Introducing Gemy Zhou, the award-winning stock trader who achieved a remarkable 440.4% gain for the year in the United States Investing Competition of 2022. His success was due to his knowledge of data science and coding, which enabled him to create his own stock-trading computer program. While Zhou’s performance is impressive, Norman Zadeh, the founder of the competition, cautions that it is a combination of skill and luck, and that anyone trading in the stock market should be happy with a 5-10% gain.
Gemy Zhou’s journey to success began in 2004, when he tried trading Chinese stocks on the Shanghai Stock Exchange. After barely breaking even, he concluded that trading wasn’t for him and moved to Canada. With time on his hands, he decided to study data science and machine learning, and by 2020 he was experimenting with data and coding programs for trading. He gathered stock data by using Python to scrape 20 years’ worth of historical information from places like Yahoo Finance, and used this data to infer the relationship between features and outcomes. His program then spent the year executing trades on his behalf automatically and earning him the impressive return.
Zhou’s program trades stocks ranging from pennies priced under $1 a share to large-caps, and makes about 20 to 50 trades a day. The number of shares is determined by a preset amount and the availability of the market supply at the time. The program executes long and short positions, and when the first order is placed to enter a position, the second order (closing order) is also placed at the same time at a calculated price.
The challenge for Zhou now is maintaining the performance of his program by adjusting it to match market conditions. Matt Monaco, a 24-year-old stock trader who made over $1.4 million in two years, believes that the combination of retail traders and their use of machines to trade will continue to increase. Although Zhou’s performance is impressive, it is not something that can be easily repeated. As Norman Zadeh said, anyone who can make significant returns in the market should be particularly proud of themselves because the stock market isn’t a completely level playing field.