| Most
teens new to the investing world think that picking a good
stock requires understanding of financial statements,
complex charts, ratios, market trends, and so on. While
being able to understand an income statement or knowing
how to calculate a P/E ratio may help, it is definitely
not necessary.
Kids can easily
pick stocks just by knowing how a particular market,
namely them, spends its money. With a minimum of research,
it would be easy for any child or teenager with internet
to find out that 4 Kids Entertainment has the license for
Pokemon. When the Pokemon craze started up, some kids
bought all of the toys that they could afford to. The kids
and teenagers with the most foresight and investment
knowledge bought stock in 4 Kids Entertainment along with
the toys. The kids who bought stock probably ended up a
lot happier.
Want examples? Let. s
look at a specific time period.
Someone who bought
one hundred dollars in Pokemon collectibles or toys in
February of 1999 got some enjoyment out of them. If the
collector sold the Pokemon collectibles or toys on
Ebay.com in November of that same year, chances are fairly
good that he broke even.
Now look at not a
collector, but an investor, who bought 100 dollars in 4
Kids Entertainment stock in February of 1999. That
investor could have sold his stock in November 1999, and
ended up with around 1,800 dollars.
Any 12 or 13 year old child
could have increased their investment 18-fold just by
asking themselves a simple question: "What. s popular
in today. s market, and how can I make money off
of that?"
|
