MSCF Students Simulate Market Trading in Annual Market Making Game

On August 26, 2016 New York City and Pittsburgh welcomed a new stock market to town. 

More than 50 first-year students from Carnegie Mellon’s Masters of Science in Computational Finance (MSCF) program created a “mock” stock market and played the role of market traders in the annual Market Making Game. 

What started as a student-led initiative by second-year MSCF students has turned into one of the program’s unique differentiators – a real-world, simulated trading environment that provides students a sneak-peak into the financial industry. 

“Not all students have a strong background in finance when they first come to campus,” said Kasiviswanathan (Kasi) Muthaiah, MSCF ’16 and organizer of the event in Pittsburgh. “The Market Making Game provides a great introduction to how financial terms fit into the operations of market making.”  

First year MSCF students are immersed in the competition – guessing stock prices, adjusting predictions and trading stocks – to get the closet to target numbers and win the competition. 

“The game is structured to introduce concepts and simulate the buy and sell side of the market,” said Calvin Zhu, MSCF ’16 and organizer of the event in New York City. “It’s meant to be a fun and informative approach to learning this side of the industry.”

The Market Making Game strategically takes place during orientation week to prepare students for the Deutsche MSCF Trading Competition that occurs later in the fall. 

During this competition, all first-year full and part-time students use equity and fixed income derivatives securities on a paper-trading platform through Interactive brokers. The top three winners are awarded cash prizes and honored by all participants and the MSCF Steering Committee members at a reception hosted by Deutsche Bank in New York City.

“The Market Making Game and Deutsche MSCF Trading Competition are invaluable exercises that provide industry insight and unique perspectives that will be useful throughout our careers,” said Muthaiah.