Fantasty stock market trading game launched by nebusiness.co.uk

Feb 25 2009 by Graeme King, The Journal

Click here to take part in the Taking Stock game >>>

TODAY we launch our fantasy stock market game, Taking Stock, on our website at www.nebusiness.co.uk. Graeme King speaks to the experts at sponsor Brewin Dolphin to get some tips – and finds out why investing is still a wise move, despite current turmoil.

AT a time when it’s easy to get downhearted about the investment market, Taking Stock offers a chance to "play" the stock market without putting anything at risk – and who knows, you may develop some skills which lead to you making a real life million.

Taking Stock is highly realistic, with game players offered a wealth of financial information about the stocks before they make their purchases.

When you make a purchase with your £100,000 in virtual cash, you even have to pay stamp duty as well as a broking fee. Then sit back and watch your investment either grow or tumble in value as the market sees fit.

Vinay Bedi, divisional director of Brewin Dolphin in Newcastle, said the game offered a great insight into the business of trading shares.

“With this game, to win it, you will probably need to take bigger risks than in a normal investment portfolio, and the more normal critical factors such as income needs can be largely ignored. However, you still need to create a degree of balance within your portfolio,” he said. “You don’t just need judgment to select individual stocks, you also need to get the timing right, to ensure you are in the right areas when the market turns upwards.

“A game like this makes you follow businesses more closely, you almost become an amateur research analyst. It pays to have an inquisitive mind – asking questions as to why certain products or concepts work.”

Mr Bedi said though it had been a tough time for the world’s markets in the past year or two, some commentators believe it won’t be long before the markets start to recover – and that will also be a sign of when the wider economy will pick up.

He said: “This is an ideal time to be launching a game like this as, at some point, the market will have a bounce. Some say it could come shortly, though certain pessimists say not for up to a year yet. In the last two recessions, in the early 80s and early 90s, the stock market fall bottomed out early, and the recession ended roughly 12 months after the stock market had turned.

“There was a lag between the stock market hitting the bottom and the economy starting to recover.”

So how do our amateur investors choose when to invest?

“One of the standard methods of investing is to monitor and follow a few favoured stocks or sectors very closely for a period of time. You get a feel for how they are moving, then you can time short-term purchases.

“The game will offer the opportunity to monitor certain stocks, in a dummy portfolio, for a period of time, prior to maybe investing.

“When the stock market starts to show signs of a recovery, then within reason it could well be anticipating a recovery in the economy.”

So when that time arrives, and the stock market is beginning an upward turn, do we buy the same stocks as we normally would, or do different rules apply?

“At the point where recovery begins, you don’t want to be in defensive stocks that people have been favouring over the past year or so, eg utilities, tobacco or pharmaceuticals. These may still go up, but will almost certainly underperform more aggressive areas.

“You would buy stocks that are maybe considered risky now whilst perhaps focusing on those that will grow as government money comes in – construction and building, which will be good for this region too. Also, aerospace, travel, tour operators, rail operators, automotive, motor retailers. Those sorts of areas will offer the biggest attractions.”