Category: Investing

Interactive: Can You Time The Market?

|
May 19, 2019
|
Interactive, Stocks, Investing
Another engaging interactive to dispel the notion that one can time the market.  Here's the description of the game (from Betterment) which is about 3-4 minutes long and can be played multiple times: Many investors believe (or act as if they believe) they can beat the market through timing their deposits or asset allocation. Our interactive simulation puts you in the driver’s seat to decide whether to invest or sell based on actual New York Times headlines since 1928. Click below...

Reading List for May 18-19

|
May 17, 2019
|
Financial Literacy, Economics, Investing, Parent Conversations, Career, Current Events
Financial Literacy New GFLEC study was released and teachers support mandated personal finance. (PRN Newswire) Tony Isola gives his take on the likely success (or lack of it) of mandated personal finance classes. The issue is not with the concept or the teachers…it is more about the structure of schools. Education/Higher Ed The Higher Ed headlines move from Varsity Blues to SATs new score. An “Adversity Score” being added to SAT scores. The student won’t know what...

QoD: How many of the 12 largest companies in 2000 were still one of the largest 12 in 2018?

|
May 12, 2019
|
Investing, Question of the Day, Stocks, Index Funds
Answer: 4 Exxon Mobil went from #2 to #11 Wal-Mart Stores went from #6 to #12 Microsoft went from #7 to #3 Johnson & Johnson went from #11 to #9 Questions: Compare the list in 2000 to 2018. Write one sentence that describes how the economy has changed in the past 18 years based on changes in the largest companies. Which industries have grown the most?  How many of the top 12 companies on the list in 2018 are you familiar with?  How has the value of the three companies that...

Reading List for May 11-12

|
May 10, 2019
|
Investing, Stocks, Advocacy, Credit Cards, Mortgages, Retirement
  Investing We will start with Investing this week because this week's biggest news is today’s Uber’s IPO. Here is all you need to know about the one of the largest IPOs! (NYT) Uber was priced at $45/share--the “low end,” and keeping the valuation at $82B, well below the expected $100B. Looks like “low end” wasn’t low enough. Watching CNBC Squawk Box as the market was “building the book” before the first trade was fascinating as the...

QoD: Nike or Under Armour: Which company's stock has performed better over the past five years?

|
May 08, 2019
|
Investing, Question of the Day, Stocks
Answer: Nike, by a long shot! Nike closed the trading day on May 1 at $85.27, up $35.77 on June 1, 2014, for an average annualized return of 19.35%.  Under Armour, on the other hand, closed the trading day on May 1 at $22.82, DOWN from its price of $29.75 five years earlier for an average annualized loss of over 2%. Here's the chart: Questions: What factors do you think contribute to the very different market performance of these companies? Which products do you personally prefer?...

Why we need financial education: Students underestimate power of compound interest and think savings accounts earn the highest returns

|
May 08, 2019
|
Compound Interest, Investing, Financial Literacy
The answers to these two questions from a recent workshop are a great demonstration of the need for financial education: When asked which of these investments would earn the highest returns, the most common answer was....Savings Accounts and 34% got the right answer:  When asked the question about how $1,000 growing at 7% annually would grow over 40 years (I read the question and emphasized ANNUALLY several times as Kahoot limits the characters in the question)....23 skipped the...

Chart of the Week: Company Lifespan on the S&P 500

|
May 07, 2019
|
Index Funds, Chart of the Week, Stocks, Investing
From Innosight's research on Creative Destruction: Key insights include: The 33-year average tenure of companies  on the S&P 500 in 1964 narrowed to 24 years by 2016 and is forecast to shrink to just 12 years by 2027 (Chart 1). Record private equity activity, a robust M&A market, and the growth of startups with billion-dollar valuations are leading indicators of future turbulence. A gale force warning to leaders: at the current churn rate, about half of S&P 500 companies...

Reading List for May 4-5

|
May 03, 2019
|
Economics, Paying for College, Insurance, Investing, Retirement, Current Events
Economics The jobs numbers were released today. 263,000 jobs were added and unemployment is now measured at 3.6%, a 49-year low. The NYT just published a primer explaining how this is measured. A second NYT article explains why it has taken so long for wages to rise in the recovery, and which sectors are experiencing the most wage growth.  Paying for college Apparently states in search of educated folks to fill jobs are offering assistance with student loan debt as a lure. (WSJ) We...

Reading List for April 27-28

Apr 26, 2019
|
Financial Literacy, Paying for College, Career, Payment Types, Investing, Economics
Financial literacy   Interesting data/graphs in this piece from pymnts.com on Americans’ inability to save money and how they manage their bills and debt. (Forbes) lists the six things high school graduates should have access before moving on in life….and yes, financial education is #1. Could early financial education lead to higher earning? (Benzinga) There are great anecdotes in this piece about not making your personal finance lessons (books, blogs, etc.) too...

Reading List for a holiday weekend (April 20-21)

|
Apr 19, 2019
|
Financial Literacy, Career, Investing, Behavioral Finance, Payment Types, Retirement, Current Events
Financial Literacy NGPF is in this list of quality free curriculum (and training) for personal finance teachers—no excuse for not being prepared!(Marketwatch) Need some inspiration this weekend? Read this Marketwatch piece about Troy Murphy’s pursuit of spreading financial literacy. NGPF fellow Kerri Herrild’s Giving Project and Daniel LaSalle’s Philly Financial Cooperative are the beneficiaries of Troy’s work. Then listen to the podcasts Tim has done with all...

Podcast: Investing Panel with Jonathan Clements and Bill Bernstein in March 2019

|
Apr 19, 2019
|
Investing, Podcasts, Stocks, Behavioral Finance
What follows is a summary of the Investing panel discussion held at the NGPF Summit in mid-March 2019 in San Francisco. The all-star panel included Bill Bernstein, financial theorist, neurologist, and financial adviser/author, and Jonathan Clements, WSJ columnist, author, educator and blogger at the HumbleDollar.com. Apologies for the inconsistent sound quality.  Details 0:00~4:25 Introduction 4:25~12:42 The stock market game’s traps 12:42~24:20 Importance of friends and...

Reading List for April 13-14

|
Apr 12, 2019
|
Financial Literacy, Investing, Payment Types, Career, Cryptocurrencies, Current Events
Financial Literacy Our second list of Financial Literacy Month includes some extra articles on the topic. An interview with the CEO of Chase Consumer Banking highlights her passion for financial literacy. (NYT) Annamaria Lusardi presents data/research on why financial literacy matters. (CNBC) Along similar lines, the St. Louis Fed discusses what financial literacy is. (St. Louis Fed) MarketWatch republished one of Jonathan Clement’s Humble Dollar posts with the 45 steps to having a...

Chart of the Week: Periodic chart for asset returns

|
Apr 09, 2019
|
Chart of the Week, Investing, Stocks
Hat tip to NGPF Fellow Charles Kafoglis for sending a note to me highlighting this set of charts from Callan Associates. Think of the chart below as the periodic table for stock market returns for various asset classes (think stocks and bonds, U.S. based and international). Each column represents one year and each box represents a specific asset class which has a specific color assigned to it. The percentages reflect the returns for that specific asset class. There's a lot to unpack here but...

Reading List for April 6-7

|
Apr 05, 2019
|
Financial Literacy, Current Events, Economics, Investing, Paying for College, Insurance
The list is a bit longer today--perhaps more good stuff is popping up during Financial Literacy Month.  In any case, there should be something for everyone here!  Financial Literacy Month CNBC to recognize Financial Literacy Month with special coverage all month.(CNBC) This was today’s CNBC post, crediting you wonderful finlit warriors for helping your students avoid payday lenders!   How much financial education is enough? (Cincinnati.com) What men can learn from the way...

Chart of the Week: Boom or Bust with Tech IPOs

|
Apr 03, 2019
|
Chart of the Week, Investing, Stocks
Hat tip to Morning Brew for highlighting this chart in their daily newsletter.  With a flood of IPOs about to hit the market (Pinterest, Uber and AirBNB to name a few), I thought this chart was an important reminder that not every tech IPO goes BOOM!    Questions: Why do you think that companies like GoPro and Fitbit have struggled so much as public companies? (Hint: are there other products similar to theirs?) Square is a top performer. Do you know what business they are in? Do...