Rich returns for Ruff Riders

By IRENE CHAPPLE

Money, money, we need more money. Someone produces two crumpled $5 bills. Good enough? There is a $10 and a $20 offered. No, no, we need serious cash.

Rosmini College headmaster Tom Gerrard pokes his head around the door and is asked to contribute.

"We're not King's [College]", he hoots.

Accounting and maths teacher Lawrence Toh is determined. He darts out the door and returns triumphant.

"Found a rich person!" he cries in delight, clutching a handful of $50 bills.

Three teenagers - Alex Brown, John Casey and Robert Colhoun - get artistic.

A fiver goes into the pocket of one, a $20 pokes from the jacket of another. Ruff Riders Finance rides rich again. They strike a pose and the photo is shot.

They've been rich before, this lot.

They made a $27,164.99 profit on the New Zealand stock exchange between March and August from an original investment of $50,000.

True, it was just paper money used in a computer game but it was well up on the combined value of listed companies which rose 16.53 per cent over that period.

The Ruff Riders - a title chosen "to give a tough name to actually just sitting in front of a computer" - this month won the Schools Stockmarket Challenge, run by the NZX.

The trio faced their share of difficulties: A rival school jumped suspiciously to first place before being quietly dropped from the race.

Was it a corporate-governance scandal or insider trading? The NZX will say only that the school was disqualified for breaching the rules.

Then there was the blip when an NZX ticker-code glitch artificially - and temporarily - boosted players with New Zealand Experience shares, and Ruff Riders dropped more than 100 places.

The team would occasionally concoct their business strategies over a "couple of quiets" at the weekend and reckon they almost came to blows over one decision.

What company caused so much stress? Er, they can't remember.

But beyond the investing irritations the three stayed true to their vision and their success won them a $2000 share portfolio.

The Herald visited the Ruff Riders' North Shore headquarters to discover how three schoolboys managed to leave New Zealand's real investors coughing in the dust.

It should be said the challengers had some advantages over real investors.

They could trade outside market hours, trading halts were not reflected in the game and shares could be sold even if they were not liquid on the real market.

March was also a good time for investors to buy into the sharemarket.

Internationally, markets were low as the Iraq war exploded and investors got jittery.

In New Zealand, Tranz Rail shares were tumbling to April lows of around 35c.

Many other equities were low and, as one commentator has pointed out, it was difficult to lose money in the six-month period where Ruff Riders made theirs.

But, at 54 per cent return, the Ruff Riders were impressive.

They credited Tranz Rail and small company Cadmus Technology with the substance of their earnings.

Was it all just luck? No, says Toh. He believes this game is all about strategy. When to buy, when to sell, when paying a brokerage fee is worthwhile.

When the three gather for the interview it is Brown, the so-called pilot of the Ruff Riders, who does most of the talking.

The team were "bedazzled" by their win, he deadpans, settling in to share some secrets of their success.

Rugby players Casey and Colhoun and cricketer Brown are dedicated readers of the Herald's sports section.

Casey also quite likes the inside back page of e.g. - where the Hollywood gossip can be found - and backpage satirical column Sideswipe. That was about all they used to read.

But things have changed. The three are now fans of the business section and comment on the wisdom of columnist Brian Gaynor.

That's because being informed is an important rule of investing. It is also important, they advise, to minimise the risk, diversify (but not too much) and be patient if shares stumble.

Meanwhile, across town at King's College and Sacred Heart, other teens scrabbled close to the Ruff Riders' lead as the game drew to a close.

At King's College, Ludacris Stockbrokers spokesman Mitchell Kornman was disappointed they did not come first.

Kornman is familiar with the stockmarket game and already holds AMP and Contact Energy shares.

He and team-mates Andrew Crump, Cameron Charles and Daniel Harema spread the Ludacris portfolio wide across low-value stock.

Kornman said it was a mix of small increases rather than a standout company that pushed them into second place.

Third place-getter Camp Nacho was run in a hands-off fashion.

Hugh Chapman and Chris Goldsbury threw their money at Tranz Rail when its shares collapsed and watched as it shot up and made them $20,000.

Meanwhile, Ruff Riders are reinvesting. Consider it a free tip: Their $2000 prize has gone on Cadmus Technology and Heritage Gold.

Gerrard, to whom the team pay tribute for his assistance, is watching with interest: "I used to say to Alex 'I've got $10,000 ... what can you help me with'?"