As our GHS school year comes to a close, so too does our year within the Investing in Your Future Club.
Club members this year learned many new things about investing in the stock market, as well as spent some time investing in their community by participating in the Annual FARE Walk to raise money for food allergy research.
As a club during the year we participated in the Ithaca Stock Market Competition and our own internal stock competition. In addition, several club members investigated the Knowledge@Wharton Competition and joined that competition.
Among the things we learned was how variable the stock market can be. During our days with the Ithaca competition this year, several of our groups started off with their portfolios performing fairly well. But then, the markets started a downward turn, from which they really didn't recover for the balance of the competition period. It became a game of trying to lose the least amount, rather than who could gain the most......much like many real investors experienced during that same time-frame.
However, some important take away's can be revealed from this experience. Students learned that you need to look at the companies you're investing in and not just pick stocks based on what others are doing in the market. You should develop a basic understanding of what your company is doing and how they are doing it. When the larger market takes a down turn, your company's stock may take a hit too, but if the company has solid products, sound financial performance and a good vision for where it needs to go in the future, the company can ultimately weather the short term storms.
During the year, we spent time analyzing companies. We looked at financial reports and compared and contrasted them. We discussed industries and learned about different financial ratios that analysts use to help them evaluate companies. We also learned about investing resources and shared tools and ideas across our groups. Furthermore, discussed the importance of diversifying your investment portfolio and having a long term plan for your investments.
One downside to participating in some of the stock market competitions that we discussed frequently over the year, is the short term approach the competitions may take to determining its "winners". I'm attaching an article published in the "Business Insider" from 2015. The article discusses the positive aspects of the competitions, "....teaching a new generation of investors about the stock market." But it does highlight the risk associated with the emphasis on short term gains that might be needed to win a competition. The "quick" gains various stocks may take during a short term competition period may not be indicative of the qualities of a company in which a real investor should invest his/her money. The competitions may minimize the importance of using some of the aforementioned real investment tools students should use when investing. The students listen to me repeatedly state these points throughout the year and hear my emphasis on the importance of doing real analysis before investing their money.
The best thing for me as the club adviser has been participating in the discussions and questions the students have asked over the course of the year. I love their inquisitiveness and their desire to know more about investing and their financial well being. It's been a great learning year and we've had a lot of laughs while doing it. I look forward to next year with the students as we Invest in their future!!
Joan McGrath
Investing in Your Future Coordinator
Club members this year learned many new things about investing in the stock market, as well as spent some time investing in their community by participating in the Annual FARE Walk to raise money for food allergy research.
As a club during the year we participated in the Ithaca Stock Market Competition and our own internal stock competition. In addition, several club members investigated the Knowledge@Wharton Competition and joined that competition.
Among the things we learned was how variable the stock market can be. During our days with the Ithaca competition this year, several of our groups started off with their portfolios performing fairly well. But then, the markets started a downward turn, from which they really didn't recover for the balance of the competition period. It became a game of trying to lose the least amount, rather than who could gain the most......much like many real investors experienced during that same time-frame.
However, some important take away's can be revealed from this experience. Students learned that you need to look at the companies you're investing in and not just pick stocks based on what others are doing in the market. You should develop a basic understanding of what your company is doing and how they are doing it. When the larger market takes a down turn, your company's stock may take a hit too, but if the company has solid products, sound financial performance and a good vision for where it needs to go in the future, the company can ultimately weather the short term storms.
During the year, we spent time analyzing companies. We looked at financial reports and compared and contrasted them. We discussed industries and learned about different financial ratios that analysts use to help them evaluate companies. We also learned about investing resources and shared tools and ideas across our groups. Furthermore, discussed the importance of diversifying your investment portfolio and having a long term plan for your investments.
One downside to participating in some of the stock market competitions that we discussed frequently over the year, is the short term approach the competitions may take to determining its "winners". I'm attaching an article published in the "Business Insider" from 2015. The article discusses the positive aspects of the competitions, "....teaching a new generation of investors about the stock market." But it does highlight the risk associated with the emphasis on short term gains that might be needed to win a competition. The "quick" gains various stocks may take during a short term competition period may not be indicative of the qualities of a company in which a real investor should invest his/her money. The competitions may minimize the importance of using some of the aforementioned real investment tools students should use when investing. The students listen to me repeatedly state these points throughout the year and hear my emphasis on the importance of doing real analysis before investing their money.
The best thing for me as the club adviser has been participating in the discussions and questions the students have asked over the course of the year. I love their inquisitiveness and their desire to know more about investing and their financial well being. It's been a great learning year and we've had a lot of laughs while doing it. I look forward to next year with the students as we Invest in their future!!
Joan McGrath
Investing in Your Future Coordinator