By EVAN NEMEROFF
Lauren Marcus, Dennis Goldbin, Zach Stein and Zack Fine, all seniors at Hewlett High School, are four of the 150 students who are members of the school’s Stock Market Club, which is competing in Newsday’s Stock Market Game this fall. The competition began on Oct. 8 and runs through mid-December, with 10-person teams competing to see who can make the most money.
Last year, a team from Hewlett High won the contest, but participants this semester are facing a drastically different challenge. “It’s a lot harder to read what’s going to happen in today’s economy,” Goldbin said. “In the past you could look at trends. Right now it’s not really based on that. It’s harder to pick a stock and expect it to go up or down.”
Bringing back-to-back titles to Hewlett would be a boastworthy accomplishment, but most of the participants are taking part in the contest for the fun and camaraderie. “There’s no pressure on us,” Marcus said. “We all enjoy the club, and it’s fun because we get to pick our own teams and work with people who we can do well with. Some people, though, do take it more seriously than others.”
The teams competing in the Stock Market Game are allotted $100,000 in conceptual money to invest in the stock market, and they can request as much as an additional $100,000. They can not own more than 3,000 shares of a single stock; they must invest in at least 100 shares of any stock for at least $5 a share; and they can’t own more than 3,000 shares of a stock, but teams must own three different stocks. Students research companies to find those that will make their investments grow.
Barbara Mattes, chair of the Hewlett business department, said she is encouraged by the enthusiasm that students are showing for the game and their understanding of the economy. “With the economy the way it is right now, the students are asking good questions,” Mattes said. “We are a school that has tremendous choices for students, yet we have hundreds of kids that come out for the game, so it proves their interest and their knowledge [of the stock market].”
Ron Remick has been the club’s supervisor for the past three years. He not only guided last fall’s winning team to the top, but has led others to second- and fifth-place finishes. The club meets once a week after school.
Given the volatility of the economy, Remick said he believes that short selling is a good strategy for the 10-week competition. “When you buy a stock and expect it to go up, that’s buying long,” he said. “When you expect a stock to go down and it goes down, you make money when you sell short. If you sell now and buy it later, that’s how you make money. It’s better to buy it at a cheaper price when it goes down.”
Club members have come to see the wisdom of Remick’s thinking. “Short selling is a good strategy right now,” Stein said. “Everything is going down, so you can’t buy a stock and expect it to go up. ... Maybe, eventually, it will go up.”
The students gain an understanding of how difficult it is to judge how stocks are going to do, even when they’re not playing with real money. “During the game, it’s fake money, so you don’t care as much as if you were actually investing,” Goldbin said. “You can say to yourself, ‘I don’t know if it will be good,’ but you’ll still invest in it because you really don’t have anything to lose. But you still want to do well and get the credit if you do well.”
Other students who are participating in this program hope to benefit from the experience in the real world. “This is more to get knowledge of stocks than trying to win,” Goldbin said. “But if you do win, it’s a big bonus. It’s more of a learning experience.”
Because profits and losses fluctuate throughout the game, a team that does well early on may not finish high in the rankings. There is no telling how the game will end this year.
“I think it’s really important for the students to see that the market is a real risk,” Mattes said. “When you put your money into the stock market, there is always a risk, and the students are seeing that really well right now.”
One thing students learn during the game is that they themselves don’t have any impact on the results. “The game is really difficult, like the real stock market,” Stein said. “We have to do our best and have a lot of luck. You never know how the stocks are going to do, especially in this economy.”
Remick gives students general advice, but doesn’t tell them how they should spend their money. “I want them to try to figure out on their own if they should invest in a stock or not,” he said. “I give them information they may not know on the stock or when results are coming out, but I try not to give them the answer.”
Remick’s main goal during the game is for his students to learn how difficult it is to judge the market over a 10-week span. “I want them to see that 10 weeks is a very short time and you really have to get lucky over that time,” he said. “In order to be a more successful investor, you have to try to buy over the long term. With 10 weeks being so short, you either get lucky or you don’t. But, if you do your research, you have a better chance of being successful.”
Comments about this story? ENemeroff@ liherald.com or (516) 569-4000 ext. 210.
