High school and college students gathered for a fundraising event known as Trading Day for Kids and made stock choices after a monitored debate about the merits of the various equities. Apple
(NASDAQ:INTU), and Google
(NASDAQ:GOOG) were in the kids' final long portfolio -- known as the Rising Stars' Long Portfolio -- while Sony
(NASDAQ:DELL), and Barnes & Noble
(NYSE:BKS) showed up in the short portfolio.
The group of low-income New York area youths were hosted by Youth I.N.C. ("Improving Nonprofits for Children") as part of an effort to raise awareness and money for thousands of at-risk youths. While the kids at today's event didn't trade the stocks in their hypothetical portfolios, over 100 hedge funds affiliated with Youth I.N.C. will place all their firms' trades on October 25 through one of their firms, which has agreed to donate all commissions from the day's equity trades back to the nonprofit. This year, global investment bank Canaccord Genuity is the designated firm.
Since 2006, participating institutional investors and hedge funds have raised $7.6 million via the Trading Day exercise. Youth I.N.C.
spends the funds by empowering 100 nonprofits and impacting the lives of nearly 600,000 children.
Excerpts from the discussion on stocks (video here
) show that many of the kids are already pretty stock savvy.
Sell Apple (AAPL), said Albert, a freshman at Baruch College in New York City, who has already done a stint in the muni bond department of JPMorgan. “Long term, they will win, but comparatively, the Samsung III (SSNLF) is a better product, and that’s going to erode confidence in Apple in the short term.” At the same time, Albert said he would buy Intuit (INTU) due to the compound growth in users, from 8 million to 45 million over four years, a variety of different distribution channels, and a growing presence of smartphones and tablets with more than 50 mobile applications.
According to the final "portfolios," however, it looks like Albert's short on Apple didn't persuade the group.
Anamaria wanted to go long on Johnson & Johnson (JNJ). “They have reliable brands, a wide range of products, and get a good return from what they invest in R&D. Plus, as a consumer staple, Johnson & Johnson is a lot safer than technology, which you don’t need to buy when you can’t afford it.” She adds that Obamacare will be good for Johnson & Johnson because lower health care costs will free up dollars for consumers to buy more of its health care related products.
Another participant, Ana, says Google (GOOG) is a good buy in her opinion because “it’s hard to ignore $4.3 billion in cash flow.” She adds that Android software has been making strides to the point where “it looks elegant,” and will help Google keep its lead in smartphone software. Mohammed S. goes one step further, suggesting that the purchase of Motorola Mobility will enhance Google’s position in the smartphone market.
The Rising Stars' Long Portfolio included Johnson & Johnson, Starbucks, Amazon, Boeing, General Dynamics, Nike, and Samsung. The Short Portfolio included Canon, eBay, News Corp, Green Mountain Coffee, Best Buy, AOL, and RadioShack.
No positions in stocks mentioned.