PDF Stock Market Simulation - Worcester Polytechnic Institute

Project Number: DZT 1504

Stock Market Simulation

An Interactive Qualifying Project Report: submitted to the Faculty of WORCESTER POLYTECHNIC INSTITUTE in partial fulfillment of the requirements for the Degree of Bachelor of Science By

Travis Clark _____________________________ Jake Arnold _____________________________ Dylan Duprez _____________________________ Blaine Bursey _____________________________

Submitted: December 15, 2015

Approved by Professor Dalin Tang, Project Advisor

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Abstract

Using the tools and resources available from the internet, books and magazines, a seven week stock market simulation was made to investigate the effects of different trading strategies on investments. The knowledge gained throughout this project will be helpful for potential investors to become more skillful in their investments.

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Table of Contents

Abstract ............................................................................................................................... 2 Table of Figures .................................................................................................................. 7 Table of Tables ................................................................................................................. 11 Chapter 1 Introduction ...................................................................................................... 13

1.1 Brief History ........................................................................................................... 13 Chapter 2 Research ........................................................................................................... 16

2.1. Pivot Points ............................................................................................................ 16 2.2 Swing Trading......................................................................................................... 19 2.3 Trend Trading ......................................................................................................... 21 2.4 Position Trading...................................................................................................... 22 Chapter 3 Company Selections ......................................................................................... 26 3.1 Daily Pivot Points ................................................................................................... 26 3.2 Swing Trading......................................................................................................... 31 3.3 Trend Trading ......................................................................................................... 37 3.4 Position Trading...................................................................................................... 42 Chapter 4 Daily Pivot Point Simulation............................................................................ 48 4.1 Progression of Trading............................................................................................ 48

4.1.1 Week One......................................................................................................... 48 4.1.2 Week Two ........................................................................................................ 49

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4.1.3 Week Three ...................................................................................................... 53 4.1.4 Week Four........................................................................................................ 57 4.1.5 Week Five ........................................................................................................ 60 4.1.6 Week Six .......................................................................................................... 62 4.1.7 Week Seven ..................................................................................................... 65 4.2 Results..................................................................................................................... 69 Chapter 5 Swing Simulation ............................................................................................. 71 5.1 Progression of Trading............................................................................................ 71 5.1.1 Week One......................................................................................................... 71 5.1.2 Week Two ........................................................................................................ 72 5.1.3 Week Three ...................................................................................................... 74 5.1.4 Week Four........................................................................................................ 76 5.1.5 Week Five ........................................................................................................ 78 5.1.6 Week Six .......................................................................................................... 80 5.1.7 Week Seven ..................................................................................................... 82 5.2 Results..................................................................................................................... 85 Chapter 6 Trend Trading................................................................................................... 87 6.1 Progression of Trading............................................................................................ 87 6.1.1 Week One......................................................................................................... 87 6.1.2 Week Two ........................................................................................................ 87

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6.1.3 Week Three ...................................................................................................... 88 6.1.4 Week Four........................................................................................................ 89 6.1.5 Week Five ........................................................................................................ 91 6.1.6 Week Six .......................................................................................................... 92 6.1.7 Week Seven ..................................................................................................... 93 6.2 Results..................................................................................................................... 94 Chapter 7 Position Simulation .......................................................................................... 96 7.1 Progression of Trading............................................................................................ 96 7.1.1 Week One......................................................................................................... 96 7.1.2 Week Two ........................................................................................................ 97 7.1.3 Week Three ...................................................................................................... 97 7.1.4 Week Four........................................................................................................ 98 7.1.5 Week Five ........................................................................................................ 99 7.1.6 Week Six ........................................................................................................ 100 7.1.7 Week Seven ................................................................................................... 101 7.2 Results................................................................................................................... 102 Chapter 8 Comparison & Analysis ................................................................................. 104 8.1 Sector Profit Analysis ........................................................................................... 104 8.1.1 Daily Pivot Point Trading Results ................................................................. 104 8.1.2 Swing Trading Results ................................................................................... 107

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