| Trading dates for the $1,000,000 Challenge are October 09, 2006 to April 13, 2007. The initial cash balance is $1,000,000. |
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| Before making any trades, you must have your team number, password, and the ticker symbols of the securities you wish to trade. |
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| There are two ways to make a trade: |
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| A. Your state SMS home page |
| Visit the home page to submit trades, review your team's activity, research stocks, obtain quotes, find ticker symbols, and review your team's ranking. This is the best way to trade because it is fast, accurate, and convenient. |
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| B. Fax Line Toll-Free: 1-888-275-0969 |
| Your teacher may fax in your trades 24 hours a day. You must send your trade request in on the fax form provided to your teacher. The form may be found as a link on the left navigation bar. The fax form can be viewed and printed using Adobe Acrobat Reader. All information must be filled in completely with dark ink for your trade to be processed. This includes your team number, password, your advisor's name, signature, and phone number, fax number and all information pertaining to your trades. |
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| Trading Stocks: There are four basic ways to trade stocks: buy, sell, short sell, and short cover. When buying a stock, you are taking a "long position" with the hope that the price per share will increase. When you sell a stock, you close that long position. Selling short is selling a stock that you don't own (you actually borrow the stock from the broker) with the hope that you can later buy the stock back at a lower price. When you buy the stock to pay back what you borrowed, it is called "covering" your short position. To buy or short sell a stock, specify how many shares you want, rather than how much money you wish to spend. You may not be long and short in the same stock at the same time. |
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| Trading Funds: You may buy or sell mutual funds with the SMS. Mutual funds are traded in dollar amounts not by number of shares. Mutual funds must be traded in lots of $500. Like stocks, in order to trade mutual funds you must have the ticker symbol. All mutual fund ticker symbols are five letters long ending in "X". |
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| Stocks: Trades made via the web page will receive 15-20 minute delayed prices if placed while the market is open (generally 9:30 a.m. to 4:00 p.m. ET). Trades placed after the markets are closed will receive the next day's open price. Trades made via fax and received by market close will be executed at that day's closing price. Fax trades received after the market close will receive the next day's closing price. |
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| Mutual Funds: Mutual funds are always traded at the end of day price (NAV or net asset value). Trades received before market close will be placed at the closing price for that day. Trades made after market close will receive the next day's closing price. |
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| All stock splits and all dividend payments over $0.10 will be credited to your portfolio. Splits that have been credited to your portfolio have the appearance of a buy or short sell, but the price per share is $0.00. Dividends will appear in your portfolio with a "-DIV" attached to the ticker symbol to alert you to a dividend payment. |
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| Stocks: You may buy, sell, sell short, and cover a short almost all NYSE and NASDAQ-AMEX stocks (common and preferred) that are trading at $5.00 or more. IPOs are usually available the afternoon that the new stock starts trading on the exchanges. Stock trades may be in any whole number of shares greater than 25 (i.e., 25 share minimum but you can trade 26 shares or more). |
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| Mutual Funds: All publicly traded mutual funds may be traded. |
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- Teams may not buy or short sell stocks trading for under $5 per share. Teams may hold onto stocks that have dropped below $5.
- The maximum number of shares a team may trade is limited to the actual volume on the stock that day.
- All mutual fund transactions, with the exception of liquidation, must be made in increments of $500.
- To encourage diversification, there is a maximum position limit of $250,000 in any stock.
- You may not hold a short and long position in the same stock at the same time.
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| You need to know the ticker symbol for the security before you can trade it. Please note that most local newspapers show only the abbreviation of the company name, not the ticker symbol. The Wall Street Journal and the web page are two really good sources to help you find the ticker symbols you need. |
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| A broker's commission is applied to most transactions. The commission for stock trades is a flat fee of $25 on each transaction regardless of the number of shares. If you sell one stock and buy another you will be charged two commission fees. The commission charged for all mutual funds is 1% of the purchase price. A commission is not charged when selling mutual funds. |
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| The margin requirement for the simulation is 50%. Initially, this means that since you are starting with $1,000,000, you may borrow another $1,000,000, making your total buying power $2,000,000. You may buy and short sell stocks on margin. |
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| Interest will be earned on all available cash balances and credited at the close of each day. During the simulation, cash balances will earn 3% interest, compounded daily. |
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| Interest will be charged on all loan balances and will be debited at the close of each day. During the simulation, loan balances will charged 8% interest. |
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| Hard copy statements will not be printed and sent out for the $1,000,000 Challenge. Statements can be printed from the web page at anytime. |
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| Each team is limited to 50 transactions during the trading period. Each buy, sell, short sell or short cover counts as a transaction. For example, if you buy a stock and sell another stock you will be charged with 2 transactions. |
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| Teams wishing to be eligible to be declared winners must make at least one trade by the end of trading on Friday, December 2, 2005. Teams must also follow all of the official rules. |
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| You do not need to convert all of your investments to cash on the last day of the simulation. Your portfolio will be valued at the closing prices for that day. The National SMS will announce the official winners of the simulation, usually within two weeks after the last day of trading. |
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- If you and your teacher believe an error has been made in your portfolio, your teacher may call 1.866.SMS.DESK to discuss the problem. Please review your statements and report any problems immediately.
- The management of Stock-Trak, Inc. and its partners are not responsible for trades or quotes that are incorrect or not received.
- The management of Stock-Trak, Inc. and its partners may use various methods (such as time and tape analysis) to resolve disputes.
- The decision made by the management of Stock-Trak, Inc. and its partners is final.
- The management of Stock-Trak, Inc. and its partners have the right to adjust or delete trades that are believed to be incorrect, and the right to terminate any account that they believe may have attempted to exploit, manipulate, or sabotage any part of the SMS trading system and/or web page.
- The management of Stock-Trak, Inc. and its partners have the ultimate authority to settle disputes.
- The management of Stock-Trak, Inc. and its partners' liability is limited to the fee paid for the service.
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