Details:

•     Weighting: 25%

•     Total marks: 100

• Deadline: 11pm, the 5th of June 2023

This assignment needs to be completed and submitted individually.

Objective: The objective of this assignment is to help students gain hands -on experience in stock trading, develop skills in portfolio management, risk assessment, and strategic decision - making, as well as practice financial analysis.

Description:

In this assignment, students are required to use the Moomoo Australia stock trading app to conduct paper trading on U.S. stocks. Each student will be given a virtual balance of $1 ， 000,000 (one million) USD and a maximum of 10 stocks to trade for a period of three weeks. The students will  be  required to analyze the stocks and  make decisions  based on their research and understanding of the financial markets. The final deliverable will be a report that includes the following tasks:

Task 1: Stock Selection and Rationale (15%)

•    Choose a minimum of 5 and maximum of 10 U.S. stocks to trade.

•    Provide a brief overview of each company, including industry, market capitalization, and recent news or events (the recent one month) affecting the stock price. (5%)

•    Explain the rationale behind each stock selection, including investment thesis and risk factors. (10%)

Task 2: Trading Strategy and Execution (35%)

•    Develop a trading strategy for each stock, including entry and exit points, stop-loss orders, and profit targets. (15%)

•    A minimum of 5 trades must be executed during the three weeks.

•    Document all trades executed during the three weeks, including purchase/sale price, quantity, and date. (Please keep your trading records in Excel and submit them with your primary report.) (5%)

•    Briefly justify each trade decision (buy/sell) made during the trading period. (Please keep your trading records and the brief explanation in Excel and submit them with your primary report. A template table has been included below.) (15%)

Task 3: Performance Analysis (35%)

•    Calculate  and  analyze  the  performance  of  your  portfolio  on  a  weekly  basis  (3 calculations in total at the end of each trading week) by computing key metrics, including total return, standard deviation, Sharpe ratio. (15%)

Identify and discuss the main risks encountered during the trading period.

8.   References:

List all the sources cited in your report, following the referencing style required by

your institution.

Formatting Guidelines:

•    Font: Times New Roman or Arial, size 12

•    Line spacing: 1.5

•    Margins: 1 inch (2.54 cm) on all sides

•    Page numbers: Bottom right corner

•    Headings and subheadings: Bold and numbered (e.g., 1. Heading, 1.1 Subheading)

Assignment Marking Rubric

The marking rubric below will be used to assess the quality of the submitted assignment. Students should use this rubric as a guide to understand the expectations for the assignment.

•     Depth of analysis and understanding of the financial markets (25%)

•     Quality of stock selection and portfolio allocation strategy (20%)

•     Execution of trading strategy (25%)

•     Performance analysis and comparison to benchmark (15%)

•     Reflection on the main risks that you encountered during the trading period (15%)

Note: Students should cite any sources used for analysis and are expected to adhere to the university's  academic  integrity  policy.  Plagiarism  or  copying  from  the  internet  or  other students will result in failing marks.

Total: 100%

Additional Considerations:

•    Clarity and organization of the report (2% bonus points)

•    Proper formatting, grammar, and spelling (2% bonus points)

•    During the three-week trading period, the students' performance exceeds that of the S&P500 index (10% bonus points)

Note: The bonus points will be awarded based on the overall quality of the report, attention to detail, and adherence to the presentation format and guidelines.