Do you ever hear your parents or other adults use words like STOCK MARKET or WALL STREET or INVESTING? These are terms used to describe a very important part of the economy. You can own a part of a company, like Toys ‘R’ Us, by buying the company’s stock. Stock is an ownership share in a company. Buying stock is a way of investing in a company.
When you invest in a company, you are giving your money to the company to build up its business. If the business does well, you get part of the profits because you helped make it successful.
What company should you choose to invest in? That all depends on your research. Investors usually find out about a company by reading newspapers, checking out the company’s website, or doing background research in the library. All this information helps investors find out how successful a company is.
A good way to learn about the stock market is to play the Stock Market game. Ask your parents to help you play this game.
- Pick your favorite toy or video game and find out which company makes it. Let’s say, for example, one of your favorites is the Obi-Wan Kenobi Star Wars Action Figure. Hasbro, Inc., a big toy company, manufactures Star Wars toys. So, you look up the company’s symbol (in this case, HAS) in the financial section of a newspaper or on the World Wide Web.
A TICKER SYMBOL is an abbreviation of the company’s name used to identify it. To find the ticker symbol, check out the following sites:
NASDAQ.COM† or NYSE.COM†
- Use play money to buy $1,000 worth of stock from the toy company. Your mom or dad can act as a stockbroker. A STOCKBROKER is someone who buys and sells stocks for people.
- Each day check out the stock quote with your parents to see how well you are doing. Keep track of how well your stock is doing by plotting points on a graph. "Sell" your stock at the end of the month. Did you make or lose money?
The Mysteries of Money
Did you know the money that you see every day has many hidden mysteries? Ask your parents to help you find the following things on a $50 bill:
- Look at the collar of Grant’s shirt. In very small letters it says, "United States of America."
- Watch the color on the bill. The bill looks green when you look at it straight, but if you hold it at an angle, the color changes to black.
- Hold the bill to the light and you will see another picture of Grant, on the right side of the bill.
- You can also see a line with the words "U.S. 50" when you hold the bill to the light.
