 5,622 teams. Our eventual profit was £2,317.32, which beat both the FTSE and the high-interest savings rate for the same period.
In our strategic portfolio, we were only allowed to trade 10 times a month, so we had to invest more long-term. We checked company debt compared to net income, dividends, industry, growth, and if the company was undervalued or overvalued. We needed to check thoroughly because we did not want to lose big sums. IQE plc. was our biggest win. It had no debt, it was massively undervalued and had a huge drop after steadily rising for 2 years. We bought as much as we could and made over 30% profit! Buying stocks after thorough checks seemed to help and we came 69th out of 5,622 teams, going from £100,000 to £105,554.88.
Across both portfolios, we came 56th out of 5,622 teams and beat many other prestigious schools along the way. From this experience, we learned how to analyse stocks; we learned when to buy and when to sell. On a more important note, we learned how to co-operate and have trust in one and other. We have achieved tremendous growth as people. We have grown from arguing and distrusting each other and have accepted that everyone makes mistakes sometimes. The challenges we did face were being brave enough to cut losses, spending a large amount on one investment, trusting each other and not judging one another’s investment. Altogether, it was great fun and a great experience and we thank Mr Tapp for bringing this challenge to us.