Stock Market Games

In schools throughout the world, classes of students studying economics are usually encouraged to participate in stock market games in which a person will be given a notional sum of money to “invest” on shares on the stock market. This will mean that they will be testing their skills against other students in the class, with prizes awarded for those who have made the biggest paper profit. The game is used to explain the vagaries of the stock market, and is usually popular, as some students quickly make large profits, and others “lose” money. It is most often played in wealthy countries where many children know the operations of the stock market, and it helps teach others about the nature of stock exchanges.

Although these games have been played since the 1920s in the United States, the United Kingdom, and elsewhere, on a wider scale, the “game” is also played by all sectors of society. In 1981 when there was a newspaper circulation war in Britain, The Sun and the Daily Mirror introduced bingo competitions to attract new readers. Their aim was to establish a competition that ensured that players would buy their newspaper each day. As the broadsheet newspapers introduced their games, the more sedate The Daily Telegraph, in an effort to win a greater share of the readership as well, introduced their own “bingo” by which readers would compare various share prices.

It is also common in schools for stock market competitions to be run, especially in economics classes, to encourage school children to participate in buying and selling shares, with all students starting with the same monetary stake. A prize is then awarded to the person whose investments are worth the most at the end of a given period, with a number of schools sometimes pooling their resources to have an overall winner from a town or region.

The game is often won by those who invest shrewdly, following the advice and suggestions from the financial pages of the newspaper, but there is no actual monetary involvement. The competitions are often won by speculation on shares valued at around 1 cent, on the basis that any small gain in price would reflect a major increase in the nominal investment.

For this reason, many games have rules by which the shares must be those traded on the local stock exchange, and the investment portfolio allows for no more than 25 percent, or 50 percent, to be invested in the shares of any individual company. Most competitions insist that a certain percentage of shares also be invested in one of a listing of major companies to try to teach the importance of “blue chip” shares, rather than gambling, which since the advent of online trading and computer selling have encouraged the emergence of the “day trader.”