Sponsor Spotlight: Cambiar Investors – Investment Company

Young Americans Center for Financial Education Young AmeriTowne Leave a Comment

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Cambiar-InvestorsAs children become more aware of money and other financial concepts, it’s vital they are armed with important investment knowledge. When students visit the Investment Company at Young AmeriTowne they have the opportunity to participate in tailored-made lessons which were created with input from Cambiar Investors, an award-winning asset management company headquartered in Denver, Colo. Investing is a core concept presented in the money management section of the Young AmeriTowne curriculum.

At school, a risk-assessment quiz is taken by each student. They are asked questions they can easily relate to in the quiz, like their tolerance of roller coasters, for example. Upon completing the quiz, students find out their tolerance and comfort level for financial risk. Based on their results, they select a pretend CD (low risk), mutual fund (medium risk), or stock (high risk) and invest one dollar in AmeriTowne currency.

With their single dollars invested, the CD offers 3% increase (3 cents) if their investment is profitable, a 10% increase (10 cents) if their stock is profitable, and a 5-7% increase (5-7 cents) if their mutual fund has grown. The investments are directly linked to the shops’ performance and dependent on if the children running the shop that day were able to pay off the business loan with a profit, or if they come up short.

For example, AmeriTowne’s grocery market is linked to the stock. If the market makes a profit after paying off the bank loan, the kids earn that 10% increase on their investment. If the market’s account finishes in the hole, their investment depletes from $1 to 90 cents. The mutual fund is linked to three shops in town: Market, Containers Shop, and Sign & Print. If only one of the three shops makes a profit, there is a 5% increase; two stores post a profit, a 6% gain, and all three shops, offers a 7% increase. The CD is not linked to any shop in AmeriTowne; it increases in value by a steady 3%. This is discussed in follow up lessons at school, once bank statements have been issued. These statements are delivered via post mail, and discussed in the classroom.

Students gain real-life experience as an Cambiar Investment Company employee:

  • Investment Advisors use real-time data to see how the Towne economy is performing.
  • The Investment Manager surveys shops included in the investment portfolio: the Market, the Sign and Print Shop, and the Container Shop.
  • Student Accountants keep track of all business expenses and revenue.
  • Students in all shops invest in either a stock, mutual fund, or CD before Towne and can change their investment during Towne by visiting the Investment Company.
  • Students in all shops deposit a paycheck and keep track of spending by balancing their personal checkbooks.

Here are some tips parents can use to teach their kids about investing:

  • Make investing a dinner table topic – a fun game for the entire family. Pick (or actually invest) into a couple of stocks. Watch the stock rise and fall.
  • Have children invest in companies they understand. Children are more likely to be interested in companies in which they know and understand. It also helps parents to frame discussions about investing.
  • Teach children about inflation before they start investing. Students quickly grasp that peoplecan make money by investing but they have a harder time understanding that investing can be necessary to prevent inflation from eating away at their savings. Tip: keep things simple, don’t use all the jargon.
  • Let them take the wheel—within limits. Be ready to step in, and always reinforce good values, but give children the confidence and space to experiment. Once children start earning income, the next step is to open a retirement account.
  • Consider working with Cambiar Investments. Cambiar has a diverse group of investment offerings, ranging from domestic focused to global opportunistic funds.  Each strategy can be utilized as an integral part of any investor’s asset allocation model. The Cambiar Mutual Funds are designed to be benchmark agnostic. Their belief is that in order to outperform a benchmark by any meaningful amount, you must differentiate yourself.
  • Read about other investment options here.
  • Testing your knowledge. How much do you know about the stock market? Take this quiz to find out and learn more. (The quiz answers can be found here.) Be sure to stop by Young Americans Bank to get more information on investing and stock markets!

Thank you Cambiar Investments for your continued support of Young Americans Center for Financial Education. Each year, thousands of kids are learning about the advantages and disadvantages of investments. Preparing them for the real world, where soon, they will need to make real decisions and real risks.

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