How to Own a Piece of Your Favorite Brand
Ari B., 15, is a sophomore at Yavneh Academy of Dallas in Texas, U.S. His interest in the stock market began in middle school, and since then he’s traded stocks, bonds and currencies. Ari now runs the investment club at his school, a learning-based group that results in a four-day investment competition that is drawing interest from other high schools. He is also developing a passion for broader financial education in the Dallas public schools by exploring ways to “close the financial literacy gap with students.” In honor of the KWHS Investment Competition Region 3 registration kick-off this week, we asked Ari to share his thoughts on teens and investing. He sent us this personal essay.
Picture the typical teenager, decked out in name brands that are cycled through every six to twelve months. From Adidas apparel to the latest iPhone, teens love to associate with all the top brands. Where does that get us? Sure, we look great, but we also have to shell out big bucks to keep up with the latest tech trends and fads. Imagine the power of changing the role many of us play with these companies; profiting from their sales, as opposed to the reverse. This could be the reality if more teens understood the prospects of owning pieces of their favorite brands and profiting from the companies they know and love.
My Beats Obsession
The average teen knows very little about the stock market and the mysterious world of Wall Street. To most of us, it’s just a place where rich people “push paper.” It doesn’t impact our day-to-day lives, so therefore it’s out of sight and out of mind. Most importantly, many teens may not even realize that they can access the global markets and participate in real investments. According to a study by ING Direct and Capital One, a whopping 87% of teenagers reported they know little to nothing about managing money.
Teens are under-informed about the financial opportunities available to them. The empowerment that comes with owning stock in a company – also known as the shares issued by a company — instead of merely consuming its products is incredible, especially when you make money in the process. Imagine a new generation of financially savvy teens who aren’t just influenced by marketing campaigns for the latest sneaker or technology, but also search for innovative ways to use their product preferences to their financial advantage.
I remember the first time I learned about the possibility of owning a piece of a name brand. A few years ago, I was completely obsessed with buying a pair of Beats headphones. Athlete endorsers such as Richard Sherman, KG, and A.J. Green, made Beats the epitome of cool. After Apple purchased Beats, their allure reached a new level. Suddenly, my daily Google search on “Beats” yielded new content: articles saying that this purchase will boost Apple’s stock price. I was intrigued. Instead of merely owning Beats headphones and squandering a few months worth of savings, I could own part of the company. As a shareholder, I would be associated with the Beats cool factor, and make some money in the process. So, I bought my first stock, one share of AAPL. Today, that share is worth more than 1000% of the price I paid; enough to buy even the most expensive pair of Beats a few times over. This epiphany moment was crucial to my financial development.
As teens, we actually have some inherent advantages over adults when it comes to investing. Unlike many adults, we may have disposable income that isn’t being maximized; it either sits in the bank or is spent on a new video game. Additionally, when compared to adults, teens do not have many financial obligations, so investment decisions during teenage years aren’t nearly as risky. What if more teens invested their birthday or babysitting money into the stock market? These funds are not required to pay a mortgage or cover the month’s grocery expenses, but they could help us do just that in the future! By employing a basic buy-and-hold investing strategy, we could gain much-needed exposure to financial markets, as well as some serious cash. An average teen who chose to own a piece of the company Facebook five years ago has benefited from a 400% return on that investment! More practically, we will eventually grow up to be adults. Only half of all adults in the U.S. invest in the stock market, according to a Federal Reserve study. As we gain knowledge and confidence with the financial markets, our generation will become that much more involved in the stock market.
RV Nation
Let’s face it, young investors also hold a certain advantage over our parents’ generation: we know what’s trending before anyone else does. Millennial trends can actually drive the stock market. Goldman Sachs noted that millennials are the largest generation alive, and are about to enter their prime spending years, making them an appealing demographic with tremendous financial leverage. To illustrate this point, recently on CNBC, famed analyst Jim Cramer was discussing the oddly fantastic earnings of RV company Thor Industries. Cramer was puzzled as to why the company’s lackluster earnings suddenly picked up, resulting in the stock rising 13%. After all, RVs are a thing of the past. Now people can actually fly to where they want to go, instead of driving highways and back roads for hours in a cramped, half-car half-trailer. However, Cramer concluded that this turn-around at Thor Industries was due to the millennial uptick in RV renting; a trend unforeseen by a Baby Boomer such as Jim Cramer. Teens, who instinctively track trends (and help influence them), are uniquely positioned to transfer their knowledge into investing ahead of the curve.
Many of today’s teens are blind to the potential of the stock market in their lives. By flipping the narrative and educating teens about the power of investing in brands, versus consuming them, our next generation could turn pocket money into major spending power. More importantly, investment expertise — a key component of becoming financially aware — would become an important money-management tool at an earlier, less risky age. By acting on the skills that come from financial education, we can build a more empowered generation that is better positioned for a prosperous future.
Related Links
- How to Put Teenagers on the Road to Wealth
- TheStreet: Here Are the Brands U.S. Teens Are Starting to Hate
- Thor Industries Stock
Conversation Starters
Do you agree with Ari B’s assessment that “teens are under-informed about the financial opportunities available to them”? Why or why not? Do you agree in general with the premise of Ari’s essay? Share your reflections in the comment section of this article, and ask him your questions. He may just answer you!
Are you a young investor? How did you get involved with the stock market? Share your story in the comment section of this article.
Why is it valuable to begin investing when you’re young?
I agree with Ari’s opinion that “teens are under-informed abouth the financial opportunities available to them”. As my own experience I know few “teens” that really manages a stock market and really invest their time and money on the market. Most of the young are on their comfort zone of their parents, they don’t really feel the need to invest their time and money so they can gain new experiences and get prepared to the future. If our generation was more interested on the stock market, we would get a lot of outcomes and as Ari said we would have a more empowered generation that is likely to be more successful. I don’t consider myself a young investor, I never invested real money on the stock, but I’m very interested in investing my time, money and gain new experiences. I think it’s really good to start when you are young, so on the future you will be prepared and you will have an idea on how it works. Those who start at a young age are getting a step ahead.
How much money did you invest at the beginning?
Is it hard to keep up with the market?
Hello Daniel,
In the beginning, I started with a couple hundred dollars that had been saved up from previous birthdays etc. As I received more money over the years (Bar Mitzvah etc.), my portfolio size grew, and now I manage thousands of my own dollars. As to keeping up with the market, I find that it can be arduous to try and track lots of stocks, so I generally narrow my investing focus to certain stocks or sectors and avidly track their stock prices and the news coming out related to them (Seeking Alpha or the CNBC give great news updates).
Glad to help,
Ari
I agree that teens are not informed properly about investing in the stock market. I thought it was really cool how you talked about saving money, and its importance and ability to provide new experiences and teach you how to become financially literate. Learning how to trade in the stock market also prepares you with knowledge that will be necessary as an adult. One question I have for you is; how much time do you spend interacting in the stock market?
I do agree with Ari Berke’s assessment that “teens are under-informed about the financial opportunities available to them” because most schools do not teach students about stocks and other financial opportunities. Also most teens have not given these opportunities chances; they just go on with their life without thinking about investing in stocks and other opportunities. In addition, I do agree in general with the premise of Ari’s essay because his essay is all about how teens need to start taking these financial opportunities such as investing in stocks. He also talks about how some teens might have no interest in investing; however, they should still be informed, which I think is very important. My question would be what or who inspired you to invest? Unfortunately, I would not consider my self a young investor because I haven’t invested my own money. However, I am looking forward to when I decide to start looking into the stock market. It is valuable to begin investing when you’re young because then you are getting a step ahead of everyone else. If you start when you are young imagine where you will be when you are older.
Hello Jacalyn,
I think one of my influences to start investing was my intellectual curiosity. As I mentioned, when I stumbled upon an article regarding Apple stock, I was immediately drawn to the concept of investing. Had I disregarded the small headline, a world of opportunity would have been lost. So keep looking and never close yourself off to an opportunity or new concepts.
I do agree with Ari’s assesment, mostly because when I last traveled to Brazil to see family, my friends and even my brother had little knowledge on investing, and the stock market. As Ari said, us, teens don’t need to pay bills so instead of buying new things or letting it sit in the bank account, teens should put their mney somwhere where it will grow. After the first stock market simulator I did, I went to my dad and asked for him to invest on Amazon in which he has profited and since I have been looking for more opportunities. I got involved with the stock market whilist learning abou it and simulating during my finance class.
What are some sites/apps you would suggest to be updated about the market?
Hello Joao,
There are many good market sites out there; I personally prefer Seeking Alpha or the CNBC app. However, you don’t necessarily need a specific stock oriented site to keep up. Almost all news has a financial slant, so the while Wall Street Journal or NYT may not be stock market-oriented, its content can easily be applied to the market.
Thanks,
Ari
1. I completely agree with the fact that teens are financially underinformed. Most teens I know do not know the first thing about saving or managing their money, much less investing. I think this is because it is never tout to them. They need to be tout how to invest their money.
2. I am not an investor however I am going to start investing soon. I have been interested in the stock market for a while now but I didn’t know where to start. I recently finished a stock market simulator and I did well so I want to start soon.
3. Someone once said, “It’s not your timing in the market, it’s your time.” This means that your timing doesn’t have to be perfect, you just need time in the market to grow. The sooner you start to grow, the greater the opportunity is to gain money.
Despite the fact that we are now more prone to be self-taught by using online educational services, and that this trend will continue to increase on every topic, including finance, I completely agree that teens are financially uninformed. You would expect that at least 40% of the students in a high school finance class own stocks or that at least they know few stock market strategies. Even though there are some teens that are highly informed about financial opportunities, for others, that’s not the case.
Why? I think the main reason teens are financially under-informed lies in the fact that teens are faced with the challenge of being self-taught.
It is very valuable to begin investing when you’re young because at a young age you have plenty of time ahead to build your capital.
I agree with him because many people and teenagers don’t really think and know how to invest. This happens because they aren’t really focus on the future and their parents don’t give them a wake up call about what is going to happen in the future. Also I really liked the article and for teenagers it can be very helpful to them.
Im actually not a young investor right now because I’m still getting some money together so I can start to invest.
I agree with Ari because most teens do not know much about stocks and are ususally not taught untill older. Teens are financially uninformed and that is a big problem since teens are the next generation and our future should know about stocks and how to invest so they will be financially stable.
No, i am not an investor but my dad is. My father invested in a company that does restoration for houses. He invested because he had a gut feeling that this company will become big and his investment will pay off.
It is valuable to begin investing while your young because investments need time to grow and expand and if an investment goes the right way then that teenager can be succesful when they are older.
I do agree with Ari’s statement that most teens don’t know much about the financial opportunities available to them. Most teens don’t really know how to do these things until till they are older.
I am not an investor but my brother and my dad are. When I am older, I want to be able to invest in things that I know can do me some good.
It is valuable to begin investing at a young age because some investments need time for you to make money and that can make a smooth transition from teens to adulthood.
I definitely agree with Ari’s claim about teens being under-informed about financial opportunities, but I feel that this is something that is slowly beginning to change in many communities today. Many school curriculums and programs focus on “core” subjects (Math/Science/English/History), but very few include various opportunities for teens to gain a better understanding of how finance and economics works. Thus, the responsibility of learning about financial opportunities falls on the shoulders of students, many of whom don’t continue their financial learning. However, we see so many clubs popping up in high schools, and the popularity of various stock market competitions (Including the KWHS investment competition), that just goes to show the growing interest in financial literacy and opportunities.
I have only recently begun my journey in the investment world. While participating in the KWHS investment competition this past winter, I decided to open up an account for investing and trading. However, I have spent the past 5 months getting a better understanding of how the market works, that way I am more prepared when I start to invest my money. My dad and his friends are also involved in the stock market, and they are a great resource to rely on for questions! I think that now (16-17 years) is the perfect timing to begin your adventure in the investment world. It gives a person enough time to learn about the market and understand how to analyze trends, but they also have more opportunities to make money!
I really enjoyed Ari’s article, as it definitely relates to many things I see at my school today. Peers are pushing themselves to take on two-three jobs so they can physically “own the brands they love”, while handling their course load and getting enough sleep at night. If we offered more opportunities for teens to learn about the stock market, and how they can own a part of their favorite brand, we could bring many more teens into the investment world!
Hi Sahiba. Thank you for your thoughtful comments! I can tell you have a genuine passion for investing, even as a newcomer to the stock market. You’ve sparked my curiosity about the financial education situation at your school. Do you have access to financial classes or did you compete in the KWHS Investment challenge through a club? And when you say that your peers are taking on many jobs to “own the brands they love,” do you mean they are earning money so that they can invest? I find that fascinating and would love to know more about it. Good luck on your investment journey!
My interest and passion for business and investing has actually been done independently from my school or clubs. My school does not offer many business-related classes, outside Microeconomics and Macroeconomics, so any classes I wanted to take I went to a local college. I feel like learning independently helped me develop my own opinions and perspectives on different matters, which sets my views apart from people who might have a lot of in-school exposure.
As for taking on jobs to own the brands they love, I meant that people are finding jobs in industries that they are passionate or interested in. Some of my friends are excellent swimmers, and they decided to take up jobs at a local waterpark. As i mentioned, students at my school really have to go outside the box to learn more about business topics (especially investing), so I think there’s a lack of understanding of what all a paycheck can do, and I definitely feel like that’s something that ny school community wants to change. I feel that a lot of people are saving money for college, which is an investment in itself! But when I participated in the KWHS Investment competition, I talked to a couple people who decided to start investing in 1-2 companies just to get a basis for how to invest and developing a strategy.
I actually agree with Ari B’s assessment. Young people are exposed to a wide range of investment environments these days, but due to the lack of capital investment with professional skills, many of them just stay in their imagination. Some teenagers can’t help but spend a lot of money on games or some meaningless things because they don’t know how to manage money. For example, in China, there are many stories about children using their parents’ mobile phones to spend on games. At the same time, this also gives me some worries. If children are really exposed to these resources in a large amount, they may be more insightful than adults, but they will also be more irrational than adults. If they are addicted to the investment world, and secretly use their parents’ money to invest in a large number of unstable stocks, will it cause a greater burden on the family?
Question：
How can we buy stocks? Any advice for people who have just started buying stocks?
Hey, Sunny. I’m glad you found your way to Ari B.’s essay. Still one of my all-time favorite student essays. The stock market and investing are a world unto themselves, and filled with lots of opportunities for learning. I would suggest you visit our Wharton Global High School Investment Competition website, where you can learn about our annual asset management competition and get lots of great student resources, too. Exploring the student resources section (https://globalyouth.wharton.upenn.edu/investment-competition/competition-learning-materials/#students), as well as on the homepage (https://globalyouth.wharton.upenn.edu/investment-competition/) is a great place to start. Good luck!
I agree with the statement “teens are under-informed about the financial opportunities available to them”. I know many teens that don’t know anything about the stock market and don’t even bring it up in conversations. Most teens that I know also leave the stock market to their parents and don’t even ask what the stock market is. I am not an investor but I am very interested in investing my money to learn a new experience that could help me a lot in the future.
How much time and money do you put into the stock market?
Any tips on buying stocks for new investors?
I believe that Ari B’s comment, “teens are under-informed about the financial opportunities available to them”, is true. This is because very few teens know the power of stocks and how much money stocks could bring. I am interested in investing in the future.
How do you know the correct stocks to invest in?
Does researching the company give you a better outcome?
I agree with Ari B’s assessment because many times when kids are “old enough” it is already too late to utilize their financial opportunities to their fullest potential.
Yes i agree with the fact that “teens are under-informed about the financial opportunities available to them as many kids do not see full potential in them self’s on making money and being responsible for money as it is seen as a very adult thing to be watching over and kids are very shun from the thought of controlling money as they are just “kids”. However learning money at a young age is key to being successful in the future as it provides a standing stone for you to enter the professional world .
I heard about investing from my parents at a young age which intrigued me into learning more about it and i got to a point where i understood a basic understanding of what the stock market was and now i am trying to expand my knowledge further .
I agree with his idea that teens have a bigger advantage and it is also less risky for us as we have no financial obligations.
I agree with Ari B. We have a bigger advantage and it is better to start young so that you have a long time to save up.
It is better to start young so that you have a long time to save up.
Yes I am a young investor and beginning investing at a young age is valuable for several reasons. Firstly, it allows for the power of compounding to work over a longer period, potentially resulting in substantial returns over time. Secondly, it helps individuals develop a foundational understanding of financial markets and investment principles, which can be valuable in making informed decisions throughout life. Finally, early exposure to investing instills discipline and patience, important traits for successful financial management.
For those who are young investors, sharing their stories about how they got involved with the stock market in the comment section of the article can inspire and encourage others to explore investing as well. Hearing about personal experiences can demystify the process and showcase that investing is accessible to individuals of various backgrounds and ages.
It is valuable to start investing from a young age because there is a high probability that those investments will grow over time. Furthermore, learning about investing from a young age will allow you to become more proficient at it over time, thus leading to making more money.