New York, NY, June 21, 2023 – “Great things in business are never done by one person; they’re done by a team,” Apple Founder Steve Jobs said. Ada Li couldn’t agree more. Now in 5th grade at John Philip Sousa Elementary School in Port Washington, NY, Li understands how teamwork can translate into building a diversified portfolio geared for long-term financial success. Li’s approach led to an extraordinary achievement in the SIFMA Foundation’s Spring InvestWrite competition.
Li competed among thousands of other students around the country to write the best essay about long-term investing and the capital markets in the elementary school division. Li and her teacher, Jeanne Zeh, were honored by the SIFMA Foundation during a classroom presentation on June 21, 2023.
SIFMA Foundation’s InvestWrite national essay competition bridges classroom learning in math, social studies, and language arts with the practical research and knowledge required for saving, investing and long-term planning. It also serves as a culminating activity for The Stock Market Game™, a curriculum-based financial education program that challenges students to manage a hypothetical $100,000 online portfolio of stocks, bonds, mutual funds and cash over a semester or school year.
SIFMA Foundation’s programs are proven to increase participants’ test scores in math and economics, encourage students to think more about budgeting and financial planning, enable them to work in teams to build their interpersonal social-emotional learning and better prepare them for college and careers. The SIFMA Foundation is committed to closing the opportunity gap by fostering greater knowledge of the financial markets for young people of all backgrounds, with a focus on underserved youth.
“I am delighted to congratulate Ada, her teacher and their school,” said Melanie Mortimer, President of the SIFMA Foundation. “The research is clear that social and emotional learning is a critical component to students’ motivation, achievement and wellbeing. By participating in the Stock Market Game and InvestWrite, Ada has learned how working with a team can offer insights and increase confidence to make informed financial life decisions and achieve better life outcomes.”
Li understands the benefits of teamwork: “Things that could contribute to being a ‘good’ team when it comes to an investment portfolio are diversification. For example, having a good balance between low and high-risk companies would be very beneficial. Another form of diversification is finding a good, stable balance between stocks, bonds, and mutual funds.”
The Spring 2023 InvestWrite competition presented the following challenge to 4th-12th graders –
“What are some benefits of working on a team versus on your own? Give examples from your Stock Market Game team or other examples of teamwork. Teaming up investments in a diversified portfolio also has benefits. If you could invest $10,000 now for a long-term goal, what team of investments, including stocks, bonds and/or mutual funds, would you choose and why?”
Li impressed the panel of thousands of expert judges from across the financial services industry with a thoughtful and insightful essay.
Winning Essay by Ada Li …
Teamwork Makes the Dreamwork
Teamwork is when several people work on something together. When it comes to investing in the stock market, teamwork could be a very crucial part of success. Cooperation is also a very important part of .
teamwork so being nice and helpful is always a great way to get along with the rest of your team.
There are many benefits to working on a team compared to working on your own. Some of these benefits include being able to complete multiple tasks at once. Having more than one person working on something means that everybody involved can be assigned a different task. This could speed up the process by a large amount. On the contrary, working alone can influence how long the assignment gets completed by quite a bit since you can only get one thing done at a time. Organizing the jobs properly could affect the team’s performance tremendously. This is a huge factor because if math was someone's weakness and you tasked that person with calculating large sums of money then that would bring the entire team down. However, giving another person whose strength is math the same task would make it much easier to finish.
In my experience with the Stock Market Game, one of my teammates and I would browse for new stocks, bonds, and mutual funds to invest in while my other teammate calculated how much money it would cost to invest in a certain amount of shares for those investments. We all had different preferences for what we were looking to invest in. One of my teammates and I liked to look for smaller companies with potential to grow. My other teammate preferred to go for already big and established companies. Some other examples of teamwork could be as simple as helping your teammates if they are struggling with their assigned mission. Helping others is a very important factor since if one person on a team is falling behind, eventually the whole team will.
Things that could contribute to being a “good” team when it comes to an investment portfolio are diversification. For example, having a good balance between low and high-risk companies would be very beneficial. Another form of diversification is finding a good, stable balance between stocks, bonds, and mutual funds. If you do all of these things you will have a very well planned out and diversified portfolio. This is because if you invest in all high risk stocks such as Tesla Inc. (TSLA) with a beta of 2.07 and Bed Bath & Beyond (BBBY) with a beta of 1.64 then there is a very high chance of losing your money, while on the other hand, if you invest in only low risk stocks such as the 3M Company (MMM) with a beta of 0.96 and The Hershey Company (HSY) with a beta of 0.31 then you’re less likely to get as much money as if you also invested in higher risk stocks.
Another form of diversification in the stock market is not investing all your money in one industry. The reason for this is that if one industry begins to crash then you will have others to support you. An example of this would be if news came out about candy companies that involved chocolate such as The Hershey Company (HSY) that their supply of cacao beans was being imported from factories that don’t treat their workers well then it is very likely that tons of people will sell their stocks for that company. This is why maintaining a proper balance with your investments is very important in the stock market.
If I had $10,000, I would use it to save up for college by investing in stocks and opening a savings account. I would like to invest mostly in lower risk companies because it is much safer. I will try to invest around 48% ($4,800) in companies with a beta of about 1 or lower and put 50% ($5,000) into a savings account. That leaves 2% ($200) which I will invest in higher risk companies. I think this is a good team of investments for me because I don’t want to risk much since this money would be going towards my college funds. I hope these investments will help me reach my goal of going to college.
In conclusion, understanding different levels of risk is a very important part of investing in the stock market and helps you put together a great investment team just like working with a team of real people with their respective strengths and weaknesses.
About the SIFMA Foundation
The SIFMA Foundation is committed to closing the opportunity gap by fostering greater knowledge of the financial markets for young people of all backgrounds. Drawing on the support and expertise of educators and the financial industry, the Foundation provides financial education to strengthen economic opportunity across communities and increase awareness of the benefits of the global marketplace. Since 1977, the Foundation’s most notable program, The Stock Market Game, has guided more than 22 million students on their path to financial independence by attaining stronger life skills, improving academic achievement, and boosting their social-emotional learning. For more information on the SIFMA Foundation, visit www.sifma.org/foundation.
About InvestWrite®
InvestWrite® is a culminating activity for Stock Market Game students extending their classroom learning with a written challenge to address real-world financial issues and situations. Students must analyze, think critically and problem solve about a long-term saving and investing scenario. More than 260,000 student essays have been evaluated by their teachers and over 40,000 financial professionals have served as volunteer judges. Essays are judged by financial professionals who volunteer their time each year to ensure young people are exposed to the essentials of personal finance early in life. Judges evaluate students’ understanding of long-term investing, diversification, the global capital markets, and factors that drive investments as well as their expression of investment ideas in essay form. Winners locally and nationally rise to the top to earn exciting awards including laptops, classroom pizza parties, trophies, plaques and banners, and certificates.
For more information about InvestWrite®, visit www.investwrite.org.
