INVESTMENTS

WHY WOULD YOU INVEST MONEY?

+ The goal is to get a return (profit earned by an investor.)

SCHOOLHOUSE ROCK VIDEO

+ http://www.youtube.com/watch?v=foaYpoH0Fnk

WHAT ARE SOME DIFFERENT TYPES OF INVESTMENTS?

+ Savings+ Stocks+ Bonds

Company bonds Government bonds

SAVINGS

+ Savings and checking accounts- Institutions accept people’s money and them loan it out to people.

+ Important vocabulary– Principle- initial amount deposited– Interest- Payment received when loaning money

STOCKS

+ Stocks are buying partial ownership of a company and if the company does well, the value of your stock does up.

+ Analogy- A stock is like a block in this castle. The bigger it is the more valuable it is.

BOND

+ A bond is lending money to a company

+ Like James Bond movies there is almost always a return

COMPANY BOND

+ Companies use them to buy new equipment, research, and promise to pay bondholders interest.

GOVERNMENT BONDS

+ These are when you borrow money to the government.

+ Considered one of the safest of all investments.

+ One example was War bonds which were purchased during World War 2 and other wars to help fund the military.

INVESTMENT ACTIVITY

+ During this activity you are going to act as the Investor.

+ You start with $1000+ There will be seven rounds+ You are trying to maximize your return

STEPS EACH ROUND

+ Step 1: Calculate the value of everything you own

+ Step 2: Sell what you wish to and add the value of the sales to your additional wealth.

+ Step 3: Use your additional wealth to purchase any new additional investments which you want. (You must pay the current amount the investment is worth in this game round.)

+ Remember to record you calculations

ROUND 1

+ Make initial purchasesBond name Current Value

GPC 125 per share

HVS 250 per share

CCL 200 per share

FA 175 per share

CDC 225 per share

GGP 50 per share

NAP 100 per share

AHU 150 per share

ZPE 75 per share

MC 100 per share

OA 100 per share

GB 100 per share

ACTIVITY REVIEW+ Example:+ Round 1:+ Total wealth: 1000__+ New purchases: Quantity (How Many): Costs:+ _________GPC______ _____2_____ __250____+ __________________ ___________ _________+ __________________ ___________ _________+ __________________ ___________ _________+ Extra Money: __750____+ + Round 2:+ Total Wealth: __1030_+ Sales:+ ____1 GPC____ 750=140= 890 Extra money Sale value: __140___+ ______________ Sale value: ________+ ______________ Sale value: ________+ ______________ Sale value: ________+ New purchases:+ _____2 GB_____ 890-210= 680 Extra Money Purchase Cost: ___210__+ ______________ Purchase Cost: ________+ ______________ Purchase Cost: ________+ ______________ Purchase Cost: ________+ Extra Money: ___680____

ROUND 2+ Next round News: Big movie expected

Bond name Current Value

GPC ↑140 per share

HVS ↑300 per share

CCL ↑220 per share

FA ↑195 per share

CDC ↑230 per share

GGP ↑70 per share

NAP ↑110 per share

AHU ↑155 per share

ZPE ↑125 per share

MC ↑110 per share

OA ↑110 per share

GB ↑105 per share

ROUND 3

+ Next Round news: Hurricane season comingBond name Current Value

GPC ↓135 per share

HVS ↑500 per share

CCL ↑235 per share

FA ↑205 per share

CDC ↑235 per share

GGP ↑80 per share

NAP ↑125 per share

AHU ↓135 per share

ZPE ↑145 per share

MC ↑115 per share

OA 110 per share

GB ↑110 per share

ROUND 3

+ Next round news: Chicken found to be healthyBond name Current Value

GPC ↑145 per share

HVS ↓490 per share

CCL ↓155 per share

FA ↑210 per share

CDC ↑245 per share

GGP 80 per share

NAP ↓115 per share

AHU ↑145 per share

ZPE ↓55 per share

MC ↓110 per share

OA ↑115 per share

GB 110 per share

ROUND 4+ Next round news: Raising interest in Zoo Zoo Phone

Bond name Current Value

GPC ↑165 per share

HVS ↑495 per share

CCL ↑195 per share

FA ↓200 per share

CDC ↑255 per share

GGP ↑90 per share

NAP ↓110 per share

AHU ↑160 per share

ZPE ↑65 per share

MC ↑115 per share

OA ↑120 per share

GB ↑115 per share

ROUND 5

+ Next Round News: Recession predictedBond name Current Value

GPC ↑180 per share

HVS ↓395 per share

CCL 195 per share

FA ↑215 per share

CDC ↑265 per share

GGP ↓80 per share

NAP ↑135 per share

AHU ↑170 per share

ZPE ↑145 per share

MC 115 per share

OA ↑125 per share

GB 115 per share

ROUND 6+ Next Round News: More stable recovery

Bond name Current Value

GPC ↓150per share

HVS ↓205 per share

CCL ↓175 per share

FA ↓195 per share

CDC ↓235 per share

GGP ↑85 per share

NAP ↓120 per share

AHU ↑175 per share

ZPE ↓95 per share

MC ↓110 per share

OA ↓120 per share

GB ↑125 per share

ROUND 7

+ Remember to calculate your final wealth

Bond name Current Value

GPC ↓145 per share

HVS ↑245 per share

CCL ↑195 per share

FA ↑205 per share

CDC ↑240 per share

GGP 85 per share

NAP ↑135 per share

AHU ↑180 per share

ZPE ↓85 per share

MC ↑125 per share

OA ↑135 per share

GB ↑130 per share

REFLECTION

+ Take some time to finish the reflection on page 6 using the information you learned during the activity