Buy Low, Sell High

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Thanks to a national stock-market game, Wall Street's bulls and bears have become daily classroom companions for several hundred thousand students this year.

Sponsored by the Securities Industry Association, the program involves elementary and secondary students in a hypothetical world of buying and selling stocks.

In the process, backers say, students get a better understanding of the stock market and the factors that affect it, the costs and benefits involved in economic decisionmaking, and other economic and mathematical concepts.

In participating classes, students break up into teams of three to five players. Beginning with an imaginary $100,000 each, teams make their stock selections and send them to a regional computer center, which issues weekly statements on their portfolios, including current holdings, brokerage fees, and margin interest.

At the end of the 10-week competition, the team that has achieved the greatest increase in the market value of its holdings is the winner.

"We try to make the game as realistic as possible," said Dennis O'Toole of the Virginia Council on Economic Education at Virginia Commonwealth University, one of the regional coordinating centers for the program. In fact, he said, the game is so close to the real thing that students almost come to believe they own the stocks.

Usually students "will want to invest in volatile stocks," said Margaret Kerr, a mathematics teacher in Newport News, Va., who recently led her 5th-grade students through the game. Such "high fliers" can result in far more dramatic gains or losses during the competition than do the more stable blue-chip stocks.

Along with the sense of ownership, though, students can also fall victim to the financial anxieties that accompany sudden changes in the market, Mr. O'Toole noted. Many begin following dispatches from the citadels of finance with an intensity rivaling that of the most sophisticated arbitrager or junk-bond specialist.--jw

Vol. 08, Issue 24

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