Researching Individual Stocks

Today we will complete our Individual Stock Research project.  You are finding 9 stocks that are interesting to you which you will be using when we begin our Virtual Stock Exchange project.

We will also be discussing what the "range" means (52-week low/high) and what the news has to do with stock value.

Before you join our Stock Market Simulation, make sure you understand the rules.  You will receive $10,000 in virtual money (no, you don't get to keep it) to invest in stocks as low as $.50 in value.

You can join via Market Watch here: http://www.marketwatch.com/game/khs2014 (password: knights)

If you are required to join Market Watch, know that you don't have to provide much detail.  I gave them my real email address (which you will need to verify the account) and I set both my occupation and industry as "Education."  I gave them a birth year, but that's really not their business either.  Finally, note that I un-checked all of the "Newsletters and Alerts" and "Communications preferences" boxes.

There are a variety of strategies for "playing the market" -- and millions of dollars are made every year on books telling you how to do it.  The strategies are endless.  Some suggest investing in "penny stocks" -- others in "blue chip stocks".  Some tell you to buy when a stock has taken a total nosedive and some will tell you to buy when it's on its' way up.  Some tell you to invest in one risky stock and others advise you to diversify your investment.  There's no "right way" to invest in the stock market.  It's all at risk.

For my challenge (since it's not real money) I went to look for cheap stock [you can buy more stocks that way] but I wanted a large company.  I found an article for "Billion Dollar Companies With Stocks Under $10" here: http://www.cnbc.com/id/44962045/Billion_Dollar_Companies_With_Stocks_Under_10

The problems with having large numbers of low dollar stocks is that the value of your portfolio is more volatile.  I went from being in first place in our Stock Market Challenge to almost last place... and back to first within an hours time.

Why is Personal Finance an Important Class?

As you have probably heard me say many times, I truly believe that "Life Skills and Personal Finance" is the single most important class you will ever take in high school.  It demonstrates principles of spending, saving, and money management as well as career research and planning and preparing you for living on your own.

Some of the major components of this course include:

• Professional Portfolios: Our first portfolio check was last week.
• Personal Finance: We will be working through budgeting, spreadsheets, etc. and will begin a series of videos by Dave Ramsey, a nationally syndicated financial planning expert. We will also be working through a banking simulation unit using checks, ATM cards, etc.
• Life Skills: These will include renting an apartment, buying a car, looking for roommates, dealing with babies, handling stress, exploring college choices, etc.

Today will be watching a few short video clips by Dave Ramsey.

Before we begin, let's quickly discuss the following:

1. About what percentage of marriages end in divorce? 
2. What is the number one cause for divorce in America?
3. What is the number one cause for male suicide in America?

[Watch: GETTING STARTED > ORIENTATION]

Before the next video let's discuss the following:

1. "Griffs financial experience." or... "Why you should listen to me."
2. "I wish someone had told me..." or... "What would you tell yourself if you could go back in time?"

[Watch: GETTING STARTED > DAVE'S PERSONAL TESTIMONY]

Before watching the next video, let's discuss the following:

1. Have you ever played a game with someone who didn't tell you the rules?
2. Ever have someone change the rules while you were playing because you didn't know any better?
3. Would you like to play a game where those you were playing the game with knew the rules better than you did?
4. How likely is it that you could win a game you didn't know how to play?

This video clip from the movie "Stripes" demonstrates this point:

While watching the next video [Chapter 1: Savings - Part 1] answer the following questions in Microsoft Word -- but don't print yet.  We will continue next week.  (Let me know if we need to pause for a moment or if you have a question.)

1. The best way to become a millionaire is _____________.
2. Baby Step 1 is __________ in an emergency fund.  
3. If you make under $20,000 a year, put ____ in an emergency fund.
4. ___________ must become a priority.  Always pay ________ first.
5. What country saves the most money?
6. The United States has a _________ savings rate.  Which means we are __________ more than we ____________.
7. Saving money is about __________ and ____________.
8. Money is __________________.

Next Week:  Remember the bring in the "Ask Someone Who's Been There" (4 people) page and the "Ask Someone Who Knows: Budget Questions" by Tuesday.