Students compete in stock-trading competition, finish 11th of 97
By Bailey West
April 8, 2010 10:30 p.m.
Members of the Undergraduate Stock Trading Society will be running laps around Drake Stadium in the near future.
The group itself has nothing to do with running. However, the five-person team stipulated they would run laps if they did not proceed to the next round of a recent national stock trading competition, said Kenny Lee, a fourth-year economics student and the group’s co-founder.
The team placed 11th out of 97 teams, beating out teams of graduate students, but only the top four teams proceeded to the subsequent round, Lee said.
He explained that students used professional software to trade crude oil and gold futures in the virtual stock trading competition through the Chicago Mercantile Exchange. The event took place from Feb. 18 to March 4.
Crucial errors in the beginning of the competition led to the group’s rapid loss of capital, from the original $100,000 to $80,000 at the start of the competition, said co-founder Carl Abuan, a fourth-year economics student.
But through their continued efforts, he said they ended the competition with $141,000 in virtual capital, a 41 percent increase from the start of the competition.
“During the competition, we realized many things that professional traders cope with, including the volatility of the market and dealing with lots of money,” Lee said.
As an example of the market’s unpredictability during the competition, Lee said the group lost $1,000 within 10 minutes of buying a contract.
However, he said he tried to stress the importance of keeping emotions steady despite the ups and downs of the financial market throughout the contest.
“I thought it would be easy to separate my emotions from my actions, but when you’re losing 10 percent of your team’s capital, that changes,” said team member Justin Lai, a second-year business economics student.
Because the winner would receive a stock market internship in New York City, Abuan said his team was playing to win and was disappointed as a result of not moving on to the next round.
In the end, though, he said he was pleased with the final result.
“It seemed that there was no way we could win. We went from being ranked 100th to 11th, so it was a pretty amazing experience,” he said.
Although the group made crucial trading mistakes on the final day of competition that moved them out of contention for a spot in the top four, Lee said he was still pleased with their results.
Team member Anthony Liu, a fourth-year political science student, said he was proud of the team’s ability to beat teams of graduate students.
“That says something about our analytical skills and teamwork. We beat MIT and other “˜brand-name’ schools,” he said.
Melanie Gin, a second-year business economics and political science student, said she looks forward to participating in more competitions when she takes over leadership of the group after Abuan and Lee graduate.
“I joined the group because I was interested in the stock market, but it’s the people that made me come back to the club,” she said.
Students who are interested in the financial world can find a home with the society, Liu said.
“This group is somewhere that I can be myself and talk about stocks and trading,” he said. “Elsewhere, no one will talk about it with me because they find it boring or complicated.”
Lee said he founded the group because there was not a place for undergraduates to learn about finance in a real way on the UCLA campus when he was a freshman.
“It’s important for students to lead and facilitate discussions about the stock market without being intimidated by talking to brokers somewhere like Charles Schwab,” he said.
Abuan said he feels his group is his way of giving back to the UCLA community that has provided him with so many opportunities.
“If (I) can do something I love, helping people manage money and give back at the same time, that’s even better,” he said.
