Students learn value of investing in the stock market, lifelong financial literacy skills

For too many adults, investing and the stock market is a mystery.

But not to Cordell Brown and his classmates at St. Catherine-St. Lucy School in Oak Park. They spent several months this past school year tracking stocks in an annual competition that ended with Cordell and the rest of his 8^th grader class placing third out of 64 Chicago area teams.

It was a sweet victory for the St. Catherine-St. Lucy team, which halfway through the year ranked in the mid-50s. They came back from Christmas break determined to improve their standing in the Big Shoulders Fund program, which provides support to Catholic schools in Chicago’s neediest neighborhoods.

In a few weeks, another round of 8th graders at Catholic schools across the Chicago area will begin a new competition, now entering its 13th year — and start learning basic concepts about saving and investing, how the stock market works, and careers in the financial and business sectors.

One of the lessons many of the teams learn, sometimes the hard way: the importance of switching up their portfolio.

That’s what happened with the St. Catherine-St. Lucy team.

“We felt we could do way better than we were doing. So we came together and discussed what stocks we had to drop,” Cordell said. That change to their portfolio made all the difference; the team’s ranking jumped to 12^th, before finally landing in third place when the competition ended May 29th.

“They were very willing and interested … They knew what they were talking about,” said Arnette Young, St. Catherine–St. Lucy’s eighth grade teacher who’s been involved with the stock market program for four years and is looking forward to another 8th grade class participating.

Playing a key role was Paul Goodworth of Goodworth Wealth Management, one of approximately 150 business people who served as volunteers coaches to about 1,000 students, teaching them how to evaluate a stock, when to buy or sell, and the importance of doing research and managing risk.

At the start of the nine-month program, Goodworth gave the students a list of about 60 stocks and the program provided $3,000 to invest. After much research and discussion, the students decided to buy stock in Amazon, Netflix and Google.

As they debated which stocks should be in their portfolio, Goodworth encouraged the students to think about the products they use every day – they mattress they sleep on, the toothbrush they use, what they watch on their cell phones.

“Those are discussions which are really priceless,” he said.

Mid-year, they rebalanced their portfolio after more discussion and research, including looking at what the top-performing schools in the competition had invested in. That’s when the St. Catherine-St. Lucy team purchased BioMarin Pharma and Trex, Goodworth said.

By the end of May when the competition ended, their portfolio had a valuation of $3,606.23 — well above the S&P 500’s value of $2,722.20, Goodworth said. In all, 56 of the 64 schools beat the S&P 500.

When the COVI9-19 pandemic hit, coaches and students had to quickly adapt, moving their classroom meetings to Zoom. The previous year, the students participated in an end-of-the-year presentation at Goodman Theatre, then went to Goodworth’s downtown office for pizza. Instead, the celebration had to happen virtually.

Despite the coronavirus challenge, students learned invaluable skills and hopefully are now considering careers in the financial industry, says Joshua D. Hale, president and CEO of Big Shoulders Fund.

The program provides students with “a greatly needed skill: financial literacy for life” — and it can stoke an interest in careers in accounting, finance and banking, Hale said.

“There’s such an under-representation of minority members in any financial firm or bank. … Anything we can do to change that, we will,” Hale said.

Learning the value of investing, the value of compound saving and that everything has a cost can make all the difference in a teen’s life, now and as they grow older, he said.

“We want them to be an informed buyer, saver and investor.”

That’s a lesson Arianna Pumphrey, a recent St. Genevieve Catholic School graduate, learned.

Arianna said she used to spend money freely, but after completing the stock market program, she understands the value of saving.

“I was very careless when it came to spending money,” said the Belmont-Cragin resident who will be attending Alcott College Prep this fall. She wants to be a mechanical engineer.

“This class really helped me,” said the teen, adding she recently opened a savings account — something she would not have done before participating in the stock market program.

Her eighth grade class at St. Genevieve won this year’s competition with a portfolio of Coca-Cola, Microsoft, Sony and Tesla.

“We invested in really good stocks,” she said.

When the next round of eighth graders across Chicago begin picking their stocks. Cordell Brown advises each group to work as a team if they want to be successful.

“It’s all about communication, it’s all about coming together and discussing what stock you want to invest in,” said Cordell, who’s a freshman at Christ the King Jesuit College Prep and wants to become an entrepreneur. “Why do you think it’s a smart investment? Your research on the stock is very important, and if you do it as a class … it’s actually pretty easy.”