Canadian Derivatives Exchange*

Options Trading Simulation

Registration and general information

Free registration

Complete the registration form.

Registration deadline

Friday, September 19, 2014, at 5:00 p.m. (EDT).

Eligibility conditions

Each team must be enrolled in a full-time undergraduate program, specializing in finance (or any other related discipline), in Canada.

Team composition

Teams must be composed of one to four participants. There is no limit to the number of teams by university or faculty.

Simulation description

Initial parameters

  • Each team is given a virtual cash account of $100,000 to build its options portfolio.
  • This eight-week Options Trading Simulation is held during the 2014 fall term, from September 24, 2014 to November 21, 2014.
  • Each team is strongly encouraged to attend a classroom presentation hosted by their university's student ambassador on September 24, 2014, at 5:00 p.m. (EDT). This education session will focus on the mandatory components of the simulation, the options trading strategies, and the trading simulator functionalities. This presentation will be followed by a live question period through webcast.

Mandatory components

  • To construct their options portfolio, teams must choose at least five Canadian options classes from the 30 most active securities.
  • Each mandatory strategy must have a minimum notional value of $5,000 or 10 options contracts. There is no minimum holding period required.
  • Mandatory strategies must be traded in a single transaction by selecting the "Transaction Type" field of the Trading Simulator, and not by legs. The mandatory strategies will not be recognized if this requirement is not fulfilled.
  • All positions must be liquidated before market close on November 21, 2014. This is also the November expiration date for option classes. Each team with open positions after the last trading day will be disqualified.

Mandatory strategies

  • Each team must execute the following four predefined options trading strategies:
    • Long put
    • Bear call spread
    • Bull put spread
    • Collar
  • Each team must execute a surprise strategy that will be unveiled by email on the 2nd trading week. The email will include a link to access the video explaining the strategy starting on October 9, 2014, at 4:00 p.m. (EDT). A question period through live chat on Facebook is planned on October 10, 2014, from noon to 1:00 p.m. (EDT).

Winners

Three winning teams, having achieved the best returns after eight weeks of trading, while fulfilling the mandatory components, will be awarded a 1st prize of $10,000, a 2nd prize of $5,000 and a 3rd prize of $2,500 respectively from the Montréal Exchange.

The best performing team per university as well as the top 50 teams, having fulfilled the mandatory components, will receive a certificate of participation.

Equity option strategy sheets

Guides and strategies offered by the Montréal Exchange are available on the website for your reference.