GO
Loading...

Could You Pass Today's Test?

Friday, 1 Jun 2007 | 8:49 PM ET

On "Grade the Trade" we test the trading prowess of some of the most promising business students in the nation. This week they’re from Penn State, the University of Illinois, Ohio State and Washington University.

Get ready – school’s in session.

Our business school students have been given the questions in advance, and have 30 seconds to answer.

Face 2 Face
The Fast Money guys answer your stock questions face to face



Grad #1: Tom from the Smeal College of Business at Penn State

Tom is a surface warfare officer in the U.S. Navy and he’s also Director of Investor Relations for the Nittany Lion Fund.

Here’s the scenario: The strong employment report proves to be the trend and the economy rebounds in the second half of the year to above-average growth. This, however, causes the Federal Reserve to raise rates by a quarter percentage point before the end of the year. What are you buying, what are you selling as this scenario unfolds?

Tom says he’s long the brokers and is buying names such as Goldman Sachs (GS) and Bear Stearns (BSC). He’s selling utilities such as Exelon (EXC), and Chesapeake (CHK) and he’s also selling consumer discretionary stocks.

Guy Adami gives Tom an "A".

  Price   Change %Change
CHI
---
EXC
---
GS
---



Grad #2: TJ from the College of Business at the University of Illinois Urbana-Champaign

TJ worked at a hedge fund in New York and has appeared in BusinessWeek and on CNN.

Here’s the scenario: A glitch is found in the new iPhone, so Apple (AAPL) pushes out the release date for the device to August 20 from June 20. What are you buying, what are you selling as this scenario unfolds?

TJ is selling Apple (AAPL) and AT&T (T) as well as iShares MSCI Taiwan Index (EWT) because iPhone manufacturers are based out of Taiwan. He is buying iPhone competitors such as Samsung.

  Price   Change %Change
VOW3
---
T
---

Pete Najarian gives TJ a “B” because he thinks the scenario presents better longs.

Grad #3: Dimitar from the Fisher College of Business at Ohio State

Dimitar represented his school at the Rotman International Trading Competition in 2007.

Here’s the scenario: U.S. auto sales have only increased once in 2007, in March. As gas prices plateau and the 2008 models roll out, U.S. automakers start to gain traction. What are you buying, what are you selling as this scenario unfolds?

Dimitar says he’s buying auto suppliers such as Delphi (DPHIQ) domestically, as well as auto suppliers abroad. He’s also buying General Motors (GM).

Karen Finerman gives Dimitar an “A-“

  Price   Change %Change
GM
---


Grad #4: Emma from the Olin School of Business at Washington University in St. Louis

Emma is a graduate representative to the Washington University Board of Trustees and -– a professional harpist.

Here’s the scenario: Wal-Mart (WMT) fires Lee Scott and installs Allen Questrom of J.C. Penney (JCP), who focuses on retail and soft goods. What are you buying, what are you selling as this scenario unfolds?

Emma is buying Wal-Mart and licensing firms such as Iconix Brands (ICON) and Jones Apparel (JNY). She’s selling JC Penney, as well as Target (TGT), Kohl’s (KSS) and TJ Max (TJX) believing they would get squeezed.

Jeff Macke gives Emma “B+” but says stay long Target.

  Price   Change %Change
ICON
---
JCP
---
JNY
---
KSS
---
TGT
---
TJX
---
WMT
---

Got something to say? Send us an e-mail at fastmoney-web@cnbc.com and your comment might be posted on the Rapid Recap! Prefer to keep it between us? You can still send questions and comments to fastmoney@cnbc.com.

Trader disclosure: On June 1, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders:
Najarian Owns (MU), (BTU), (AAPL),(KR), (SWY) Macke Owns (SWY) Finerman Owns (AAPL), (CAT), (HOV) Finerman's Firm Owns (DJ), (TOL), (USG), (WMT), (BJ); S&P Puts, Finerman's Firm & Finerman Own (TYC), (HD), (FLS)

  Price   Change %Change
TJX
---
KSS
---
TGT
---
JA1
---
JCP
---
WMT
---
GM
---
EXC
---
GS
---
AAPL
---

Contact Fast Money

  • Showtimes

    Halftime Report - Weekdays 12p ET
    Fast Money - Weekdays 5p ET
  • Melissa Lee is the host of CNBC's “Fast Money” and “Options Action.”

  • Scott Wapner is host of the "Fast Money Halftime Report," which airs weekdays from 12 p.m. to 1 p.m. ET.

  • Guy Adami is a contributor on CNBC's "Fast Money." He also is managing director of stockMONSTER.com.

  • Najarian, the "Pit Boss," is cofounder of optionMONSTER.com, a news site for options traders.

  • Finerman is president of Metropolitan Capital Advisors, Inc., a company she co-founded.

  • Founder of EmergingMoney.com

  • Chief Market Strategist for Virtus Investment Partners & CNBC Contributor

Halftime Report