Stock Market Contest

According to an article in the Toledo Blade (04/02), the Jones Leadership Academy of Business in Toledo is one of only two high schools in the country to have a simulated stock market lab. That is something that I feel the Toledo Public School district should be very proud of. The class is available to students during their junior and senior years. This is also the third year that the students have had a stock picking ‘challenge’. Students begin with a hypothetical amount of $100,000. They put their acquired skills to work to see who can make the most money.

Pretty cool, don’tcha think? I think it’s great if students are being prepared for a career in finance. Still, I have some concerns. I hope that they are also being taught that only around 6% of active large company growth managed mutual funds outperform the S&P 500 over a 20 year period. If big money mutual fund managers fail to beat the index, what hope do we have? I hope the kids learn the real secret to wealth accumulation for most mere mortals is a long time horizon and the use of low cost index tracking Exchange Traded Funds (ETFs). I hope that we are not just teaching these young people how to day trade.