Investing doesn’t just have to be for grown ups. It can actually be pretty fun for kids, too. They just need to know how to invest and to understand the basics of the stock market.
That’s not to say that we’d encourage you to empty your savings account and buy shares in Apple (NASDAQ: AAPL) or anything, but if you get a head start on learning the market game, you’ll be more ready to make informed investments when it is time.
Stock market worksheets are one of the ways that you can familiarize yourself with trading. They’re easy to use, and you can learn a lot from them. Here are just a few of the things you can learn with stock market worksheets.
Learn How Stocks Work
Stock market worksheets are useful only if you know what stocks are. You’ve heard of the stock market, and about people who have made a lot of money by buying and selling stocks? But what is a stock, exactly? When you buy a stock, you buy a share in a company. That share allows you to vote in shareholder meetings, sell your shares, and earn money from the company. Owning stock doesn’t mean that you own a part of the company. You can’t make decisions on behalf of the company, and you don’t own any of the company’s things.
But if the company does well and makes a profit, you can make money, too. Companies pay out something called dividends to shareholders. Dividends are when a company pays out a portion of its earnings to investors. You might receive this money just every now and then, or it may be a quarterly or annual payment. The dividends themselves aren’t usually a huge amount of money – maybe $.50 or so each year. But when they’re part of a bigger portfolio, you can make a bit of money.
Stock market worksheets will give you a better idea of what stocks are by allowing you to play around with them. You’ll be able to choose stocks, track them, determine how much money they’d earn you and learn when to buy or sell.
How to Build a Stock Portfolio
Stock market worksheets can help you learn how to build a portfolio. So wait, what’s a portfolio? A portfolio is a collection of everything you own, from stocks and bonds to mutual funds and ETFs. Stocks just make up a small part of your portfolio, but they’re a very important part. There are some parts of a portfolio, like bonds, which won’t increase or decrease in market value too much over time. But stocks will! And that’s why it’s important to know how to choose stocks. Stock market worksheets will help you learn how to decide when to buy shares in a company, sell shares or hold on to them.
There are stock market worksheets which will allow you to choose a few stocks and track their value over a few days or weeks. You can easily find stock prices by typing the ticker symbol into a Google search. For example, to find the stock price of Twitter, you’d just put “TWTR” into your Google search. If you don’t know the symbol, you can type something like “buy shares in Twitter.”
Usually, once you hit search, a graph will pop up on your results page, telling you the current price of the stock and what all the prices have been over the course of today, or a longer period of time. Using a stock market worksheet can help you determine how good you are at using the news, a stock’s history or industry reports to guess whether a stock price will rise or fall.
Understanding Wall Street Vocabulary
It can be confusing to hear people talking about the stock market. Bull markets, bear markets, ROI, dividend yield, market cap, OTC… good grief it can be overwhelming. Stock market worksheets are a very good way to learn the terminology, and then learn how to apply it. Say, for example, that you have no idea what a dividend yield is. Well, it’s actually pretty simple. It’s how much a company pays annually relative to the price of a stock.
Okay, maybe that didn’t clarify it for you. That’s why you need stock market worksheets. You can recite the definition all day long, but until you understand how a dividend yield is calculated, it won’t make sense. On stock market worksheets, you’ll probably have a few examples, broken down into a simple equation: dividend yield = dividend per share / share price. That’s it!
Calculations are just one way of using stock market worksheets to learn vocab though. Some classroom teachers play a vocabulary bingo game – she’ll call out a term, and if a student can correctly define the term, they check off that space on their worksheet. There are other ways you can play, too. The point is, stock market worksheets can make learning about stocks fun.
Beyond Stock Market Worksheets
If you’re lucky enough to have computers in your classroom, there are a ton of ways that you can use what you’ve learned with stock market worksheets. There are dozens of games that you and your classmates or your friends can play – they simulate the stock market, using stock quotes that are current as you play them.
HowTheMarketWorks is one; they offer you a chance to set up your own game and compete against your buddies to see who makes the most money trading stocks. Wall Street Survivor is another. Your teacher can set up a contest between class groups or individual traders – maybe she’ll even offer a prize to the winner. No homework for a week? It’s worth a shot.
If you don’t want to compete against your friends, there are stock market simulations that you can do on your own, too. You’ve mastered the vocabulary and math with your stock market worksheets – try an app like the one on Investopedia to set up your own portfolio using fake money, and see how much you can earn if you buy shares in your favorite companies.
Even if you’re not learning about finance or the stock market in school, stock market worksheets are a great way to brush up on the knowledge you’ll need now to become a good investor later. You’ll learn the basics as well as terminology, and you’ll learn how to use formulas commonly used by investors. Before you know it, you could find yourself giving your adult friends advice on how to play the market.
