Students get real-life investment experience
By Melanie Savage - Staff Writer
Hebron - posted Tue., Jun. 7, 2011
Most - if not all - of the students in Adam Parks’ fifth-grade class at Hebron Elementary School were completely clueless regarding the stock market at the start of the school year in September 2010. Stocks, bonds and mutual funds are not typical food for thought for your average 10- and 11-year-old kid. But with pension plans disappearing at an increasing rate, and Social Security no longer a given for those age 35 and younger, a knowledge of the global marketplace is becoming increasingly important for America's younger generations.
Parks has involved his students in the Stock Market Game, sponsored by the SIFMA (Securities Industry and Financial Markets Association) Foundation, for a number of years. According to the organization's website, SIFMA “is dedicated to fostering knowledge and understanding of the financial markets for individuals of all backgrounds, [providing] financial education programs and tools that strengthen economic opportunity across communities and increase individuals’ awareness of and access to the benefits of the global marketplace.”
The Stock Market Game “is an online simulation of the global capital markets that engages students in grades four through 12 in the world of economics, investing and personal finance,” according to the website. More than 700,000 students take part every school year across all 50 states.
According to a study conducted by Learning Point Associates, students who participated in the Stock Market Game “scored significantly higher on mathematics and financial literacy tests than their peers who did not.” Teachers who taught the game “reported the program motivated them to better plan for their future and to engage in financial planning, research and use of investment products and services,” the study said.
“Just imagine if they participated in the game from now through 12th grade,” said Parks. This year, Parks got 12 students from his class involved. “I did it with some of the kids as an enrichment activity,” he said. Students who scored high in mathematics pre-tests were invited to participate. Beginning in September, they were given $100,000 in virtual “cash” to invest. Parks filled them in on the basics of the market. “We discuss public and privately-traded companies, and go over the concept of price appreciation and depreciation,” he said. “I tried to also fill them in on the fact that there's no way to know exactly what the market will do. There's an element of luck to it.”
Students were free to work on the game during math, when finished with their normal lesson, and during academic labs, basically a free-choice academic period. “I will say that they were pretty independent,” said Parks. “They did the research and made the decisions on what stocks to buy, when to sell, on their own.”
A unique feature of the game is how realistic it is. “It's all in real time,” said Parks. “They actually have to pay commissions, they earn interest. They can buy on margin, short sell. It's all very realistic stuff.”
Parks’ students participated in the year-long e-version of the game (classes can opt to play for just the fall or the spring sessions). By the end of the year (April 29), Parks had two teams place in the statewide elementary division. Coming in first place was the team of Jordan Synodi and Ryan Fraleigh (with equity of $126,637.77). Coming in second was the team of Connor Romeo and Dylan Wawruck (with equity of $123,213.67). The teams were honored at a ceremony held June 2 in Hartford.
The students tended to gravitate toward companies that offered products that interested them. Synodi and Fraleigh, for example, researched Disney, Coca-Cola and Apple, among others. But stocks had to meet certain parameters, besides offering an interesting product. “We were looking for a 2-percent increase trend,” said Fraleigh.
“If it was going up too much, it might start going back down,” added Synodi.
Romeo and Wawruck used similar parameters in choosing stocks such as Nike, Cabella's Sporting Goods, Apple and Google. Disney, they said, wasn't doing well when they first considered it. “So we waited a while before we bought it,” said Wawruck.
A testament to Parks’ motivational skills was the experience of Lauren Opocensky. Though she wasn't involved in the game in the classroom, the fifth-grader was sufficiently intrigued to go home and enroll in the game on her own. She came in second place in the adult category.
The students all agree on one detail - the game was a lot of fun, and they'd love to participate again next year. “It was a fun activity, and it teaches you about the real stock market,” said Wawruck.
For more information about the Stock Market Game and other SIFMA-sponsored activities, go to www.sifma.org.