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October 6, 2003

UW Business School opens West Coast’s first Nasdaq student trading room

The market’s looking bullish in Balmer Hall thanks to the University of Washington Business School’s new Nasdaq trading room.

Robert Greifeld, president and chief executive officer of the Nasdaq Stock Market will be at the UW on Tuesday to officially open the only trading room in the western United States on a college campus.

The UW Business School will provide a high-tech trading environment to master’s of business administration students, enabling them to make simulated trades using real-time information and thus experience firsthand what makes a winner or loser on the Street.

There are roughly a dozen colleges in the United States with mock trading rooms. Although the terminals won’t allow students to complete transactions, the trading room lets students use real-time data to manage their portfolios.

“Our trading room is akin to a chemistry or physics lab with respect to the real-world experimenting students will perform and learn from — this kind of practical, truly hands-on experience is one found on Wall Street, not in workbooks,” said Vance Roley, UW professor of finance and associate dean for academic and faculty affairs in the business school. “This will significantly expand the finance department’s core curriculum by integrating actual markets into the courses and by introducing new tools for analyzing market behavior and financial strategies for managing investment portfolios and risk.”

Nasdaq, the world’s largest electronic stock market, lists more companies and, on average, trades more shares per day than any other U.S. market. The UW Nasdaq trading room replicates real-world trading environments and will function as a classroom and a laboratory facility. Students will be able to research securities and have access to all the data Wall Street professionals have, including live news coverage of financial markets from CNBC and CNNfn.

Students will practice financial risk management in the trading room facility located on the fourth floor of Balmer Hall. The room features a display board running stock quotes and other data on a continuous feed, as well as 12 trading stations and two television monitors. Each station is equipped as a trading desk would be in a Wall Street firm — complete with dual computer screens, one of which provides financial market data from the Reuters news agency.

“The technology behind the Nasdaq room gives students the feel of a real-time Nasdaq trading environment,” said Greifeld. “With the second-highest concentration of Nasdaq companies in the world located in the Pacific Northwest, it only makes sense for our future business leaders to profit from the technologically advanced curriculum offered at the University of Washington.”

The center includes a ticker showing stock prices and a wallboard displaying data from Nasdaq, Dow Jones & Co., and other sources including interest rates and currency and bond prices.

“Learning how to be a good trader takes practice, and now our students will learn which strategies work best while they assume the role of a market maker in a dealer market, buying and selling securities to make a trading profit,” said Jefferson Duarte, a UW assistant professor of finance and former Wall Street bond trader. “The trading room will certainly add a realistic dimension to the classes we teach about risk management and futures and options.”

Not since the early 1930s when the Northwest Commodities and Stock Exchange operated downtown has Seattle had a stock exchange.

The UW’s student trading room is partially funded by a $250,000 grant from the Nasdaq Stock Market Educational Foundation.

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For more information, contact Roley at (206) 685-3622 or vroley@u.washington.edu; or Duarte at (206) 543-1843 or jduarte@u.washington.edu.