Macquarie, Australia’s leading investment bank, has funded a A$550,000 ($450,000, €330,000, £230,000) simulated trading room at one of the country’s private universities to help business students get a better grip on financial markets.
The project is a first for Australia and possibly worldwide, according to its proponents. While some universities in the US and elsewhere have simulated trading rooms, they are not generally linked to a specific bank and its trading models and portfolios.
Bond University, on Australia’s Gold Coast, will inaugurate the Macquarie trading room on May 14. It will feature state-of-the-art computer systems with dual screen technology and a data screen wall projecting a live feed as price movements run on an overhead ticker.
Established in 1989 as Australia’s first private university on land owned by Alan Bond, once the country’s leading entrepreneur, Bond University now has about a quarter of its 3,500 students in its business faculty, mostly studying undergraduate degrees in subjects such as finance and accounting.
Almost half the university’s students come from overseas.
About A$300,000 of the Macquarie funding was used to set up the trading room, with the rest due to cover the cost of maintaining the facility over the coming five years, including paying for live feeds. The project has been jointly funded by the investment bank and the Macquarie Foundation, its philanthropic arm.
Robert Stable, vice-chancellor and president of Bond University, says the trading room will provide “a fantastic tool for students who have not had the benefit of this hands-on experience”. But he also suggests the room could eventually allow the university to expand its offering, notably by starting new finance courses for the many pensioners who settle on the Gold Coast and may want to better manage their retirement funds.
Macquarie has installed a voice-over-internet protocol to enable communication between the university and the bank, but it remains to be seen how much interaction the students will be allowed with bank employees.
David Pryde, who designs IT infrastructure for Macquarie and was involved in the six-month project to set up the trading room, says: “We wanted to ensure that we provided all the infrastructure and information to simulate a realistic trading environment like ours. We didn’t want just to have the flashing lights and a bit of signage.”
One of the lessons he draws from the project is the big difference in attitude towards financial data and information between business school academics and floor traders.
“There is just a very different thought process. Traders have a perspective of just wanting to have access to everything, while academics want to pick and choose so as to have just what they need to teach in their lectures,” he says.