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Undergraduate Rocks Barron’s Contest, Stands out on ‘Fast money’
When Barron’s Challenge, an
annual stock-picking contest,
came to a close on March
30, 2007, about five months
after it began, the secondand
third-place finishers
in the student division had
made returns of 34.95% and
34.94%, respectively. While
such gains were certainly impressive, Felix Wang, W’08,
made a whopping 114% return,
more than doubling his
hypothetical starting capital
of $100,000.
So what is his secret?
How does a college student
who has never owned
real stock, much less held
$100,000 in capital, beat
out 1,847 other entrants by
a landslide?
In fact there are few secrets
to his strategy — only
good research and sound investment
principles.
He looked at whether securities
were undervalued or
overvalued, and bought and
shorted accordingly. This
informed his decision to
buy shares of CDC Corp.,
which is traded as CHINA
on NASDAQ.
Although CDC Corp.
began as an online media
portal called China.com, it
has expanded to include a
number of different companies,
including those
focused on enterprise software,
business services, mobile
applications, and online
media. “I was intrigued by
the potential growth prospects
by that company,”
Wang said, “and they were
in a really good area — they
were the first to enter this
kind of business.”
Coincidentally, CDC
Corp. CEO Peter Yip, WG’76, is a Wharton
alumnus, having received
his MBA in 1976. He
and Chairman Raymond
Ch’ien, Gr’78, who received
his PhD in economics from
Penn in 1978, visited Wang
in February, after learning
that he had invested in their
company, and that he was a
student at Wharton.
“We had a good time.
We talked about his business
and about Penn in general,”
Wang said. “I actually
kept in touch with them after
the visit and they were
happy to hear that I won
the competition.”
While Wang bought
many mock shares of CDC
Corp., he was careful to heed
the advice of his Wharton
professors, who stressed the
importance of diversification.
He minimized risk by having
over 30 securities in his portfolio
and by shorting stocks.
More recently, Wang was
featured on CNBC’s “Fast
Money,” alongside MBA students
from Harvard, Yale,
and Columbia. At 20, and
the only undergraduate student
on the panel, Wang was
the youngest representative
by a wide margin. Yet he answered
his question — on the
digital revolution — in a way
that impressed “Fast Money”
anchor Dylan Ratigan.
“Felix rocks,” Ratigan
said. “Not even adjusting
for age which is impressive.
You got an A and a
smiling face.”
With his knowledge
of the market, one would
think that Wang would be
eager to open his own portfolio.
But with other interests,
such as music, Wang
doesn’t mind putting that
on hold for awhile.
“I definitely think I have
something going for me but
I think I’ll wait a year or so,
when I have time,” Wang said.
—James Yu
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