What is stock market competition? Simply put, it's an organized event, with prizes awarded, that runs for a limited time (most often one month to three months). The purpose can be mixed (fundraising and educating participants in a risk-free environment) or strictly scholastic; the outcome proclaims the best investor from that competition. The competitions are generally established and sponsored by business organizations or institutions of higher learning, such as Hofstra University's school of business.
In 2009, for example, a San Francisco Bay Area online business, LinkedIn.com, began a stock market competition on November 16, due to end December 11. The competition was intended for (but not limited to) participants who are college students, investment bankers, stock brokers and other financial professionals. Each participant paid $10 to enter the competition and was asked to grow their portfolio to outperform the other contestants.
Participants could begin trading as soon as markets opened on November 16 and had to conclude all trades before the close of the trading day December 11. All were using a specific platform, Market Watch, to simulate the market. Participants could trade in and out of positions (as opposed to holding a position for the entire month), day-trade, and engage in short selling.
Sometimes groups of students are assigned to a specific stock market competition in which they'll be competing against other groups from their school as well as those from other schools. In the case of St. Joseph's University Haub School of Business, their most recent stock market competition, platformed on Market Watch's Virtual Stock Exchange, lasted from September 1 through the end of November. It was set up to give "participants an opportunity to learn about investing in a fun, risk-free way" and was limited to St. Joseph's students. Each began with $200,000 cash equity and could leverage it 2 : 1. Transactions costs were $8 each and the minimum price per share was $5.
Stock market competitions seem like an ideal exercise for groups of individuals interested in the stock market, but perhaps somewhat limited in funds. A neighborhood association might be formed to play; those who did well might be financially sponsored by the rest to try a little actual investing for the group as a whole.