OTIS Online Trading and Investment Simulator

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Please log in to OTIS with the Email Address and Password you registered for your class.

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What is OTIS?

OTIS allows students to apply the concepts of investments and portfolio management in a hands-on learning environment while working with real-world data without risking real money. For instructors, OTIS provides unmatched analytical tools to evaluate and track their students' performance. Created by Marshall E. Blume, the Howard Butcher III Professor of Financial Management at the Wharton School of the University of Pennsylvania, OTIS offers invaluable practice for students learning about investments.

OTIS in Detail

How do you teach students the nuances of portfolio management? How can you teach them about the impact of market fluctuations on a $1 billion dollar portfolio?

The Online Trading and Investment Simulator (OTIS) takes financial instruction to a new level. It allows student "fund-managers" to buy and sell securities ranging from domestic and international equities to options and future contracts using real data from today's markets. In short, OTIS enables the student to acquire near real-world experience without assuming real-world risk.

Using a complex backend application, OTIS tracks a myriad of diverse securities, keeping real-time data on positions, trading histories, and dividends. Security types traded on OTIS include: all equities in the S&P 500, equities added by students, international equities in the S&P 700, active U.S. Treasuries, a selection of municipal bonds from every state, a representative list of corporate bonds from the S&P 500, contracts for all four types of futures (commodity, currency, index, and interest rate), options on equities, options and futures, all major mutual fund families, and all major exchange traded funds. Working with data in OTIS' hands-on learning environment, students grasp such key concepts as portfolio balancing and management, benchmarking, and the impact of large-scale fund buys and sells on market positions.

Wharton's OTIS is a tool for teaching students a set of financial management skills. The application underscores several key concepts taught throughout the course:

  • Portfolio balance and diversification - How portfolios are constructed and how to keep them balanced given the vagaries of the market.
  • Benchmarking - Many funds are built and measured against a standard, allowing investors to see how the fund is doing in comparative terms. Fund managers strive to show better performance than the benchmark; students running OTIS seek to outperform the S&P 500.
  • Liquidity - The mechanics of constructing the desired type of portfolio, strategies for entering and exiting the market, and the need for cash on hand.
  • Pricing - Funds have the potential to move the market with their buys and sells; students must learn how dramatic changes in the composition of their funds may affect the market as a whole.
  • Sector Analysis - Creating industry sectors and assessing the relative returns of securities within and across sectors.
  • Short Selling - Learning how to use various types of trading orders, including short selling and stop limits, to profit from market declines as well as increases.
  • Margin Trading - Understanding the mechanics, risks, and requirements of margin trading.

OTIS mirrors the sophisticated interface of many commercial trading applications used in the market today. It is completely web-based; there is no software to load. It includes screens for trade history, positions (showing current or historical holdings), book value, current market value, trading, news, and context-sensitive help.

The screens have distinct functions as follows:

  • Trade - Allows students to enter individual trades, view their current open orders, or, for North American Equities only, upload batches of trades from a spreadsheet.
  • Positions - Shows students their current or historical holdings in each of the securities. It also gives current book and market values.
  • History - Gives the history of every transaction made in the portfolio. The students can also drill down to get detail data on any transaction.
  • Sectors - Allows students to manage their sector groupings. Students can group companies into any number of sectors and then change the assignments through the semester.
  • Analytics - Allows students to analyze the performance of their portfolio. The analytics section has a drop-down menu that lists a wide variety of data sets and analysis reports on portfolio performance. Available reports include Gain/Loss, Sharpe Ratio, Sector Return, and Portfolio Value and Holdings Change. In addition, all data is downloadable for further analysis.
  • Performance - Here, students can assess their performance throughout the semester and compare their own portfolios with those of their peers and, if they have selected one, with a benchmark portfolio.

OTIS includes a set of analytic tools that students can use to evaluate their own performance as well as compare it to the S&P 500 benchmark and the performance of their fellow students. The analytic toolset includes information on alpha (daily and over time), standard deviation, variance, returns on portfolio, returns for S&P 500, and historical investment returns. This robust set of analytic tools is one of the real advantages of the application.

Students can also assign equities to a sector and generate an attribution analysis - a breakdown of returns and performance from each sector. They can also profile their sector-weighting - the distribution of equities chosen in the various sectors.

The calculation of variance of alpha is one of the primary scoring systems of the exercise. The goal is to outperform the S&P 500 on a consistent basis. In order to track their performance, students use the information ratio, which measures the alpha (return) against the benchmark.

Most of these calculations are transparent to the student; processes and procedures are constantly running in the background and are displayed when students request a given analytic. Displayed in the form of graphs and sets of data, these visuals help students better comprehend their performance day-to-day. To verify calculations made by the program, students can download the data to a spreadsheet.

Data in OTIS comes from FTID, with a twenty minute delay from real-time. Equity and ETF orders placed during trading hours are filled with a delay that mimics the data feed delay and are based on exchange: NYSE and AMEX - 20 minutes, NASDAQ - 15 minutes. All other security types trade once a day at the end of the day. In this way, student orders are processed in a fashion which is consistent with what actually happens in the market. For example, if a user places a trade for KO at 10:00AM, the order is filled at 10:20 AM at the 10:00AM price.

Many additional complex processes are running in the background before the market opens, during the day, and at market close. These include calculations related to stock and option splits, companies leaving the S&P 500, bonds being called, etc. The application is designed to simulate real world conditions as closely as possible.

As an instructional tool, OTIS can form the basis for regular assignments and in-class discussions, or it can be used for supplementary practice and application. The instructor can create assignments based on individual, team, or whole-class participation. Instructors can provide regular feedback to students throughout the simulation, or let them work on their own, checking in periodically or at the end of the simulation. The Instructor Options pages give the instructors full access to managing their active and historical classes.

The Instructor Options pages display a view available only to instructors so that they can conveniently manage all of their currently active, upcoming, and completed classes. On the left-hand side of the page is a list of all the available instructor tools and resources. These instructor pages provide a similar, complementary view to the student's pages, so that an instructor can readily switch from one view to the other. The instructor also has the ability to switch into student view by launching a class from the Instructor View. This launch function and other options are as follows:

  • Launch Class - Allows instructor to open the selected class in the same browser window and run the simulation from the student view.
  • Edit Class - Allows instructor to change the settings for the class. Settings include start and end date, the starting balance of cash for each portfolio, and the ability to allow students to sell short and trade on margin.
  • View Roster - Shows instructor the current roster of students enrolled in the class and allows them to delete students individually.
  • View Reports - Allows instructor to create and view quick reports for the entire class, including Latest Portfolio Value, Trading Activity, Number of Logins, Full Trading History, and Day-by-Day Positions.
  • Post News - Here, instructors can post the latest news item to a single class or to all of their active classes at once.
  • Edit News - Allows instructor to view, edit or delete news items added from the Post News page.
  • Delete Class - Allows instructor to delete any future or completed classes individually.
  • FAQ - Shows a list of frequently asked questions and allows the instructor to click on a link to view a PDF version of the Instructor Quick Start Guide.

Register With a Class Code

Welcome to OTIS! Your Class Code is provided to you by your instructor, and your password must be a minimum of 10 characters long.

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By registering for OTIS, you agree to the Terms of Use.

I Don't Have a Class Code

Please get in touch with the instructor of your class to receive a Class Code with which to register. A few other things to check:

  • The code may be included in an email as a link when the class was created.
  • Please don't forget to check your spam folder to ensure it arrived properly.

Would You Like More Information About OTIS?

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