In "Grade The Trade" we test the trading prowess of some of the most promising business students in the nation. This week they’re from Dartmouth, Carnegie Mellon, Georgetown and University of Michigan. Get ready – school’s in session.
Our business school students have been given the questions in advance, and have 30 seconds to answer.
Neeraj from the Tuck School of Business at Dartmouth
He speaks 5 different languages - lets see if he can translate his trades to an "A."
Here is Neeraj’s scenario: Hurricane season is more violent this year, with 5 major storms hitting the eastern seaboard. What are you buying, what are you selling?
Neeraj is buying Home Depot (HD), Lowe’s (LOW) and other commodity futures. And he’s selling airlines such as United (UAUA) as well as insurance companies including Allstate (ALL).
Guy Adami gives him an “A.”
Arthur from The Carnegie Mellon Tepper School Of Business
Arthur is president of the Graduate Finance Association and will be interning at Deutsche Bank this summer. Lets see if he can be elected winner of grade the trade.
Here is Arthur’s scenario: Alan Greenspan is correct and we fall into a recession in the fourth quarter. What are you buying, what are you selling?
Arthur is going long streetTRACKS Gold Trust (GLD) and shorting General Motors (GM).
Karen Finerman gives him an “A-“. She’s says good but not fantastic.
Liu-Yue From The McDonough School Of Business At Georgetown University
Liu-Yue has 8 years of investment management experience and is an amateur magician. Lets see if he can make some magic tonight on grade the trade.
Here is Liu-Yue’s scenario: Sanofi-Aventis' (SNY) Acomplia weight loss drug is released with results yielding large scale and consistent weight loss in the US. What are you buying, what are you selling?
Liu Yue is buying SNY, McDonald’s (MCD) as a play on junk food, and Victoria’s Secret (LTD) as a play on confidence. He’s shorting Weight Watchers (WTW), NutriSystems (NTRI) and plus sized retailers like Dress Barn (DBRN).
Jeff Macke gives him an “A” and says “that was rock solid.”
Eugene Suk From The Stephen M. Ross School of Business at the University of Michigan
Eugene is a "CFA Charterholder" and a student career counselor. Lets see if he can provide the right advice to win grade the trade.
Here is Eugene’s scenario: As geopolitical tensions in the Middle East heat up, Iran decides to close the Strait of Hormuz. Oil gaps to $100 over night. What are you buying, what are you selling?
Eugene is selling American Airlines (AMR) as well as iShares MSCI Japan Index (EWJ) and The MSCI Korea iShares (EWY) and he’s buying of Apache Corp (APA) on the news.
Eric Bolling gives him an “A”.
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Trader disclosure: On May 11, 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders
Bolling Owns (ICE), (NMX),Gold, Silver; Finerman and/or her Firm Owns (BBI), (KBR), (HD), (FLS), (CX), (ASD), (WMT), (TYC), (GS), (INWK); Finerman's Firm Is Short (HAL)