Students at this high school are learning to invest with real money
The Gray Bee Investors looked into potential investments at their recent meeting.
Real money is on the line at St. Benedict’s Preparatory School Newark, New Jersey.
This year, the Gray Bee Investors club — made up of about 15 high school students — is helping make investing decisions for the Grossman Family Student Investment Fund, which was established through a $100,000 gift to the school from the Grossman Family Foundation.
Grossman gave the school money to support the financial education.
Steven Grossman (philanthropist, founder of Grossman Family Foundation) stated, “Everybody has money. They have checkbooks, credit cards, and debit cards. But most people don’t know the nuances of investing, saving, and budgeting.” It starts by giving people a basic understanding of their personal finances. Then they can learn more about investing.
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The current investments include a wide-ranging portfolio. S&P 500 Index fund. After voting, the students decide which assets they want to invest and part of their funds can be sold to acquire the items they suggest.
Guitze Rodriguez (17), Guitze Rodriguez is a St. Benedict’s senior and chairman of the investment club.
Alumni working in finance are connecting students and graduates
Gray Bee Investors was founded in 2020 by Mike Scanlan (dean of administration, St. Benedict’s).
During the peak of the pandemic in its first year, they met via video conference twice weekly to share their financial knowledge and connect with many alumni volunteers. Together, they also took part in a stock-market game.
Scanlan explained that one benefit to the virtual group was connecting current students with former finance alumni.
Mike Scanlan, dean of Admission at St. Benedict’s, is also the leader of the club’s investing program.
He said, “They had to look at people like them in the investment industry, children of color.”
St. Benedict’s is committed to helping students in Newark and surrounding areas. According to school website, almost 80% of students are Black or Latino. 88% receive a partial or full scholarship.
It was important to start with the basics of money management, such as budgeting.
“[Scanlan]”Had a great philosophy of teaching us personal finances first before we began investing even though it wasn’t virtual money,” stated Davion Cottrell Miller, 17-year-old senior at St. Benedict’s who is the treasurer for the club’s investing club.
It’s all about real money
Scanlan decided to adopt a new approach than the stock market investment game when the money was presented to him.
Students had begun investing during the pandemic dip in the stock market and were able to invest through record breaking rallies to new highs.
Scanlan said that students bought into the market at its lowest point, and that they only saw gains. He also stated that advisors were concerned that these students would think that investing is easy.
Scanlan and alumni advisors from the club asked the students to research sectors they were interested in or believed would be good investments over the long-term. The students from Georgetown University Student Investment Fund assisted them in their research.
Real money was a huge help to students.
Davion Cttrell-Miller (17), a St. Benedict’s senior and treasurer of the investment club. He said, “The money has changed the investing, it’s different. I’m taking this seriously.”
According to one sector team, the fund should only invest in these areas. VanEck Semiconductor ETFDue to its past performance, and the expense ratio. Rodriguez was given the task of presenting to school’s finance board.
Rodriguez said that Rodriguez never thought that he would meet with the school’s finance committee. He also stated that this was an excellent learning experience.
Now the group prepares to attend the next finance committee meeting, at which they expect they will be asked further questions about their investments. Recent factors like the Russia-Ukraine conflict and a shortage of chips have made it more volatile for their ETF.
Scanlan said, “I don’t like portfolio management, but it’s great for teaching,” and that even though stocks may be down, the club continues to discuss investing principles.
Scanlan stated that although the school occasionally offers a class in personal finance as an elective, it isn’t available for this academic year.
Scanlan stated that eventually he will be able, with the help of the fund, to withdraw up to 4% per year and spend the money on improvements at the school. The students will decide which improvement projects he recommends.
According to him, the club could switch from investing in sectors to building a portfolio that would fit what a younger investor might want for their 401k plan.
The club’s main focus is on investing but it spends much time discussing personal finance basics. The club’s ultimate goal is to provide students with a forum where they can gain knowledge about money management. Many people don’t have the time or resources to do this at home.
Scanlan said, “These children are just as ambitious as those who hear about it around the dinner table.”