CNBC Portfolio Challenge finds Cheating

June 12, 2007

CNBC CheatersIt is amazing that no matter what, there are those that will find a way to cheat the system. In an apparent technology flaw, players could actually trade after the market closed, profiting on earnings and other news releases. The ability to do so was recently uncovered as a few players became vocal when they noticed that several of the daily winners had been 100% accurate on all of their trades.
I am physically sick about this. First from the fact that there were many unknown contestants that may have been involved and second because of the hard work that I personally put in and the realization that the challenge is so incredibly filled with fraud. The biggest problem?:

The entire 10 weeks should be scrapped as the entire process is now tainted.

CNBC may need to rethink the entire idea of this and retroactively cancel the entire game. There should not be a winner of this as no one can ever be clear where the cheating stopped and started. All involved with the design and management of this should be ashamed! (Not to mention that it was always a shameless act of promotion by CNBC)

CNBC Investigates Contest for Cheating
Listen to this story...
Morning Edition, May 31, 2007 · The financial news network CNBC announced it is investigating illicit trading in its own contest, called the “CNBC Million Dollar Portfolio Challenge.” The CNBC contest had 375,000 entrants, or so-called aspiring moguls. They each got a fictional trading account and $1 million CNBC bucks. It seems some of them were tempted to cheat — even with fake money. The grand prize: $1 million. http://www.msnbc.msn.com/id/19121769/

According to NPR: The financial news Web site TheStreet.com says it’s canceling the first round of its “Beat the Street” competition because of fraud. This comes a month after the financial news network CNBC announced it was investigating trading scams in its own contest, Million Dollar Portfolio Challenge. Contestants are speaking out about what went wrong.

Tags: , , , ,

Related posts

Written by Andrew Horowitz · Filed Under Markets 

Comments

4 Responses to “CNBC Portfolio Challenge finds Cheating”

  1. Brett on June 12th, 2007 3:56 pm

    When you put up big money like that you are bound to get someone trying to cheat the system. Fantasy games, for the most part, are a waste of time. But to totally contradict myself, I will occasionally go to hedgestop.com to see what the college kids are trading. Best luck

  2. Zachary Scheidt on June 12th, 2007 4:34 pm

    I’ve always had a hard time with these games (and yes i competed and didn’t do well against the cheaters). Not only do you face people abusing the system, but the entire process doesn’t reflect reality. Think about it, there is no penalty for losing all your capital. There is a potential for a nice prize if you win… So the obvious way to play is to take as much risk as possible and HOPE you pick a stock that doubles, tripples and then some…

    I would propose that someone set up a system that rewards the best Sharpe ratio during the time measured. That way all contestants have an incentive to create portfolios that have lower risk and the winner might actually represent someone who could create alpha as an investor.

  3. william holloway on June 11th, 2008 2:23 am

    I agree the game should be scrapped. no one should be rewarded the prize until an investigation is done. I can’t understand how the market went down 100plus pts one day then 300 another day. and theses people only lose a few thousand dollars. either you are lucky or you’re cheating.no one is that good week after week. if you are caught trading after hours you should be disqualify. I reinterate that cnbc investigate before you give the award out. It’s too much to give to someone who is cheating.

    PH

  4. Hovinyriniomb on September 2nd, 2008 5:11 pm

    wow :)
    its very interesting point of view.
    Good post.
    realy gj

    thx :-)

Got something to say?