student investment clubs: real world experience with financial markets
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$IC
Student Investment Clubs: Real World Experience with Financial Markets
Student Investment Clubs: Real World Experience with Financial Markets
Member ContrinbutionsMember Contrinbutions
• 15 members
• $25 contribution per month
• Total contributions per month = $375
• Contributions for 10 months/year = $3,750
• Contributions for 4 years = $15000
The Magic of Compound InterestThe Magic of Compound Interest• http://www.moneytoys.com/future-value-calculator.php
Financial Literacy FactsFinancial Literacy Facts• National consequences will result from a continued lack
of financial literacy. • Distribution of information is vital. • Being financially literate is a lifelong process. • Reaching youth is critical.• Educational materials should be used at teachable
moments.• Establishing goals is the first step to a financial future.• Storytelling is a highly effective teaching strategy.
(From National Endowment for Financial Education, Financial Literacy in America: Individual Choices, National Consequences, October 2002.)
Financial LiteracyFinancial Literacy
Income
Spending and credit
Money management
Savings and investment
Consumer Bankruptcies 2006, 2007Consumer Bankruptcies 2006, 2007
2007 2006NL 1,837 2,066NS 3,043 2,964 PE 259 281NB 2,126 2,103QC 21,282 20,497 ON 26,313 24,887 MB 1,720 1,907SK 1,271 1,523AB 4,038 4,553BC 5,589 6,058NT 26 36YU 17 20NU 3 2
Why a Student Investment Club?Why a Student Investment Club?• Provides skills for future financial literacy.• Emphasizes values of regular savings, financial
analysis, and group decision making.• Recognizes the value of long-term investing.• Recognizes the power of compound interest.• Provides a realistic environment to develop
investment goals and skills.• Connects economics, personal finance,
business math and entrepreneurship concepts to real world experience.
$IC Definition$IC Definition
A Student Investment Club is:– made up of 12 to 15 students who,– over their four years of high school,– learn the values of regular savings, financial
analysis, social learning and group decision making.
• Through the development of a real investment portfolio, which includes short and long term investments, the Student Investment Club gives its members an opportunity to become financially literate.
Getting StartedGetting Started
Start new SICs with 9th/ 10th graders– SIC will remain intact
throughout high school
Membership– 12 to 15 students
Officers– Chair, Vice-Chair,
Secretary, Treasurer, & Education chair
Constitution– Based on adult
investment club
SIC OrganizationSIC Organization
Formation
Officers
Membership
Dissolution
Constitution ComponentsConstitution Components
Procedures
Financials
Voting
Guests/ New Members
Banks/Brokers
Crucial DecisionCrucial Decision
Real Money?
Virtual Money?
SIC ActivitiesSIC Activities
Focus on Financial Literacy
Learn about investments, economics & financial liquidity
Review & analyze financial statements
Share info about investments & market sectors
Make appropriate investment decisions
Components of a Successful SICComponents of a Successful SIC
• SIC Leadership
• Partnership Development
• Content Coverage
• SIC Recruitment
• Communication and Public Relations
• “Money” Availability
Components of a Successful $ICComponents of a Successful $IC
• SIC Leadership• Chair, vice chair, secretary, treasurer,
education chair• Student mentors• Teacher-advisor
• Partnership Development• Stockbrokers, financial planner, adult
investment club
• Content Coverage
Components of a Successful $ICComponents of a Successful $IC
• SIC Recruitment• Recruit junior high/middle school students• Clone clubs as needed
• Communication and Public Relations• Web site• Invite community/school to educational activities
• “Money” Availability• Virtual versus real money• Fundraising activities similar to other
organizations
$IC Content$IC Content
Learning Stage ILearning Stage I Learning Stage 2Learning Stage 2 Learning Stage 3Learning Stage 3
Work Group Skills
• Parliamentary Law
• Team Work Skills
Economics/Financial Skills
• Market Operation
• Economic Concepts
• Financial Statements
• Financial Planning
Adv. Financial Concepts
• Business Statement Analysis
• Conducting Market Research
• Sophisticated Invest- ment Opportunities (such as index funds)
• Understanding risk
Continuing Ed
• Specialized Financial Topics
• New Sector Investment Opportunities
First Year Educational ContentFirst Year Educational Content
Parliamentary Procedures
• Agenda & Report development
• Discussion mgt.• Constitution
development• Rules & procedures
establishment• Committee
development
Teamwork and Group Skills
• Group norm development
• Group development cycle
• Conflict resolution
• Active listening
• Goal and timeline setting
• Group work ethics
• Presentation skills
First Year Educational ContentFirst Year Educational Content
Economic Concepts
• Scarcity• Opportunity cost• Supply & Demand• Comparative
advantage• Economic
indicators
Financial Concepts
• Personal financial “agenda”
• Financial opportunities
• Personal saving concepts
• Stock market basics
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