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Could You Become A Big League Trader?

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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 Georgetown University and Georgia Tech.

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: Evan from Georgetown University McDonough School Of Business

Here’s the scenario: Several major money center banks announce that they will have to significantly increase loss reserves in the coming quarters to cover potential subprime fallout. What are you buying, what are you selling as this scenario unfolds?

Evan is buying US treasuries and selling Countrywide Financial (CFC) National City (NCC), Fannie Mae (FNM) and Freddie Mac (FRE). He’s also selling home builders such as KB Home (KBH), DR Horton (DHI) and Toll Brothers (TOL).

Guy Adami says Evan rocks and gives him a “B+”

Symbol
Price
 
Change
%Change
DHI
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KBH
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TOL
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Grad #2: Yoshi from Georgia Tech College Of Management

Here’s the scenario: Advanced Micro Devices (AMD) and Intel (INTC) announce major price cuts in an effort to win market share. What are you buying, what are you selling as this scenario unfolds?

Yoshi is selling the chip sector and buying PC makers for cheaper computers. He likes Hewlett Packard (HPQ), Microsoft (MSFT), MEMC Electronics (WFR) and other electronic companies.

Jeff Macke gives Yoshi an “A-“ and adds in this scenario get long Intel (INTC) as well.

Symbol
Price
 
Change
%Change
SUPREMETEX
---
HPQ
---
INTC
---
MSFT
---
SUNEQ
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Trader disclosure: On July 27th 2007, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s Fast Money were owned by the Fast Money traders;Macke Owns (ATVI), (DIS); Najarian Owns ( C),(GS) SSusquehanna Financial Group Is A Market Maker In (GTRC), (ATVI), (AMZN), (ERTS), (INTC), (KYPH), (VMSI); Susquehanna Financial Group Owns More Than 1% Of (BZH); Gilbert Owns Options In (HOT) Stacey Briere Gilbert Is Chief Options Strategist For Susquehanna Financial Group, LLLP; Gilbert Is Head Of Market Intelligence Research For Susquehanna Financial Group, LLLP; Gilbert Does Not Cover Individual Securities But Does Recommend Trading Strategies