Sales & Trading Simulation

MACRO RESEARCH
INVESTMENT BANK SALES TRADER: SELL-SIDE OBJECTIVES

● Client Relationships: Communicate regularly with your clients in order to

form and maintain strong relationships.

● Maximise Commission: Facilitate as many client trades as you can.

● Competitive Prices: Provide tight bid/offer spreads for clients when they
ask for quotes. Bad/wide spreads will mean clients will be unlikely to trade
with you.

● Manage Risk: When a client accepts a trade with you, the bank will
automatically be put into the opposite position. Trade out of these
positions of risk by using cross-trades with other investment banks, or by
using the exchange..

● Profit and Loss: Profit is risk for an Investment Bank. Ensure that your PnL
does not exceed your final amount of commission.

● Manage Market Impact: When trading out of risk positions on the

exchange, break positions up into smaller execution sizes to avoid PnL
losses through market impact.

HEDGE FUND: BUY-SIDE OBJECTIVES

● Investment Strategy: Multi Asset, $20 million capital. Use both long and
short strategies. All assets are priced in US dollars.

● Investment Time Horizon: 45 minutes simulation time will be equivalent

to investing through a fictitious 3-month time period.

● Investment Objective: To generate as high a return on investment as

possible.

● Execution: Avoid large market impact on the exchange. Achieve more

competitive prices by trading through the investment banks.
MACRO OVERVIEW
The US economy finds itself in a strong recovery, following a deep recession the year before. Consumer
spending is on the rebound, monetary policy is still very loose however, and the Federal Reserve is
expected to start tapering its asset purchasing programme.

Tapering refers to the gradual slowing of the pace at which the Fed purchases large scale assets. This is
essentially a slowing of quantitative easing, as the Fed has been injecting money into the economy to
recover from the economic downturn caused by the COVID - 19 pandemic.

Market participants & Central Bankers around the world have been debating whether or not inflation
will be transitory or persistent. Whilst inflation has been steadily creeping upwards, having reached 5.4%
this month, central bankers have taken the ‘transitory’ side. Market participants have pointed out that
due to the current supply chain crisis and increasing consumer demand, inflation may be more
persistent and are expecting interest rate hikes in the following year.

Interest rate hikes are intended to bring inflation down to the target level of 2%. If interest rates rise,
banks would borrow at a much higher cost, which in turn leads to them increasing their interest rates
for consumers. Ultimately, the goal is to reduce consumer spending as it becomes more expensive to
borrow money. Inflation, tapering & interest rates will be the main theme of macroeconomic news in the
coming year.

1. EQUITIES

NASDAQ Composite Index (NASDAQ)

The NASDAQ has performed strongly in the past year. NASDAQ constituents are expected to benefit from
long-term trends such as the growth of e-commerce and artificial intelligence.

The greatest concern for investors looking at the NASDAQ would be a potential rise in interest rates, which would
cause technology valuations to suffer. Additionally, the NASDAQ’s relatively high valuation makes it vulnerable to a
sell-off.
Oracle (ORCL)

Oracle’s share price has climbed sharply over the last year—up roughly 60% in the chart. Strong demand for Oracle
Cloud Infrastructure, steady growth in database subscriptions (including Autonomous Database), and momentum
in Fusion cloud apps and healthcare data offerings have all underpinned the move. Partnerships around
generative AI and multicloud deployments have also expanded Oracle’s addressable market and lifted investor
confidence.

Despite bouts of market volatility, the stock’s trajectory has remained decisively upward, reflecting Oracle’s solid
execution in cloud, improving margins at scale, and an ability to adapt its products to shifting enterprise needs.

Rivian (RIVN)

Rivian, a fast-growing electric-vehicle maker, saw its share price whipsaw this year: an early rally gave way to a
steep sell-off, and the stock now sits roughly 30–40% below its starting level on the chart. While brand interest and
order backlogs remain, a tougher macro backdrop, slower EV demand in pockets of the market, and ongoing
production and supply-chain constraints weighed on sentiment especially as costs to ramp new models and build
out charging/service networks stayed elevated.

Competition has intensified as legacy automakers and pure-play EV rivals push aggressively into Rivian’s core
truck/SUV segments. Investors have also focused on cash burn, the timing of margin improvement, and the pace
of factory throughput. Near term, watch updates on quarterly deliveries, gross-margin progress, component
availability (batteries, power electronics), and fleet contract timing, key catalysts that could steady or further
pressure the shares.
 Toyota (TYT)

Toyota, the Japanese automaker, has trended higher over the past year, with the stock up roughly 35% on the
chart. A renewed push in electrification spanning hybrids, plug-ins, and the next bZ all-electric models along with
improved production and cost controls helped lift sentiment and volumes.

Momentum accelerated mid-year as investors reacted to roadmap updates and capacity additions; pullbacks were
brief and met with higher lows, keeping shares near the top of the year’s range. While there were a few sharp
swings, Toyota has held on to most of its gains.

Looking ahead, buzz around Toyota’s upcoming all-electric SUV slated for early next year, plus steady demand for
hybrids, has analysts penciling in a measured continuation of the uptrend. The company’s diversified approach to
electrification and disciplined execution are seen as key supports for the shares.

Chevron (CVX)

Chevron Corporation is a U.S.-based integrated energy company. Like most oil majors, Chevron’s share price tends
to track crude prices and refining margins. On the chart, the stock is up roughly 50–55% over the period, with a
strong early climb, a mid-year plateau, a pullback, and then a rally to fresh highs.

The upside has been supported by tighter global supply (including OPEC+ production cuts), resilient product
demand, and healthy refining/chemicals spreads, alongside Chevron’s capital discipline, buybacks, and dividend
strength. While volatility remains—driven by macro growth worries, inventory swings, and geopolitics—investors
are watching upcoming OPEC+ decisions and U.S. production trends as key catalysts for the next leg of the move.
2. COMMODITIES

Gold Futures (GOLD)

Investors have turned to gold as a safe haven investment, hoping to protect themselves from market volatility and
uncertainty. Due to this, During the latter half of 2020, gold reached all time highs surpassing $2000 per ounce.

However as the global economy has begun to stabilise and and the progress in COVID-19 vaccinations lessened
the reasons that had initially boosted gold's rapid rise.

Although gold had come down from its highest point, it still played a crucial role in diverse investment portfolios,
acting as a way to protect against rising prices and as a safe choice in uncertain times.