Early Standings in FinTech Trading Competition: Slow and Steady Strategies and an Upset

February 21, 2022 | Jake Vestal

Early standings in the FinTech Trading Competition saw the emergence of two frontrunners running similar strategies, followed by a surprising upset.

Early standings in the FinTech Trading Competition showed the emergence of two frontrunners from opposite sides of the country, implementing strikingly similar (and effective) strategies.  Seemingly untouchable by their peers, the traders, named Hoppity and Bubbles, reigned in first and second second place for nearly three weeks by running strategies that generate small but reliable daily returns with almost zero volatility. 

That was, until Bubbles' strategy took a downward turn on February 17, placing him in 3rd place.  Bubbles now has a Sharpe ratio of of just 0.44, putting him just behind Trader Raven, who now occupies 2nd place with a Sharpe radtio of 0.56.

Hoppity remains in the lead with a commanding Sharpe of ratio of 16.78. 

Graph of Top Sharpe Ratios Over Time.  For more data visualizations and to see the full list of rankings, visit the Scoreboard.

Bubbles, Hoppity and Trader Raven were asked to provide a few words about themselves and their strategies. Trader Raven could not be reached for comment.

Bubbles had this to say:

 My name is Tanner Hoke and I am a Computer Science major at Texas A&M University. I noticed that the trading competition is scored based on Sharpe ratio, and thought that if I could find a strategy to make the denominator (which is EoD volatility) close to zero, I might have a shot at winning. I won’t go into too much detail about my strategy, but it involves a high probability of generating a consistent and small positive return every day. It’s possible that it fails somewhat catastrophically, though; we will see!

Hoppity provided the following:

I am Richard, a senior at Harvard University studying Math and Statistics. I had some previous experience with quantitative trading, and will be working at a proprietary trading firm next year. I’m super excited for the competition since the scoring function is more interesting than traditional trading competitions!

Since the goal of the competition is to maximize the Sharpe ratio, it is crucial to reduce my risk and variance as much as possible. I am running an automated trading strategy that aims to make a constant and positive returns every day. The automated strategy allows me to avoid most market risks that are unavoidable with “buy and hold” strategies, thus maximizing my Sharpe. I hope to keep this up for the rest of the competition. Computer code is prone to errors, and it seems like another competitor is right on my tail!

Will Bubbles recover and overtake the frontrunners for first place? Will Hoppity’s strategy continue as expected and keep him in the lead? Will Trader Raven continue to rake in cash while maintaining a very respectable Sharpe?

Keep watching the scoreboard at www.fintechtradingcompetition.com to see the competition play out! This site is updated daily.