Bourstad stock market simulation competition | $200,000 to invest in an unpredictable market

It can be intimidating to enter this year’s Bourstad Portfolio Management Competition, given that it begins just weeks after Donald Trump’s inauguration as President of the United States. But we must remember that uncertainty and the world of finance often go hand in hand.

Moreover, in 1987, the first edition of the Bourstad Competition was not held in a particularly stable period, recalls the founder and director of the project, Paul Bourget. “The first day was Black Monday. It was a day when the Dow Jones lost 22%,” he emphasizes.

“We have seen other periods of uncertainty over the years! », says the man who is project director at the Interuniversity Research Center in Organizational Analysis (CIRANO), and who has a long career teaching finance.

Nevertheless, during a presentation which marked the start of the competition registration period last Wednesday, we felt that the events of the coming weeks were particularly difficult to anticipate.

“You have to be humble in all of this. We published our last forecasts in December, but I prepared everyone at the bank by emphasizing that next week, significant changes could be coming,” indicated Matthieu Arseneau, deputy chief economist at the National Bank.

His advice for participants? “We favor caution, these are our first recommendations,” said the analyst, referring in particular to an underweighting in equities.

Paul Bourget goes in the same direction. “I think a cautious posture, as Matthieu Arseneau recommends, is probably the thing to consider,” he says.

A fictitious portfolio

It is the participants who will decide what they will do with the fictitious portfolio of $200,000 that they will have to administer over a period of two months, from February 10 to April 11, 2025. They will be able to invest in a selection of more than 700 real securities listed on stock markets.

Their performance will be analyzed according to criteria linked to portfolio management, overall performance and responsible investment. Several prizes of up to $1,000 will be distributed, for a total amount of $40,000.

Nearly 80,000 people have participated in the Bourstad Competition since its launch. The majority are high school and college students, but it is also open to university students and the general public.

Last year, Olivier Lesage-Filippin, then a student at Drummondville CEGEP, won a mention of excellence in portfolio management in the competition.

“I applied what I knew, and invested as I would in real life. I think the judges noticed that the level of risk that I had identified for the management of this portfolio was almost modeled on that of my transactions, and that is how I won,” says the one who became interested in personal finance by reading books on the subject.

This year, he wants to test other skills in the competition by taking more risks.

The 19-year-old believes it is beneficial for social science students to take an interest in these issues. “Beyond financial literacy, it’s good practice for the analytical assets that you can develop in the field of human sciences,” says Olivier Lesage-Filippin.

Some new features

Some new features are on the competition program this year: 41 new titles have been added to the selection from which participants can build their portfolio.

The rules have also been tightened to prevent participants from giving too much weight to the overall performance of the portfolio compared to other criteria. Participants will now have to make a transaction on at least five securities. “It’s a rule that we will strengthen over the years. This year we are introducing it slowly,” says Paul Bourget.

“The spirit in which we do Bourstad is to encourage people to make wallets that could hold up after the end of the competition. »

Webinars will be offered to participants throughout the experience. The winners will be revealed in May.