Prepare for the Fast Money final exam –In this feature we test the trading prowess of some of the most promising business students in the nation.
This week they’re from Cornell, Purdue, UCLA and The University of Chicago. Get ready – school’s in session.
Our business school students have been given the questions in advance, and have 30 seconds to answer.
Grad #1:
Fahim from the Johnson School at Cornell University.
He's got 6 years of microchip design under his belt, and he's the captain of the Johnson school hockey team.
Ok Fahim, here's your scenario: In a surprise announcement, China says it will allow its currency to float freely with the dollar. What are you buying and what are you selling if this scenario unfolds?
Fahim is buying Boeing (BA), Cisco (CSCO), Motorola (MOT) and Caterpillar (CAT) as well as China Southern Airlines (ZNH) He’s selling Petrochina (PTR).
Tim Strazzini says pretty good, but the bond market would have been smoked. He gives Fahim a B+
Grade The Trade - Fahim
Grad #2:
Adam from the UCLA Anderson School of Management.
He already has 4 years of experience in investment banking and equity research. What's more, Fast Money is not his first time on TV - he was once a contestant on "The Price Is Right"
Ok Adam, let's see if you can get the price right on this one...here's your scenario: A computer virus exposes a security flaw in Vista, disabling half of the Vista-loaded PC's in the world for a day. What are you buying and what are you selling if this scenario unfolds?
Adam is shorting Microsoft (MSFT), Dell (DELL), and Circuit City (CC) among others. He’s buying Apple (AAPL), Symantec (SYMC), and McAfee (MFE).
Jeff Macke gives Adam a “A”
Grade The Trade - Fahim
Grad #3:
Nav from the Krannert School of Management at Purdue University.
He's the president of the student managed investment fund and the MBA Nay is working on isn't his first, but his third masters degree.
Let's put all that education to the test. Here's your scenario: "An active hurricane season and summer driving demand doubles the average price of gasoline to more than $5. What are you buying and what are you selling if this scenario unfolds?"
Nav is buying ExxonMobil (XOM), Shell (RDS), Chevron (CVX) and Energy Elect SPDR (XLE) as well as fuel efficient cars. Nav is selling insurance companies, as well as SUV and truck manufacturers such as Ford (F).
Eric tells Nav that he should also short re-insurers too. He give Nav an “A”
Grade The Trade - Nav
Grad #4:
Fausto from the University of Chicago Graduate School of Business
Fausto's background is in commercial real estate and he's an avid traveler, having hitchhiked through most of Europe and North America.
Ok, here is your scenario: The first baby boomers will be retiring in four years. Not so fast. In order to save social security, congress passes a law raising the retirement age from 65 to 70. What are you buying and what are you selling if this scenario unfolds?
Fausto is buying big fixed income players. He’s selling leisure companies such as Royal Caribbean (RCL).
Guy Adami adds in the scenario Zimmer Holdings (ZMH) is a buy, because it's in the health care space. He gives Fausto an A-.
Grade The Trade - Fausto
Questions? Comments?
Trader disclosure:
On APR 27, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders; Strazzini Owns (IBM), (JBLU), (MPEL), (PG), (T), (WMT) Bolling Owns (MPEL), (BP), (XOM) Gold, Silver, Corn Bolling Is Short Soybeans; GE Is The Parent Company Of CNBC