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From: naparst@cartan.BERKELEY.EDU (Harold Naparst)
Newsgroups: net.invest
Subject: Re: Stock Contest Comments
Message-ID: <12805@ucbvax.BERKELEY.EDU>
Date: Sun, 30-Mar-86 15:06:26 EST
Article-I.D.: ucbvax.12805
Posted: Sun Mar 30 15:06:26 1986
Date-Received: Tue, 1-Apr-86 08:15:17 EST
References: <1962@trwrba.UUCP>
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Reply-To: naparst@cartan.UUCP (Harold Naparst)
Organization: University of California, Berkeley
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In article <1962@trwrba.UUCP> suhre@trwrba.UUCP (Maurice E. Suhre) writes:
>It would seem that the strategy for no-money stock contests is to
>pick some risky stuff and hope you hit.  Sort of like long shots
>at the track.

Yes, this is true.  That is why I recommended that only NASDAQ, NYSE, and
ASE issues be included in the contest.  I posted this a couple of weeks ago.
Perhaps this will cut down on the volatility of the contest.  Also, if the
contest is long-term, people will be forced to choose value and growth rather
than a short-term play.

>Finally, what does this contest prove?  Or accomplish?

  This is a tough question, but I think I see two answers.  First, it may be
fun.  But most importantly, the results of the contest may point out which
industries are doing well, and in particular which companies are growth 
leaders.  These are the major goals of investment research.  You may say,
"But I can find out which companies are doing well by looking at stock charts"
True, but it may be more graphic if you see (as in the BARRON'S contest)
that the winner had the foresight to invest 20% of his money in each of five
medical imaging companies, and some of these companies experienced 250% 
earnings growth.  That is useful information.  And it is free.

ucbvax!brahms!naparst	Harold Naparst/UCB Math Dept/Berkeley CA 94720