The 8-week competition was run and sponsored by Horizons Exchange Traded Funds Inc. and hosted on Stockhouse.com.
Horizons Exchange Traded Funds Inc. (TSX:T.HAA, Stock Forum) said James Buchan has walked away with a $5,000 grand prize after the Ottawa resident won Horizons ETFs Biggest Winner Competition, generating a 31.90% return over a two-month period.
He collected the prize at a TMX opening bell ceremony on Thursday morning.
In the competition, Buchan’s strategy was using both inverse and leveraged Exchange Traded Funds (ETFs).
“I started by taking a leveraged long position in natural gas by purchasing HNU,” Buchan said in an interview with Horizons. “When it went up quite a bit, I sold it and moved into the inverse version, HND. That ETF went up, and I sold it and moved back into HNU again.”
Along with that strategy his big trade in the completion was HVU, a leveraged volatility ETF.
“I knew with all the negative developments happening in the market, especially with the mess in Spain, I thought the [stock] futures were overvalued and volatility would increase,” Buchan said. “I thought things would come down significantly, which they did, and that worked out really well for my trade on HVU.”
In the real world the self-employed James Buchan started investing when he was only 17.
“I started off investing in companies, especially in mining, oil and gas,” said Buchan about his investments. “I like the really junior stuff.”
He still trades stocks, but Buchan said one of the reasons he like ETFs is “because you only have to get the sector call correct to do well.”
The 8-week competition was run and sponsored by Horizons Exchange Traded Funds Inc. and hosted on Stockhouse.com.
“The reason we launched this competition is really to generate interest around ETF investing and in particular generate interest around using some of the ETFs that aren’t your standard ETF fare,” said Mark Noble, Vice President of communications and public relations at Horizons. “It seems to have worked remarkably well.”
Investors had the option to buy and sell any of the 86 ETFs offered by Horizons ETFs throughout any trading day. Each participant's virtual trading account was funded with $100,000 CAD of fantasy dollars for them to trade the ETFs.
“All of our ETFs were listed in real time to be able to be traded by the ETF investors,” Noble said.
Roughly 1,400 competitors participated with 53% beating the returns of the Canadian Stock, “which is pretty phenomenal achievement if you think about how difficult it is to beat the market, particularly in a down market,” Noble said.
Horizons exchange traded funds come in 86 fund options for both bull and bear markets. They offer a broad range of ETFs exposed to a wide variety of assets and markets, including the largest suite of leveraged, inverse, and actively managed ETFs in Canada.
On Thursday the T.HAA was selling for $10.20. The Horizons Balanced ETF has a market cap of $10.2 million based on $1 million shares outstanding. The 52-week high and low was $10.93 and $10.00 respectively.
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