Junior's stock pick scores high
By KATIE NAGENGAST
News Writer
Never underestimate the luck of the Irish.
John Lavan, a junior finance major, emerged victorious from the Wall Street Journal's latest stock picking contest after choosing his stock randomly from the Nasdaq Stock Market tables.
His technique for choosing the successful stock was simply to run his finger down the table until he got to the letter "E." Lavan's luck then led him to Elbit Ltd., an Israeli maker of electronic and imaging systems that rose more than 110 percent during the contest, which ran from May to October 29.
"I didn't really research [Elbit]," Lavan said. "I had never heard of it and I have never heard of it since in the news or anything."
Originally Lavan was up against more than 800 other Wall Street Journal readers who entered the contest via e-mail just as he had. However, in April, Lavan's entry was one of four drawn at random to represent the amateur Reader's Portfolio. The contest also charted the results of four professional investors' choices as the Professional Portfolio, and chose four Nasdaq stocks randomly to represent the Dartboard Portfolio.
"It was weird because I didn't even realize I had been picked as a finalist until about six weeks after the contest had started. My aunt sent me a copy of the original article I was in," Lavan said. Realizing he had been named as a finalist prompted Lavan to check the progress of his random selection.
"[Elbit] was up like 100 percent and I had no idea," confessed Lavan. "Luckily it just hovered there for the next few months."
Lavan's hovering stock lead the Reader's Portfolio to a 24 percent average gain, trouncing the 1.5 percent gain charted by the Professional Portfolio. The Dartboard Portfolio's earnings also beat the Professional Portfolio with 1.8 percent profit, again showing the random nature of the stock market, according to analysts.
"If I was a professional investor, I would never enter one of these [contests], because you can't win. And you're supposed to, but I wouldn't be too happy to have a lucky college kid beat me," said Lavan.
In fact, Lavan hopes to one day join the ranks of the professional investors, despite their recent random defeat. "I was just reading the Wall Street Journal before class one day [last spring] and I thought it would be fun [to enter this contest]," Lavan said. "I never thought I would win, I just sent it in to see what would happen."
"I did it because I'm interested in investments. That's what I'm thinking about doing for a career. I did an internship last summer, but it was with more of an accounting firm. This summer I'm looking for investment banking, or an investment firm, so this should help," Lavan continued.
Unfortunately for Lavan, his stock earnings were merely hypothetical because entering the contest did not actually require purchasing stock he chose. In addition, Lavan did not receive any prizes for his victory beyond bragging rights and some positive press.
"It's still pretty exciting. People my relatives work with mention it to them. Plus, the Wall Street Journal called my professors, though most of them read it anyway. Some of them even cut out the article and handed it to me, and I talked to them about it," said Lavan.
Despite his newfound fame, Lavan is reluctant to offer any words of wisdom.
"There's not much I can say, I didn't really do anything," he explained. "Everyone is expecting me to have some investment philosophy, but I'm just lucky, I guess."
All News Stories for Tuesday, November 16, 1999
