1. Trading Dates & Initial Cash Balance:
The Florida Stock Market Simulation Spring 2016 Semester runs from February 8 to April 15. The advisor will choose the trading period (within the given timeframe). To be eligible for the competition, you must complete a minimum of 3 transactions during the entire trading period and be registered for a minimum of 7 weeks. Each team will begin with $100,000.
2. How To Trade:
Before making any transactions, you must have your team number, password, and the ticker symbols of the securities you wish to buy/sell.
3. There are Two Versions of the Program:
The Internet version: Florida SMC Home Page. Visit our home page to submit transactions, review your team's activity, research stocks, obtain quotes, find ticker symbols, and review your team's ranking. This is the best way to transaction because it is fast, accurate, and convenient.
Investing in Stocks: There are four basic ways to transaction stocks: buy (BO), sell (SC), short sell (SS), and short cover (CO). When buying a stock, you are taking a "long position" with the hope that the price per share will increase. When you sell a stock, you close or reduce that long position. Selling short is selling a stock that you don't own (you actually borrow the stock from the broker) with the hope that you can later buy the stock back at a lower price. When you buy the stock to pay back what you borrowed, it is called "covering" your short position. To buy or short sell a stock, specify how many shares you want, rather than how much money you wish to spend.You may not be long and short in the same stock at the same time. Day trading is not allowed.Duplicate transactions on the same day are not allowed.
Investing in Bonds: Florida SMC allows you to buy or sell bonds. Bonds are notoriously difficult to research. A selection of Corporate Bonds, Treasury Bonds, Strips, and Bond Mutual Funds is listed on the bond transaction screen. All bonds have a par value of $1,000. When you buy a bond, you must pay the accrued interest on the bond. On your statement, the accrued interest and commission are added together. You cannot short a bond. Portfolios will be evaluated to see whether purchased mutual funds also contain bonds. If so, teams will be contacted by the program coordinator, Cheryl S. Geslani, via email to notify them on an on-going basis of their true allocation.
Investing in Mutual Funds: Florida SMC allows you to buy or sell mutual funds. Mutual funds are transacted in dollar amounts not by number of shares. Mutual funds must be bought or sold in lots of $500. To sell off all of your mutual fund shares enter a “99999” in the box for dollar amounts. Like stocks, in order to buy or sell mutual funds you must have the ticker symbol. All mutual fund ticker symbols are five letters long ending in "X".
4. Investing Times and Prices Received:
Stocks: Trades made via the web page will receive 15-20 minute delayed prices if placed while the market is open (generally 9:30 a.m. and by 4:00 p.m. EST). Transactions placed after the market has closed will receive the next day's open price. Transactions made via fax and received before the market close will receive that day's closing price. Transactions made after market close will receive the next day's closing price.
Bonds: Orders placed via the web page will receive end of day prices. Orders placed via fax and received by market close will be executed at that day's closing price. Orders received after market close will receive the next day's closing price. Since bonds pay interest via coupons, when you buy bonds in between coupon dates, you must pay accrued interest. You will earn interest at the coupon rate while you continue to hold the bond. If you sell your bond during the simulation, you will receive all that accrued interest.
Mutual Funds Mutual funds are always transactions at the end of day prices (NAV or net asset value). Transactions received before market close will be placed at the closing price for that day. Transactions made after market close will receive the next day's closing price.
5. Splits and Dividends:
All stock splits and all dividend payments over $0.10 will be credited to your portfolio. Splits that have been credited to your portfolio have the appearance of a buy or short sell, but the price per share is $0.00. Dividends will appear in your portfolio with a “DIV" attached to the ticker symbol. In order to receive a split and/or dividend, a team must have a current open position in the stock by the Ex-Date (The ex-date is usually two business days before the record date. It is indicated in newspaper listings with an x.). Splits and dividends will be posted in accounts by the "Ex-Date."
6. Securities that can be bought or sold:
Stocks: You may buy, sell, sell short, and cover a short almost all NYSE and NASDAQ-AMEX stocks (common and preferred) that are trading at $5.00 or more and have a current reported volume of at least 10,000 shares. IPOs are usually available within 48 hours of the day the stock starts trading on the exchanges.
Bonds: The bond transaction page has a limited set of 103 bonds that participants can choose from. All bonds have a par value of $1,000. You cannot short a bond.
Mutual Funds: You may buy and sell any of the U.S. Mutual funds listed, regardless of the price (No $5.00 minimum price as with stocks.
7. Volume and Purchase Restrictions:
Throughout the simulation, teams may invest nor more than 25% of their portfolio in any one stock. For example, if you buy $25,000 in any one stock and the price increases, you are not required to sell any portion of that stock to remain at $25,000. Teams may not buy or short sell stocks trading for under $5 per share (no penny stocks). The maximum number of shares a team may transact is limited to one-half of the actual volume for that day. All stocks have a 25 share minimum but do not have to be in multiples of 25 shares per transaction. For example, you can now buy 26 shares or 157 shares, but not 24 shares. Mutual funds must be transacted in lots of $500.You may not hold a short and a long position in the same stock at the same time. Duplicate trades on the same day are not allowed.
8. Ticker Symbols:
You need to know the ticker symbol for the security before you can buy or sell it. Please note that most local newspapers show only the abbreviation of the company name, not the ticker symbol. The Wall Street Journal and the SMS web page are two really good sources to help you find the ticker symbols you need. You can also find links on our research page that will help you find a certain ticker symbol.
A broker's commission is applied to most transactions. The commission for stock transactions is a flat fee of $25 on each transaction regardless of the number of shares. If you sell one stock and buy another you will be charged two commission fees. Mutual funds are not charged a commission.
10. Margin Requirements:
The margin requirement for the simulation is 50%. Initially, this means that since you are starting with $100,000, you may borrow another $100,000, making your total buying power $200,000, minus commissions. You may buy and short sell stocks on margin.
11. Interest Earned:
Interest will be earned on all available cash balances and credited at the close of each day. During the simulation, cash balances will earn 3% interest, compounded yearly.
12. Interest Charged:
Interest will be charged on all loan balances and will be debited at the close of each day. During the simulation, loan balances will be charged at 8% interest, compounded daily.
13. Portfolio Statements:
Team activity or portfolio statements are available on the internet at www.Floridasms.com 24 hours a day. Students are encouraged to print these off periodically. It is important to keep copies of the statements received since they cannot be reprinted. Team activity and team rankings are updated every business day on the web page.
14. Number of Transactions:
Each team is limited to 200 transactions during the 10-week period. Each buy, sell, short sell or short cover counts as a transaction. For example, if you buy a stock and sell another stock you will be charged with 2 transactions.
15. Competition Eligibility:
Teams wishing to be eligible to be declared winners must follow this rule: Teams must have at least 3 investments in their portfolio by the end of the 4th week of the simulation, and must continue to hold at least 3 for the remainder of the simulation. Teams may also not invest more than $25,000 in any one stock during the simulation.
16. End of the Simulation:
You do not need to convert all of your investments to cash on the last day of the simulation. Your portfolio will be valued at the closing prices for that day. Official winners of the simulation will be notified by the Stock-Trak.
17. Disputes and Errors:
If you and your teacher believe an error has been made in your portfolio, your teacher may call STOCK-TRAK @ 1-866-SMS-DESK, toll-free, to discuss the problem. Please review your statements and report any problems right away.