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Students are learning about economics early thanks to the … STOCK MARKET GAME

stock-graphic_rgbMost people don’t play the “stock market game” until they are adults trying to figure out how to invest their money for the best return. The lessons learned can come at great expense.

But now more than 60,000 4th through 12th grade students in Mississippi have gotten a lesson in economics and the stock market by playing the Stock Market Games that gives student teams across the state $100,000 virtual dollars to invest.

Selena Swartzfager, president of the Mississippi College on Economic Education at Millsaps College, which sponsors the program, said the nice thing about the game is that students can learn how the stock market works without losing their money.

“It is a valuable program for use in the classroom for workforce training,” Swartzfager said. “Students who complete the program know what the stock market is and how it drives our national economy.”

One simple lesson is regarding mutual funds. Mutual funds spread out the risks more than investing in individual stocks.

“It is a much safer way to invest money over the long term,” Swartzfager said. “Every year at the awards ceremony, which will be held on May 8 this year, I am amazed at the ability of students to tell you why diversification is important when investing.  Many of them can tell you what the Standard & Poor’s 500 is and how their investments made in the SMG performed in relation to the S&P 500.”

Spring trading is in session through April 17.  Winning teams will be announced, and invited to the annual awards ceremony where they will receive cash awards.

In addition to piquing the interest of students in how the national economy works, and the impact of that on stock market values, the game teaches math skills — and does it in a way that makes practical sense to students.

“Students who compete in the SMG show an increase in financial literacy test scores and mathematics,” Swartzfager said. “Students are working with percentages, graphing the performance of stocks over time, and working with formulas.”

One of the greatest advantages of the SMG is it teaches students how to build wealth over time.

“Even though the game only lasts a few months, it acts as a platform to teach students sound investment principals,” said Daniel Wasilenko, the adviser for the Biloxi High School team that won the SMG in 2014. “So often we want to be the hare and get there quickly. But the safe way is to be the tortoise. Another advantage of the game is it teaches risk reward and how to measure risk at different stages of our life. Many of my students have already become involved in investing for their future through the stock market.”

As far as national finances, Wasilenko likes that the game allows students to grasp the concept of debt. His students learned that not all debt is bad. Companies as well as municipalities must borrow sometimes in order to grow their business, city or state.

“However, they came to understand what bad debt is, also,” he said. “They came to understand through the SMG how debt is rated and what the results of a credit downgrade mean to borrowers such as the U.S government.”

Wasilenko likens the SMG to “getting kids to eat their veggies without them knowing.”

“It’s a great program which encourages math skills through economics,” Wasilenko said. “Students who participate in the SMG use percentages, addition, subtraction, division, as well as estimation and rounding. Its a great program which allow students to understand how math can be used in real life.”

Also, teachers have reported back that participating in the game has affected student’s career choices. Maybe before the student didn’t realize economics and finance are career choices.

“It has affected young people’s lifelong goals,” Swartzfager said. “That is not the sole purpose, but it is nice when it affects career choices.”

Most schools in Mississippi now offer Information and Communication Technology II to their 8th graders.  This course includes a module on personal finance.

“We encourage the teachers of ICT II to incorporate the SGM into the classroom,” Swartzfager said. “We also find an easy fit in the STEM (science, technology, engineering and math), mathematics, personal finance and economics classrooms. We provide professional development to teachers statewide every spring and fall semester which equips them with the knowledge and tools they need to teach the SMG.”

The Mississippi College on Economic Education offers SGM statewide to 4-12 grade teachers and students. In addition, MCEE is promoting a new program called Invest It Forward to connect MCEE to community volunteers and teachers.  Community volunteers with a knowledge of the stock market can sign up at www.mscee.org/support to be a guest speaker.  MCEE will then go through the process of matching volunteers with teachers throughout the year.

Thus far the program has only been used in grades 4-12. But this year Mississippi State University plans to use it for college students for the first time.

“That is a new thing for us,” Swartzfager said.

The SMG is currently sponsored by Trustmark, BancorpSouth and Atmos Energy.  In addition, participating student teams pay team fees of $17 per team. Swartzfager said these teams are often in need of sponsors to pay the fees on their behalf.

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