Academy Curricular Exchange
Columbia Education Center
Social Studies

TITLE:  PERSONAL INVESTMENTS

AUTHOR:  Dr. Robert B. Weiss, Juneau-Douglas High
         School; Juneau, Alaska

GRADE LEVEL:  Grades 11 & 12

OVERVIEW:  Students and most adults have very little
working knowledge how best to invest their money or the
vocabulary of investments.

PURPOSE:  To teach students about personal investments
in general.

OBJECTIVE(s):  To familiarize students with:
*  the vocabulary of investment
*  the types of investment
*  the different types of income earned by the
   different investments
*  the difference between realized (cash) returns
   and paper profits

MATERIALS:
*  Current Stock Market Report from a Daily
   Newspaper
*  Poster of the Alaska Permanent Fund's Prudent
   Investment Rule
*  15 largest Holding in the Permanent Fund Stock
   Portfolio
*  Permanent Fund Rates of Return
*  Glossary of Investment Terms

ACTIVITIES AND PROCEDURES:
1.   Tell the class that each student has inherited
     $50,000.
2.   Each student must write what their finance
     objective is. (College, marriage, children, future
     business, wealth, retirement)
3.   Divide the class in groups of 3 or 4 with similar
     objectives and ask them to come up with a
     portfolio of investments to reach their goal.
4.   Ask students to define the following terms:
     Investment, Security, capital, Asset, Stock, bond,
     and Real Estate.
5.   Ask students which of the investments they think
     is most risky.
6.   Tell the students, in order to reduce the risk of
     investments, it is necessary to diversity. Explain
     the Prudent Investment Rule.
7.   Explain to the students that there is a direct
     correlation between risk and return. The higher
     the risk the higher the rate of return. Define the
     terms:
     Return, Rate of Return, and Real rate of Return.
8.   Have students report on the cost value versus the
     market value. Which stocks gained the most? Which
     stocks lost the most? Explain that these are just
     "paper profits/paper losses" and would not be
     considered real gains or losses until they are
     sold. Define the terms:
     Paper Profit, Unrealized Gains, Income Stock,
     Growth Stock, and Blue Chip Stock.
9.   Have the groups redo their portfolio with balanced
     investments. Ask for a student from each group to
     present their portfolio to the class.

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