New Fellow Education Transfer Plan
Title of ETP Stock Market Simulation
Name of IISME Fellow Kent Ezell
Fellow’s year-round email firstname.lastname@example.org
Sponsor Company Solectron
Name of Mentor Jennifer Shepherd
National Board Certificate Middle School Math
I, the IISME Fellow named above, affirm that the ETP I am submitting is my own work, that I
acknowledged sources where appropriate, and that I avoided including any proprietary information
of the Sponsor Company. By my submission I am assigning to IISME my entire copyright in the
ETP. I understand IISME is simultaneously granting me a license to use the ETP for pedagogical
Objectives See attached sheet
Abstract (50 words or less) Students will learn basic Stock Market terminology. They will learn
how to buy and sell stocks, create formulas and graphs to track
their progress, and work a two-month simulation of stock market
trading. Emphasis will be placed on practical application to daily
math lessons as well as applying Biblical principles to Money
Describe how your ETP
aligns with the National
Board Standard stated in See attached sheet
This document can be downloaded from http://iisme.org D4
under Summer Fellowships, Fellowship Forms.
Page 1 of 2
Describe the connection
between your ETP and the
Summer Fellowship. Solectron is a prominant figure in the Stock Market. Students will
use this company as a foundation for understanding how
companies function in the stock market.
Throughout my fellowship I worked in a work world that was highly
sophisticated. I began to see how my students would need to be
able to use analytical thinking skills. I also spent extensive time
working on the internet and with Excel spreadsheets. All of these
components are woven into my Stock Market Simulation.
Evaluation/Assessment Pretest, Oral report, weekly assignments, Excel spreadsheets,
Measures Used graphs, final assessment test
Formatting specifications PC ____ or Mac__X_ (Must be in Word or Text Format)
Software used Microsoft Excel
Submitted Copy Soft and hard copy due to peer coach by the end of the summer
fellowship. Also, a copy of the cover sheet signed by a school site
administrator submitted to IISME Oct.3, 2004 to receive $300 grant.
I, the Mentor named above [please select one of the following],
have read the attached ETP, and my comments, if any, appear below.
have read the attached ETP, and, as outlined in the IISME-Company Fellowship
Agreement, have reviewed it on behalf of the Sponsor Company, and have determined that
the ETP does not contain any Sponsor-proprietary information. My additional comments, if
any, appear below.
This document can be downloaded from http://iisme.org
under Summer Fellowships, Fellowship Forms. D5
Page 2 of 2
Table of Contents
I. Scope and Sequence
a. Student Objectives
b. National Standards
II. Lesson Plans
a. Stock Market Simulation Weekly Lesson Plans
b. Lesson Plans to Teach Excel
c. How Does News Influence Stock Prices
d. NYSE Stock Market Savvy Lesson Plans
III. Student Pages
a. What is the Stock Market Pretest
b. Stock Talk: Market Terms
c. Key Vocabulary
d. Whose Money is it, Anyway?
e. Stock Market Tutorial
f. How to Read Stock Tables poster
g. Understanding: Stock Tables
h. Yahoo! Finance Activity
i. Research a Company
j. Stock Ownership: A Delicious Topic
k. Worksheet for Graphing
l. Market Cycles: What Drives Stock Prices
m. Final Assessment
IV. Teacher Answer Keys
a. Answers for Key Vocabulary
b. Stock Market Research Report List of Companies
c. Stock Market Company Oral Report Rubric
d. Answers for Investing for Kids Tutorial
e. Final Assessment Answer Key
V. Teacher Resources
a. The Proverbs and the Idea of Money
b. Explaining the Stock Market to Kids
c. What Money Can and Cannot Buy
d. A Selection of Money Quotes
e. Vocabulary Matching Game Pieces
Stock Market Student Objectives
1. Students will understand basic stock market terminology.
2. Students will be able to find and identify companies by name and symbol.
3. Students will be able to chart the progress of specific stocks over a two-month
period of time.
4. Students will be able to calculate and graph progress of specific stocks in a
5. Students will be able to create formulas in an Excel spreadsheet.
6. Students will find connections between in-class math work and applications in
real world situations.
7. Students will use discernment and problem solving skills to choose stocks to buy
8. Students will apply Biblical principles to their financial management.
Numbers and Operations
1. Understand Number
a. work flexibly with fractions, decimals, and percents to solve problems
2. Understand Meanings
a. understand the meaning and effects of arithmetic operations with fractions,
decimals, and integers
b. understand and use the inverse relationships of addition and subtraction,
multiplication and division, and squaring and finding square roots to
simplify computations and solve problems
3. Compute Fluently
a. select appropriate methods and tools for computing with fractions and
decimals from among mental computation, estimation, calculators or
computers, and paper and pencil, depending on the situation, and apply the
b. develop and use strategies to estimate the results of rational-number
computations and judge the reasonableness of the results
1. Understand Patterns
a. represent, analyze, and generalize a variety of patterns with tables, graphs,
words, and, when possible, symbolic rules;
b. relate and compare different forms of representation for a relationship;
c. identify functions as linear or nonlinear and contrast their properties from
tables, graphs, or equations.
2. Use Mathematical Models
a. model and solve contextualized problems using various representations,
such as graphs, tables, and equations.
3. Analyze Change
a. use graphs to analyze the nature of changes in quantities in linear
Data Analysis and Probability
1. Formulate Questions
a. formulate questions, design studies, and collect data about a characteristic
shared by two populations or different characteristics within one
2. Develop and Evaluate
a. use observations about differences between two or more samples to make
conjectures about the populations from which the samples were taken
b. make conjectures about possible relationships between two characteristics
of a sample on the basis of scatterplots of the data and approximate lines
3. Understand and Apply
a. use proportionality and a basic understanding of probability to make and
test conjectures about the results of experiments and simulations
b. compute probabilities for simple compound events, using such methods as
organized lists, tree diagrams, and area models
1. build new mathematical knowledge through problem solving;
2. solve problems that arise in mathematics and in other contexts;
3. apply and adapt a variety of appropriate strategies to solve problems;
4. monitor and reflect on the process of mathematical problem solving.
Reasoning and Proof
1. make and investigate mathematical conjectures
2. select and use various types of reasoning and methods of proof
1. recognize and use connections among mathematical ideas;
2. understand how mathematical ideas interconnect and build on one another to
produce a coherent whole;
3. recognize and apply mathematics in contexts outside of mathematics
Stock Market Simulation
ETP Presentation by Kent Ezell
Lesson Plans (One day a week)
Introduce Stock Market Simulation. Highlight main ideas and objectives to be
covered this semester. Make connection between math that is learned in class and
real world application.
Give the “What is the Stock Market” Pretest located in the student pages.
Assign students to do the “Stock Talk” skit. Have students fill in the answers with
a partner. Go over the answers together as a class.
Go over “Key Vocabulary” of the stock market. The vocabulary sheet is found in
the student pages. Have students fill in the words that match the definitions.
Assign students to read “Whose Money Is It, Anyway” found in the student
Discuss with the class what the Bible says about money. What were the steps
Larry Burkett laid out? How do they apply to our lives?
Students will need to use a computer with internet access. Have students read,
“The Stock Market” found at http://libray.thinkquest.org/3088
Give students the worksheet “Stock Market Tutorial” found in the student pages.
The information is found at the thinkquest website.
The worksheet is due next week Friday.
Collect the worksheet from the students. Go over answers that are found in the
teacher answer section.
Hand out “How to Read Stock Tables” posters. Talk through the different parts of
the table with the students.
Have students complete “Understanding Stock Tables” on their own. Walk
around the room to check for understanding.
Take the students to the computer lab. Have the students log on to the website
finance.yahoo.com. Have the student click on “Symbol Lookup.” Show the kids
how to find the symbol of the company. Type in Coca-Cola in the box. See how
Coca-Cola’s symbol is “KO”
Have the students do the other five companies on the Yahoo! Finance worksheet
found in the student pages. hhhh
Highlight for the students the key features that they will be using. Have the
students do the rest of worksheet “Yahoo Finance Activity.” Make sure the
students each have SLR (Solectron) as the company on the screen.
Walk around the lab to make sure students are doing the worksheet correctly.
The worksheet is due next week Friday.
Bring the students to the computer lab. Assign each student a company to
research. Make sure the company is large but not one that the students would
Tell the students that they will be giving an oral report on the biography of the
company next week Friday, and they will need to give a hard copy to the teacher.
Explain why they are researching a company before they buy its stock. Use the
quote from Peter Lynch - go with what you know. “During a lifetime of buying
cars and cameras, you develop a sense of what’s good, what’s bad, what sells,
and what doesn’t. If it’s not cars you know about, you know something about
something else. And the most important part is, you know it before Wall Street
Go over the instructions of worksheet “Research a Company.”
The students will give their oral reports. Use the rubric in the teacher answer
section to assess it.
Students will need to work at a computer with Excel on it.
To briefly explain how a spreadsheet works, go to http://www.school-
resources.co.uk/FramesForKS3SpreadsheetQuiz.htm. Work through labels,
formulas, values, and symbols. Once students have a basic understanding of how
a spreadsheet works, they will be able to create their portfolios.
Use the Lesson Plans “Teach Excel” to show students how to create formulas.
They will be creating a Cash Balance Sheet and a Portfolios Sheet.
Read “Stock Ownership” together as a class. Have students answer the questions.
Discuss with students how to choose stocks. Remind them of Peter Lynch’s quote
– go with what you know.
Students will need to pick between 7 and 10 stocks. Give students an opportunity
to use Yahoo Finance to research a variety of stocks. They will need to have their
stocks chosen by next week.
Students will ‘buy’ their stocks. They will be choosing which stocks they want to
purchase and how many shares of each stock. There will be a $15 commission on
each buy or sell. Students will only be allowed to buy/sell on Fridays in class.
They will need to create a graph for each stock they purchase. Use “Graphing
Stocks,’ as a reference for instructions on how to graph. Have students use the 52-
week highs/lows for setting up the range of their graph.
* Have a stack of graph paper available throughout the unit for students to pick up as
they purchase new stocks.
Each week students will plot their new points for each stock they own. As they
sell, they will mark the selling price and date of sale. For each new stock they
purchase, they will enter the purchase price and date of purchase.
Students will buy/sell stocks based on their productivity.
Students will fill in their excel sheet and plot their graphs each week. These will
be turned in before they leave class on Friday and returned to them the following
Students will be encouraged to dialogue with their peers as to the success or
failure of their chosen stocks.
Final Evaluation: Students will be assessed on their understanding of how to read
a stock market page, how to buy/sell stocks, and understanding of the
Enrichments to becompleted during weeks 9-20:
How news affects the stock market – see Lesson Plans “How Does New
Influence Stock Prices” – teacher will need to create questions based on current
events, samples are given in the lesson plans.
Fieldtrip to the San Francisco Stock Exchange
Guest speaker – parent who is actively involved in the stock market. Explain
how he got involved, why he enjoys it, and any advice for students.
Lesson Plans to Teach Excel
(The teacher should have a basic understanding of Excel to execute this lesson plan.)
1. Have the students open a blank Excel spreadsheet.
2. The students should name their spreadsheet by doing a “Save As.” Call it
“Stock Market -<student’s name>”
3. On the bottom of the spreadsheet, rename “sheet1” to “Cash Balance”
a. Click on the tab (it says Sheet1) using the right mouse button
(Macintosh computers should click on the tab at the same time
holding down the “Control” key.)
b. Click on “rename sheet.”
c. The tab should be highlighted which indicates that the tab is ready
to be changed.
4. Rename “sheet2” to “Portfolio Balance”
Cash Balance Sheet
6. Click the “Cash Balance” sheet tab.
7. Title your sheet by putting the school’s name in box A1
8. Take your mouse and highlight the cells A1 through G1.
9. Then press the “merge and center” button. This should spread out your
Title across the spreadsheet. You may have to extend or not extend as
much over the cells if at the end of the lesson plan the title is not centered.
10. On cell A3, type in “Date”, A4 type “Description,” A5 type “purchase
price,” A6 type in “Purchase Price,” A7 type in “Amount of Shares
Purchased,” A8 type in “Total Cost of Purchase” and A9 type in
11. Since the students have 100,000 to spend, type in 100,000 in F4
12. Put your pointer in-between column “A” and “B,” your pointer should
have changed into arrows. With your mouse held down, move the mouse
to the right until it says “20.00.” Do the same for “purchase price,”
“Amount of shares purchased” “Total Costs of Purchased” and “Balance,”
but drag those until it says “15.00.”
13. In cell A5, put the date of purchase for a stock.
14. In cell B5, put the description of the transactions. Since this is a cash
balance sheet. The description here should only be either purchased a
stock or sold a stock.
15. In cell C5 and C6, put in “purchase price” and “amount of shares
16. In cell E5, put in the formula “=(C5*D5)” It is important to explain to the
students how to make a formula, so that in the future the students will be
able to make their own formulas.
a. All formulas start with the “=” sign
b. All formulas use the order of operations standard
c. Have the students use parenthesis to make the formula
d. Total cost of purchase is cell C5 times D5.
17. In cell F5, put the formula “=(F4-E5).” Teach the students how the
18. Do the same for all the other stocks purchased.
19. If stocks are sold put a minus sign in front of the amount of stocks sold.
For example, if 1000 stocks are sold, then the cell in the Quantity of stocks
column should be “–1000.”
20. Click on the “Portfolio Balance” tab
21. Title the sheet like in the “Cash Balance” spreadsheet
22. In row 3, put in each subsequent cell Date, Description, Quantity of
shares, purchase/sell price, current stock price, change in portfolio, and
23. Set up the size of the cells like in the “Cash Balance” sheet
24. Have students put in the date of purchase, description of the stock,
quantity of stocks they purchased, and the purchase price. (Leave Current
stock price alone for now).
25. In cell F5, teach the students the following formula, “=(C5*D5)”
26. In cell E5, copy the amount from F5
27. Each week the student will monitor the progress of the stock. If the stock
changes, then an entry will need to take place. If the stock goes up, then
put the date and the description, and put into the “Current Stock” column
the price currently.
28. Then put in a formula that looks like,” =(E6-D5)*C5” into “Change in
29. Then in the “Portfolio Balance” column, put the following, “=(G5+F6)”
30. If the stock goes down, the formulas in “Change in Portfolio” and
“Portfolio Balance” will not change. You will get brackets around the
number in the “Change in Portfolio” to indicate that the number is in the
31. I suggest that you keep each purchase together. For example, if the
student purchases 1000 shares of Microsoft, then have the subsequent
lines be about how those 1000 shares are doing. See diagram below.
Microsoft Group Solectron Group
How Does News Influence Stock Prices?
Subjects: Economics, business, language arts, and social studies
Time Period: One class period
Resources: Internet access and/or newspapers
Objectives: Students will learn that economic news and business events can change
the price of a stock. They will see that the unexpected events that benefit or harm the
company will in turn move the company’s stock price up or down. Certain internal
and external factors will affect share prices. By learning about the relationship
between business events and share prices, students will be able to form a strategy in
buying and selling stocks for the Global Stock Game (GSG).
Background: A number of factors influence share prices.
Some internal factors include:
• Earnings growth
• Sales growth
• Product release
• Leadership changes
• Lawsuits pending
Also, some external factors change the share prices:
• New market competition
• Economic news such as interest rates and inflation
• Government policy changes
1. Teachers will select news from newspapers or Web sites like Yahoo!, MSN, CBS
Market Watch, and the Wall Street Journal interactive edition.
2. Next, the teacher will read the business news concerning a specific company or
the general economy to the students.
3. Then, the teacher will ask questions about how these events would influence the
share price of the company or the stock market in general. There will be four typical
• Share prices will likely increase
• Share prices will likely decrease
• Share prices will likely be unchanged
• Not enough information to determine
Here are examples of news events and the likely responses.
After the meeting of the Federal Reserve’s open market committee, Chairman Alan
Greenspan declared an increase of 0.25% in interest rates. Share prices of the real
estate companies and home builders will likely: Answer
• can’t determine
U.S. productivity sees 6.4% increase, the largest gain since 1992. Share prices of
General Electric, IBM, and 3M will likely: Answer
• can’t determine
1. Oil prices hit $34 per barrel, the highest since the Gulf War. Share prices of United,
South West, and Delta airlines will likely: Answer
• can’t determine
2. Judge Jackson rules that Microsoft has a monopoly on PC operating systems.
Share price of Microsoft will likely: Answer
• can’t determine
3. AMD begins shipping a microprocessor that achieved an industry milestone with
a clock speed of one gigahertz, processing one billion bits of information a second,
the computer industry's equivalent of breaking the sound barrier. Share price of
AMD will likely: Answer
• can’t determine
4. Because businesses no longer fear Y2K, PC shipments are expected to rise 20%
from the first quarter a year ago. Share prices of Dell, Intel, and Compaq will
• can’t determine
5. Al Gore claims he invented the Internet. He is leading the polls and will most
likely become the first president of the new millennium. Share prices of Yahoo!,
AOL, and eBay will likely: Answer
• can’t determine
6. Yahoo!’s “Surprise Earnings” news reported that Procter & Gamble, maker of
Crest toothpaste and others, projected that earnings will be 21% below the Wall Street
experts’ (analysts) estimate due to higher expenses. Share price of P & G will likely:
• can’t determine
7. AOL surprisingly announces the mega merger with media giant Time Warner,
signifying the growing power of Internet companies. Share prices of Yahoo! and
Earthlink will likely: Answer
• can’t determine
8. The co-chairman of Citigroup, John Reed, announces his retirement. The
successor, Sandy Weill, will become the sole CEO. Robert Rubin, former Secretary
of Treasury, will likely take over the top job in 2 years when Weill retires. Wall
Street experts think Reed’s retirement is a positive to the company. Share price of
Citigroup will likely: Answer
• can’t determine
9. President Clinton announced that U.S. and Britain agreed to openly share data
from a project to map human genes. Shares prices of the biotech stocks will likely:
• can’t determine
10. Yahoo! held talks with eBay about various forms of partnership and a possible
merger. Share price of eBay will likely: Answer
• can’t determine
11. Sears and America Online unveiled a wide-ranging strategic alliance that
includes cross-marketing and promotional agreements. Share price of Sears will
• can’t determine
12. The strike of Boeing’s engineering and technical workers has delayed some
testing and production of the F-22 fighter. Share price of Boeing will likely: Answer
• can’t determine
13. Intergraph's antitrust suit against Intel was dismissed. Share price of Intergraph
will likely: Answer
• can’t determine
Answers to “How Does News Influence Stock Prices?”
1. Share prices will likely decrease. If the Federal Reserve declares an increase in
interest rates, mortgage payments will increase. This increase will cause housing to
be less affordable, therefore hurting share prices of real estate companies.
2. Share prices will likely increase. Companies such as General Electric, IBM, and
3M will be more profitable as a result of higher productivity. The companies will
be able to make more while having a lower cost to produce the product.
3. Share prices will likely decrease. The airline companies will have to pay a higher
fuel cost. They will not be able to pass along the increased cost to consumers or
raise the cost because of the increase in fuel prices.
4. Share price will likely decrease. Because the judge declares a monopoly on
Microsoft, the government will likely put penalties on Microsoft. Also, hundreds of
private pending lawsuits are arising against Microsoft.
5. Share price will likely increase. AMD beat industry leader Intel for the fastest
microprocessor and will also take market shares away from Intel.
6. Share prices will likely increase. Because of increased shipments, companies will
have an increase in sales and, therefore, profits.
7. Share prices will likely increase. If Al Gore becomes the next president, he will
likely have policies favorable to Internet businesses.
8. Share price will likely decrease. Changes in share prices are greatly tied to
earnings. In addition to P & G’s reported poor earnings, Wall Street doesn’t like
downside surprise earnings.
9. Not enough information to determine. The announcement of the merger is too
early to determine whether it will have any impact on Internet companies like
Yahoo and Earthlink.
10. Share price will likely be unchanged. All three management are well-respected
industry leaders. The retirement of any one will not affect the operation of the
company because all are competent to take over the job without any problems.
11. Share prices will likely decrease. The private sector will be competing with the
huge amount of resources and research as a result of the government-funded labs.
12. Share price will likely increase. eBay will likely be the target that Yahoo will
13. Share price will likely increase. The alliance will likely cause an increase in
Sears’ sales because of the exposure on the Internet to the 22 million AOL users.
14. Share price will likely decrease. The strike will likely affect Boeing’s sales and
delivery of products to the government.
15. Share price will likely be unchanged. Intergraph will not be able to get
any compensation from Intel.
Stock Market Savvy
Yo u r F u t u r e
Information for Educators from
the New York Stock Exchange
The New York Stock Exchange, with the assistance of Lifetime
Learning Systems, a division of Weekly Reader, is proud to present
this free educational program, Stock Market Savvy: Investing for
Specifically designed for middle school and high school students,
this program includes eight reproducible activities that can be cus-
tomized to the needs of your class. The goal is to introduce your
students to the financial world of long-term savings and invest-
ment in stocks. Students will see that long-term savings through
investment in the securities market is integral to the economy and
their own personal lives.
This program will introduce students to the high-tech, exciting
nature of the NYSE and the skilled market professionals that use
state-of-the-art technology on the Trading Floor. They will also
understand that the NYSE maintains high standards of conduct
and integrity in the auction market to ensure fair trading in secu-
rities for all investors.
Stock Market Savvy: Investing for Your Future also helps
students discover how to make informed investment decisions and
understand why long-term savings through securities investment is
important as they prepare for their future goals and dreams.
Although the material is copyrighted, it can be reproduced for
teaching purposes. Please complete and return the enclosed Educator
Reply Card to receive future free educational programs and the
enclosed survey to provide feedback on this program.
Provide students with an understanding of the
world of securities investment and its importance
to their personal lives and private enterprise.
Introduce students to the high-tech, exciting
nature of the NYSE and the skilled market
professionals on the Trading Floor and in the
Teach students about the high standards of con-
duct and integrity at the NYSE that ensures fair Up Close and Personal
trading for all investors.
Explore how supply and demand affects stock
prices in the securities marketplace.
1 The Stock Market & You
Objective: This activity introduces students to the securities market, helps
Encourage teachers, students, and their families them make a personal connection to the New York Stock Exchange auction
to explore the opportunities for long-term
market, and understand how public companies affect their daily lives.
savings growth as active and informed investors.
Begin by asking students what they know about the stock market. Explain
Target Audience that Wall Street in lower Manhattan is home to the New York Stock Exchange.
This program is designed for middle school and high Encourage students to visit www.nyse.com to learn about the history of the
school students in social studies, business, econom- New York Stock Exchange.
ics, math, consumer skills, or other relevant classes. It Find out how many students or their families own stock. Explain that their
is helpful when teaching financial responsibility or families might participate indirectly in the stock market through retirement
for use in after-school stock or business clubs.
accounts or 401(k) plans at their jobs.
Explain that stock is a share of ownership in a business. Ask students
to provide examples of things that they own. Then, explain that stock owner-
This eight-page teacher’s guide, which contains
curricular objectives, background information, ship provides risks and rewards to investors.
instructions for using the student activity mas- Discuss why it is important to save. Have students consider things they want
ters, answers to the student exercises, and sug- to save for now (computer games, clothes, sports equipment, DVDs). Then
gested extension activities have them think about their future goals (college, car, house). Explain how
Eight reproducible student activity masters their need for savings will increase as their goals become more expensive.
Two different full-color wall posters for class- Discuss that even at a young age investing in stock can be part of long-term
room display financial planning that will lead to security and economic independence
A teacher survey later in life.
Distribute the activity sheet and have students work individually or in small
How to Use the Posters groups to complete it. They should use www.nyse.com, search the Internet, or
Please display both posters in your classroom. check newspapers to find out if any of the companies they wrote down are
Poster #1 (New York Stock Exchange): This poster NYSE-listed companies.
will familiarize students with the New York Stock Point out that some companies are harder to find because they are
Exchange and help them appreciate the role NYSE- subsidiaries of larger corporations, known as parent companies. An Internet
listed companies play in their daily lives and the econ- search will help students determine the parent company’s listed name.
omy. Owning stock in a company means owning a
piece of that business. Investments grow over time and After students complete the activity, compile a class list of NYSE-listed com-
this means young investors can create a great oppor- panies that manufacture or sell products and services associated with favorite
tunity for future earnings. student activities.
Poster #2 (How To Read Stock Tables): One way
to get a stock quote during the day is to look at the
electronic tape on the Internet (at websites like
www.nyse.com) or on television. These rolling Stock Talk
lists of stock symbols and prices are continuously
updated after each trade. For more information,
you can also read a stock listing. This poster shows
2 Market Terms
how to read NYSE stock listings in daily newspa- Objective: This activity introduces students to basic stock market
pers or on the Internet. It uses a newspaper stock terminology, familiarizes them with the special characteristics of the NYSE
listing to explain the various headings. Refer to auction market, and explains why a company issues stock.
this poster when your students begin Activity 3: Introduce this activity by explaining that the NYSE is an auction
“Understanding Stock Tables,” which presents the
market where buyers and sellers of securities meet and compete for
stock listing as it might appear on the Internet.
the best price for their customers. A trade takes place when the best
Remind students that the information is the same
bid meets the lowest offer to sell. Stock prices are determined by
whether they’re reading a stock listing in the
newspaper or online. supply and demand.
Conduct a mock class auction of different items (e.g., a CD, Extension Activity
movie tickets, a night of no homework, etc.) to see how much Have students brainstorm ideas for a business that they could
students are willing to pay for them. Explain that the NYSE is a live start and run (e.g., grass-cutting or pet-sitting business). Ask
auction. If they’ve used Internet auction sites, then they know that a students to list some of their business expenses (e.g., lawn
seller puts an item up for sale and several people compete to buy the mower, pet food, flyers to advertise, etc.). Then, discuss how a
item. The same thing happens with stocks as buyers and sellers com- business can raise the capital it needs: the students can invest
pete for the best possible price. their own money, borrow from the bank, issue bonds, or sell
Distribute the activity sheet, have students role-play the characters stock in the business to outside investors. Then, review what they
in the dialogue, and complete the activity. Review the answers will do with the profits (distribute among shareholders or save
as a class. some of the profit and reinvest it in the business).
1. Initial Public Offering 16. Dividend
2. Bull Market 17. Capital
3. Bear Market
3 Stock Tables
Generate a class discussion using terms and topics presented in the Objective: This activity focuses on how to read stock tables in a
activity. Explain that a company that wants to grow has several ways newspaper or on the Internet.
to raise funds and review the pros and cons of each method: Ask students to describe what it means to be an informed investor.
1. The company owners can use personal funds to expand the Recommend reading financial newspapers, magazines, and
business, but available funds will be limited and the business websites for investment information. Explain that stock market
expansion will be relatively short-term. activity is reported through a variety of indexes which measure the
state of the economy. When you hear “the market was up,” people
2. The company can borrow from a bank, but it can only
are referring to an index. One of the best known and most widely
borrow what it can prove it will be able to pay back at its
cited indicators is the Dow Jones Industrial Average which tracks
current level of business. It will have to repay the loan plus
the stock prices of 30 major “blue chip” companies.
interest almost immediately after it has received the funds.
Explain to students that being an informed investor also means
3. A company may issue bonds. A bond is an I.O.U. or loan from
understanding how to read stock tables. The traditional way to
investors. Investors lend a company money and after a certain
check stock tables is in the business section of newspapers. Today,
time the bond “matures” and the company then pays each
this information is also available in real-time format on the Internet.
investor the amount they invested plus interest. This option
Explain that the Internet has revolutionized how people retrieve
carries the burden of repayment with interest.
their stock information.
4. A company can raise funds by selling shares of ownership in
Refer your students to Poster #2: “How To Read Stock Tables”
itself, called stock, to the public. When a stock offering is
and review what the various headings mean. The poster shows
successful (many people buy the new stock), a company can
how stocks are read in newspapers and online, using a newspaper
obtain large amounts of capital and can use these funds imme-
stock listing to explain the various headings. On the activity sheet,
diately for expansion. Then, if profits increase, the stockhold-
students will be presented with a stock table as it might appear
ers will share in the company’s success by receiving dividend
online. If your students are interested in seeing examples of actual
payments. This option places no fixed limit on the amount of
online stock listings, have them log on to www.nyse.com.
funds a company might raise and no restrictions on the
opportunities for growth. Distribute the activity and review the answers as a class. This
activity can be customized to match the skills of your class.
Discuss reasons why a company might decide to go public (the
Create additional math questions to challenge the class.
process when a company offers shares of stock to the public for
the first time): raise capital, expand operations, fund research and Answers
development, pay off debt, provide employees with benefits, and 1. $10,528.00 4. $168.00
develop marketing strategies. Remind students that the purpose of 2. $104.95 5. $5,488.00
issuing stock is to raise funds that will help a company grow. This, 3. 3,976,700
in turn, creates more jobs, generates additional revenue,
contributes to the development of better products, and helps to pro- Extension Activity
mote general economic expansion. Have students look up an NYSE-listed company that interests them
on www.nyse.com and answer the same questions that they did in
Activity 3: “Understanding Stock Tables.”
Ready, Set, called e-BrokersSM to receive orders, improve the flow of infor-
4 Auction mation between customers and the point of sale, and manage
Explain that the high-definition post display units, the computer
Objective: This activity is designed to familiarize students with the
monitors above the trading posts, contain a variety of information
skilled market professionals who work on the Trading Floor and the
about the stocks that are sold there (stock symbol, last sale, net
advanced technology that delivers fast, efficient, and cost-effective
change, bid and offer, and volume).
trade executions. The NYSE is governed by a precise set of rules and
regulations and also uses technology to maintain continuous mar- Distribute the activity sheet and encourage students to visit
ket surveillance to ensure fair and efficient trading. www.nyse.com to learn more about the technology and to
experience an exciting 3-D view of the NYSE Trading Floor.
Introduce this activity by explaining what it means to have a seat
Review the answers as a class.
on the Exchange. There are 1,366 seats and they are not physical
seats, but membership that can be bought or leased. A seat is a Answers
property right that gives you the right to trade. Remind students 1. B 5. A
that NYSE-listed companies don’t own seats. Although individuals 2. F 6. D
can buy seats, they are primarily owned by brokerage houses and 3. E 7. H
investment firms. So if XYZ Brokerage House buys 20 seats, they 4. C 8. G
have 20 members.
Explain to students that securities are traded by highly skilled mar-
ket professionals who have qualified for membership in the NYSE. Anatomy of a
There are different types of membership in the NYSE and each one
serves a different purpose on the Trading Floor:
1. Floor brokers constitute the largest single membership group
of the NYSE. They receive their orders electronically on the Objective: This activity focuses on how a stock is traded at the
Trading Floor either at their trading booth location or on NYSE as students place the steps in chronological order.
mobile, wireless handheld computers. Explain to students that when they check the price of a stock, they’re
2. Specialists serve as the contact point between brokers with checking a quote. Like an auction, there are two prices: a bid and an
buy and sell orders in the NYSE’s agency-auction market. asked. If you want to buy a certain stock for $30, that’s your bid. The
Each NYSE-listed stock is allocated to a specialist, who person who owns the stock wants to sell it for the highest price pos-
trades only specific stocks at a designated location called a sible, say $30.02. This is the offer or asked. The difference between
trading post. The number of stocks traded by an individual the bid and asked price is called the spread.
specialist varies according to the total activity of the stocks. Explain that investors must indicate the type of order they want to
These professionals are responsible for overseeing the place when buying or selling stock. Some common types of orders
orderly trading of specific stocks to maintain the market’s include: A market order, which tells the broker to buy or sell at the
fairness, competitiveness, and efficiency. best price currently available, and a limit order, which tells the bro-
Ask students how technology has changed their lives. Explain that ker to buy or sell at a specific price or better. The broker will try and
the NYSE has evolved into the most technologically advanced get the best possible price for the customer, but can’t sell below or
equities market in the world. It uses technology to support and buy above the specified figure.
enhance human judgment, trading over 1.4 billion shares daily. Reemphasize the roles of the market professionals and their
Explain that over the last 211 years, the NYSE has used technology interaction with the NYSE technology. While a stockbroker (often
to improve service, increase trading, and maintain a fair trading another term for financial consultant) can make investment
environment. For example, in the decade following the Civil War, recommendations, and the NYSE technology speeds and
the stock ticker (invented by Thomas Edison) and telephones safeguards the transactions, the investor must take the ultimate
increased trading and opened Wall Street to investors across the responsibility for understanding his or her investments.
country. In 1975, the consolidated tape was introduced as a world- Distribute the activity sheet for the class to complete and then have
wide reporting system of price and volume data for trades in all students take turns going through the correct order.
markets in which the securities trade. Today, through a sophisticat-
ed electronic network called SuperDOT®, 95% of orders make their
3, 1, 4, 6, 5, 8, 7, 2
way to the specialists’ workstations on the Trading Floor. About 5%
of orders are walked out by brokers to the specialists (these are large,
institutional orders). As the NYSE evolves toward a paperless Extension Activity
Trading Floor, floor brokers are using wireless, handheld devices Invite a member of a local brokerage firm to talk to the class
about his or her job and finance as a career. Have students pre-
pare questions in advance of the visit.
1. With the orange crop supply reduced by the lack of rain, the
bottlers’ costs will rise as companies pay a premium for the
oranges they need. The companies will probably have to raise
prices for their products to offset increased expenses, but will
need to be careful that they don’t price orange juice so high
that they lose customers. Ask the students to discuss how
weather and natural disasters can affect the price of the foods
we eat, and in turn, the companies that provide that food.
2. Stock prices in battery companies will rise as battery-pow-
ered vehicles become more popular as a way of saving on
gas and reducing pollution. Have the students discuss what
gas companies might do to compete with growing interest
6 What Drives Stock
in battery-powered cars (Reduce pollutants in gasoline?
Cut gas prices?).
Prices 3. A big movie can generate a large, profitable merchandising
Objective: This activity explores how supply and demand tie-in chain reaction among toy, clothing, food, and many
drive stock market prices in the NYSE auction market. Students other manufacturers. And a flop can result in a similar chain
also discover how outside events and news can affect the reaction of losses for all those companies. Have the students
NYSE’s auction market. discuss the kinds of tie-ins that occur, and their short- and
long-term economic effects.
Introduce this lesson by asking students what influences stock
prices. Explain that different events can move a company’s price 4. Competition is a fact of life for any company. Unless Digital
up or down. Industry factors that drive stock prices include Dream can find a way to cut costs, it’s likely that it will lose
earnings or sales growth, new product releases, leadership customers to its competition, and will face dwindling profits.
changes, or legislation. Outside forces and world events like new The competition will be enjoying the profits of successful
competition, economic news such as interest rates and inflation, new products. Discuss with the students the need for com-
government policy changes, natural disasters, or weather can panies to invest some of their profits in research and devel-
also affect stock prices. opment to find new products and improve existing ones.
Remind students that the laws of supply and demand determine
stock prices in the securities markets. Provide examples that Extension Activity
they can relate to (old baseball cards, popular sneakers or fash- Have students review national and international news
ion trends, electronic toys, gasoline). To familiarize students headlines or news broadcasts to determine which types of indus-
with the concept, you can also talk about the effect of rumors or tries they might monitor for investment. Also, encourage stu-
speculation. Relate rumors to supply and demand and discuss dents to check interest rates and determine how they will affect
how they can affect market cycles. stock prices.
Then explain that the supply of stocks is based on the number of
shares a company has issued. The demand is created by people
wanting to buy those shares from investors who already own them.
If people think they will make more money on a stock, they will
want to buy it. But supply is limited, and not everyone who wants to
own a company’s stock can. The more that people desire to own a
7 Protection for All
stock, the more they will be willing to pay for it. Objective: This activity focuses on the integrity and self-regulation
Help students understand that an awareness of current events can of the NYSE, its zero tolerance for inappropriate conduct, and how
help them become educated investors. While investors and ana- this works to ensure fair trading for all investors. The NYSE places
lysts decide whether a stock is worth buying by examining the the highest importance on fairness and on earning and keeping the
financial health and profit history of a company, they also look at trust of its investors.
how news events can influence stock prices by their effect on sup- Distribute the activity sheet and have students review the pyramid
ply and demand. of regulatory agencies. The market protects and maintains itself
Distribute the activity sheet and have students work in small groups through the combined efforts of four groups that comprise the reg-
to analyze the impact of the news events. Review their answers as a ulatory pyramid:
class, drawing upon the suggested answers that follow. 1. The U.S. Congress forms the peak of the regulatory pyramid.
Congress created the SEC and other organizations to protect
and enforce fair trade on U.S. securities markets.
What is the Stock Market Pretest?
1. What is a stock?
2. How do you buy and sell stocks?
3. What are the benefits of buying stocks?
4. What are the disadvantages of buying stocks?
5. How do you know what stocks to pick?
6.What math does a stockbroker need to know to work in the
__________________—A declining market
____________—The price offered by a willing buyer
___________—A rising market
___________—A firm or individual who arranges a transfer of
securities between a buyer and a seller, charging a fee for the
_____________________________—Profit or loss from the sale
of a capital asset.
________________—Payment a company makes, in cash or stock,
to its shareholders.
_________________—A period during which the purchasing
power of the dollar is declining.
_______________—Payment to a creditor by a borrower for the
use of money.
_________________—The price at which transactions in a
security take place.
__________________—Typically consist of a group of stocks,
bonds, or money-market securities from more than one source.
There are three types—income funds )for people who need money
to live on); growth funds (pay low dividends or one—works best
for investors who can leave money in the fund so it can grow over
a long period of time; and balanced funds (combination of stocks
____________________________—The largest auction market
securities in the nation.
_________________—All of the securities held by an individual,
investment club or institution.
_____________—Same as earnings or income.
_________________—Synonymous with sales and receipts
____________________—Synonymous with stockholder or
shareowner, the owner of one or more shares of a corporation.
______________—Businesses need money to grow. To get this
money, some businesses sell shares, units of ownership of their
_____________________—The issuance of a number of shares
for each share of stock outstanding. The common purpose of a
split is to broaden ownership and increase marketability.
Vocabulary from Starting and running a Profitable Investment
Club by Thomas E. O”Hara and Kenneth S. Janke, Random
Campus Life, March/April 2001
Whose Money Is It, Anyway?
How you handle your cash says a lot about what you value the most.
by Larry Burkett
We've all heard the basics about how to handle money: give some to church, save
some, spend wisely, avoid debt, follow a budget, and so on.
It's all part of "stewardship," a fancy word that means so much more than whether
or not we put a certain amount into the offering plate on Sunday mornings.
What does "stewardship" really mean? Larry Burkett, who's long taught
Christians how to better handle their money, has been answering that question for
years. Stewardship is more about our attitude than anything else.
Here's how Larry explains it in one of his books:
Most of us have an upside-down view of money. We figure the
money we have is ours; God's money is just the portion we put
in the collection basket.
But God has a different view. As Lord and King, he owns
everything—including the money we call our own. He has clear
ideas of what he wants us to do with his money. We need to
manage money according to God's plan.
I've come up with five steps to help you do this:
Step 1: Give It All to God
God has placed the toughest step of all right at the front. Once
you accomplish this step—admitting that he owns everything—all
the others will fall into place. Here's why.
God expects us, as Christians, to transfer ownership of every
possession to him—money, time, parents, brothers, sisters,
girlfriends, boyfriends, education, and things like cars, clothes,
and other possessions.
Did I leave anything out? If I did, add it to your list. God expects
it all. In fact, if you believe you own anything, that will affect your
It's important that you gain the proper understanding of
stewardship. By Webster's definition, a steward is "one who
manages another's property." We are merely stewards of God's
property while we're here on Earth. God will not force his will on
us. If we transfer everything to God, he will keep his promise to
meet every need we have through physical, material and spiritual
There is absolutely no substitute for this first step.
Step 2: Don't Overspend
First, you need to have a written plan of all the stuff you're thinking
about buying, in order of importance. Determine whether each
thing is a need, a want or a desire.
Needs are obvious—things like food and clothing. Wants can also
appear awfully important. You may need a new pair of jeans, but
does it have to be the most expensive kind? That's the difference
in a need and a want.
Desires are tougher to define. They don't exactly seem like
needs, but they could—if you rationalize them. Maybe the old
clunker you're driving works fine, but if you got a new car, you
wouldn't have to worry about it breaking down.
There's nothing wrong with desiring nice stuff. But if it
rearranges your priorities, takes your attention from what's
important, and gets you into debt, you're in trouble.
Second, open a savings account and put something into it every
week or every month, regardless of how much. The amount isn't
nearly as important as the act of doing it.
Step 3: Tithe Regularly
Every Christian should tithe as a minimum testimony to God's
ownership. God wants you to give back to him the first part of
what he has given you: "Honor the Lord with your wealth, with
the firstfruits of all your crops" (Proverbs 3:9).
2. What is a brokerage house?
3. What is the procedure when you choose to buy a stock?
1. What is a mutual fund?
1. What is the Securities Exchange Commission (SEC)?
1. What is a stock "crash?"
1. List five reasons why the stock market goes up and down?
What is a Stock?:
1. What is a stock?
Yahoo! Finance Activity
Name _____________________________ Date __________________
Use finance.yahoo.com to find the answers.
Symbol Look Up
Type in the name of the company. Write their stock market symbols on the line following
the company name.
Coca-Cola ___________ Home Depot _______________
Hershey ____________ Walt Disney Co. _______________
Nike ____________ Apple Computers _______________
Quotes & Info
Type in the symbol SLR. Answer the questions below from the information given on the
Quotes and Info page.
What is the current “Last Trade”? ________________
What does that mean? ________________________________________________
What was yesterday’s close? ___________________________________________
Has the price gone up or down today? _______________
By how much? ____________
What is the most this stock has sold for in the past year? ______________
What is the least it has sold for? _______________
More on SLR (sidebar links)
What was the closing price on July 14? ____________
What was the opening price on March 10? _________
Based on what you have seen, what do you predict the price will be in 1 month?
What are three things that have happened to Solectron in the past month?
How many employees does Solectron have? _________
What does Solectron do? (business summary)
Click on “ratio comparisons.” What is Solectron’s BETA? _______
Is this a risky investment? __________
List three competitors of Solectron.
Finances: Income Statement
What was Solectron’s Net Income as of August 31, 2003? _________________
Research a Company
Write a one-page biography of a company that Mr. Ezell will assign you. You will give
your report orally to the class next week Friday (Date). You will hand in a hard copy of
the report to Mr. Ezell.
You will need to include the following information in your report:
What do they do?
History of the company
Summary of their income statement/balance sheet from the past year
Would you recommend buying this stock? Why or why not?
STOCK OWNERSHIP: A DELICIOUS TOPIC
Name________________________ Date ________________________
Toad is Maria's best friend, but sometimes his impractical schemes are a bit much,
even for Maria. Yesterday was a good example. He embarrassed her at McDonald's just
because he was ignorant about stock ownership and insects.
Stock ownership and insects? Yes. It all started when Toad stopped by Maria's house
and asked her to go to lunch at McDonald's. "Nothing like fries and a burger and
something special for lunch," he said, as they walked over ot the local Golden Arches.
"Something special?" she asked. But he just ignored her as he hopped along, carrying
a carefully folded brown bag.
At the restaurant, Toad offered to buy lunch. He asked maria to find a table and to
guard his brown bag. "Don't look inside, it's a surprise," he said. That should have been
enough warning, Toad buying lunch and asking her to guard a brown bag; but she just
went along with everything because he brain was temporarily locked in the numb
Shortly he joined her at the table with the food and a sour mood. "What is the
matter?" she asked. "Didn't they give you good service?"
"Oh, yes," Toad grumped, "but apart from the service she was so uncooperative! I
said I wanted to see the owner about this great idea of mine, but she said she was the
local franchise owner. I said, 'so you own all the McDonald's in the world?' And she
said, "No, it is impossible to talk to those owners.' Then she started waiting on the next
customers. She's so rude!" Toad moaned.
"Actually," Maria replied, "she is right. There are 226,656 owners of McDonald's.
Maybe you should become an owner."
"That's a great idea," Toad replied. "Then I could have the restaurants serve my
favorite foods and I could eat free. If I own the business, then I get to run it my way,
"Not exactly," Maria replied. "I learned a lot about ownership and business by surfing
the Internet. If you want to become a part owner of McDonald's, all you have to do is
buy stock in that company. You become a part owner of the company, but many other
people will also have bought stock in the company. So you are only one of many people
who share its ownership. That's why stocks are called shared."
"But I could only eat a tiny share of all the food McDonald's cooks each day," said
Toad. "As a part owner, couldn't I eat part of their food?"
"No, you couldn't. McDonald's has close to 694 million shares of stock. That means
that the ownership of every hamburger McDonald's produces is really divided into 694
million parts. If you buy one share of stock then you would own one of 694 million parts
of each hamburger."
"That's hard to imagine," said Toad. "That little bit wouldn't fill me up."
"And the same would be true for the company's buildings, stoves, and furniture. You
would own only one 1/694 millionth of each thing."
"Well, maybe I could decide what food to put on the menu if I were an owner of
McDonald's stock," Toad said. "They are really missing a sure bet by not offering a more
"Actually, you can't do that either," Maria replied. "For each share of stock, you get
one vote for the company's top managers, or directors. With so many owners or
stockholders, you by yourself would not have a big influence on what the company offers
as its menu. Actually, managers run the company for you and the other stockholders."
"So what would I get for buying a share of stock in the company?" asked Toad. "It
doesn't sound like much of a deal to me."
"Each share of ownership entitles you to some of the profits the company earns," she
explained. "But profit is not a sure thing. If people don't like the food, the company
wouldn't earn enough money to cover the costs and earn a profit. Any business is risky
because the future is uncertain. A company could spend lots of money for buildings,
equipment, or developing a new product. But if customers don't like the product or if
prices are too high or products of other restaurants are more attractive, business income
will be too low. Success is never a sure thing, so there is always a chance of loosing your
money. Any business is risky and someone has to bear that risk. That's what
stockholders do as owners of a business."
"Sounds exciting," said Toad. "So why buy a stock and risk losing money?"
"Because you can make a gain also. You think the business will earn a profit on the
product, so you take the risk. The possibility of earning a profit gives the owners and
managers of a business an incentive to produce something consumers want to buy at a
price they are willing to pay. If the business succeeds, its owners will earn a profit. That
is the reward stockholders get for risking their money. Customers also benefit because
they get something they like. Employees of the business benefit because they have a
place to work and earn income. It's like they're all on one big team with the same goal.
But owners are the only ones who risk their own money on whether the goal is
"So by buying a stock," Toad said, "I become a business owner who takes part of the
risk that the company might fail. But if the company succeeds, I may get some of the