# Foundations of Personal and Family Finance

Mary Lou Poloskey teaches the Foundations of Personal and Family Finance at UT at Austin, where the McCombs School of Business has their own branded site of the Stock-Trak virtual trading platform.

She uses both of the StockTrak financial simulations, the Stock Game, and the Budget Game.

Her class projects that use Stock-Trak have multiple parts, some are individual, and some are done in groups. There are four projects in all in her class, two of them are using the Stock-Trak simulations and lessons. Each project is worth 10% of their overall grade.

## Budget Game

The individual component includes completing the 12-month Budget Game. For the first 4 months students are in the part-time game mode. During that time, they are college students with part-time jobs, and then they graduate (in the simulation) and work full-time for the following 8 months.

Poloskey customizes the standard of living to reflect the cost of living where the university is based. She adjusts the housing and taxes for her state. She also adjusts the default settings for the starting cash in the game. She provides students with \$2,500 in their savings and \$1,000 in their checking account that they earned from their summer internship.

There is a written component for the Budget Game that is completed in groups. Students must answer the following questions as if they are the individual from the game. She presents the scenario as if the student has graduated, and now it’s 8 months later. They have the same financial situation they had while playing the Budget Game.

1. How much do each of you have in savings at the end of the game (state the highest & lowest ending savings amount out of all group members). Is this enough of an emergency fund? What amount (\$) should the person in the game have accessible in case of an emergency? (Show support for how you came up with this number). What (if anything) should you be saving for besides the “emergency fund”?
2. List at least 3 expenses that you incurred during the game that surprised you (things you would not have included in your budget). List at least 3 expenses you expect to incur when you graduate and are working that are not included in the game. Should you budget for these?
3. Did you all use your credit card? List at least 3 advantages and 3 disadvantages of using credit cards. What was the highest ending credit score among your group members?
4. What did this group member do differently from the rest of the group that caused the higher credit rating?
5. How is net worth calculated in this game? List 3 things that could increase your net worth over the next year.
6. What was the highest quality of life score among your group members? Did the group member with the highest quality of life have the least net worth? Why or Why not?
7. Come up with 3 Financial Goals (one short term, one intermediate & one long-term). Use the SMART approach to support each goal.
8. What have you learned from this game/project? How will this change your current budgeting? How will this change your budgeting when you graduate from school and start a full-time job?

## Stock Game

For the Investing Project Module, students have an individual and group component. 40% of their grade is based on the individual part that includes:

• Setting up their portfolio in their Stock-Trak accounts (20%)
• Watching Stock-Trak tutorial videos (10%)
• Answering Investment Strategy Questions (10%)

The Investment Strategy Questions help students determine which stocks and ETFs they will purchase in their virtual portfolios. Below are the questions that students must complete and submit as a Word document.

1. Do you think the current Business Cycle is in an expansion or a contraction phase?
2. What specific economic data have you based this on?
3. What is your risk tolerance? How will this affect your investment strategy?
4. Based on the above questions which specific industries/types of investments will you invest in? (Do not list specific companies).

Poloskey adjusted the default settings for the Stock Game so that students are using a buy & hold strategy. Below are some of the main settings she uses:

• Initial Cash: \$25,000
• Security Types Enabled: Stocks & ETFs only
• Position Limit: 10%

Students are required to invest in 4 Stocks and 3 ETFs, no more and no less. With one of the ETFs being the S&P 500. There is a strict due date to complete all the orders, and then the rest of the semester students hold and watch how they perform. With the goal of investing all their initial cash based on how they answered their investment questions.

The remaining 60% of the Investing Module is based on the Investment Portfolio Analysis project that is completed in teams. She ends the trading period several weeks before the end of the semester, that way all portfolios are frozen while students conduct their analysis.

The groups consist of 3-5 students. They compare their portfolios and choose 2 Stocks and 2 ETFs to present to the class in a 5 to 7-minute presentation. In their presentation, student teams must answer the following questions:

1. What was your best performing stock amongst the group during the period? Why did you include this stock in your portfolio?
2. What was your best performing ETF amongst the group during the period? Why did you include this stock in your portfolio?
3. What was your worst preforming stock amongst the group during the period? Why did you include this ETF in your portfolio?
4. What was your worst performing ETF amongst the group during the period? Why did you include this ETF in your portfolio?
5. How did the market (as represented by the S&P 500) perform during the period? What events caused the market to perform this way over the last two months? How many of your portfolios outperformed the market? You will have to compute the return on your portfolio. Portfolio return = (Current Portfolio value – \$25,000)/\$25,000.
6. Has this project changed how you plan to invest in the future?

Mary Lou Poloskey has graciously shared her class projects and syllabi so that other professors can see how she incorporates StockTrak within her course.

Please click the link below to get access to the Fin322F HDF 322 Syllabus Fall 2022. Below that are the details for each her class projects.

### Fall 2022

This project has individual & group parts.

Individual Part  (30 points)

Each student will play the Budget game for 12 months. The first 4 months you are working part-time while in school & then you graduate (Yea!) and work full-time for the following 8 months. As a student working part-time, you will not be making enough to cover all of your expenses, but you have \$2,500 in savings and \$1,000 in your checking account (from your summer internship). In month 5, you start working full-time. Your paycheck goes up, but so do your expenses.

##### For this project, we are using the Budget game on StockTrak. Later in the semester we will be using the Investing part of this site. For now, DO NOT do anything in the Stock Game, only go to the Budget game!

To register for StockTrak go to: [Poloskey shared the registration link here].

There are 2 deadlines for completing the individual budget game online.

• Tues. Sept. 13th   10:00pm – Part A – register for StockTrak and watch all the assigned videos and complete the first month of the game. This is listed as First Assignment in the game (See right hand side of screen when you are logged into StockTrak)
• Sat.   Sept. 17th 10:00pm – Part B – complete the remaining 11 months of the game. This is not listed as an Assignment in the game, but the game will end and you won’t be able to play it anymore. You will be able to review final results.

Group Part (70 points)

Complete this part after finishing your individual games. The group part of your project is due Fri. Sept. 23rd at 10:00pm (uploaded to Canvas).

Each group will upload one Word document answering the following questions. List your group members names. Only list those that actively participated on this assignment. Business writing needs to be concise but thorough. To receive full credit for this part all questions must be answered completely. The Word document should be neat & well organized. Number each response, use proper grammar, etc..

Discuss and answer the following questions as if you are the individual in the game and have been out of school for 8 months, and have the financial situation represented in the game.

1. How much do each of you have in savings at the end of the game (state the highest & lowest ending savings amount out of all group members). Is this enough of an emergency fund? What amount (\$) should the person in the game have accessible in case of emergency? (Show support for how you came up with this number). What (if anything) should you be saving for besides the “emergency fund”?
2. List at least 3 expenses that you incurred during the game that surprised you (things you would not have included in your budget). List at least 3 expenses you expect to incur when you graduate and are working that are not included in the game. Should you budget for these?
3. Did you all use your credit card? List at least 3 advantages and 3 disadvantages of using credit cards. What was the highest ending credit score among your group members? What did this group member do differently from the rest of the group that caused the higher credit rating?
4. How is net worth calculated in this game? List 3 things that could increase your net worth over the next year.
5. What was the highest quality of life score among your group members? Did the group member with the highest quality of life have the least net worth? Why or Why not?
6. Come up with 3 Financial Goals (one short term, one intermediate & one long-term). Use SMART approach to support each goal.

What have you learned from this game/project? How will this change your current budgeting? How will this change your budgeting when you graduate from school and start a full-time job?

### Fall 2022

Individual Part will include your investment Strategy Questions, watching StockTrak videos and setting up your portfolio. These individual parts make up 40% of the project grade. The other 60% will be your group presentation at the end of the semester.

Individual Investment Strategy Questions (10%) due Friday, Sept. 30th at 10:00pm Upload to Canvas under Investing Project Module the assignment is called Investment Strategy Questions.

Answer the following questions in complete sentences. Number your responses. This assignment will determine which stocks & ETFs you “purchase” for your individual portfolio (last individual part of this project). Upload a word doc to Individual Investment Strategy Questions on Canvas.

1. Do you think the current Business Cycle is in an expansion or a contraction phase?
2. What specific economic data have you based this on?
3. What is your risk tolerance? How will this affect your investment strategy?
4. Based on the above questions which specific industries/types of investments will you invest in? (do not list specific companies).

StockTrak videos (10%) due Sun. Oct. 2nd at 10:00pm

Use the same username & password from the Budget Game we did earlier this semester. This is set up as an assignment in StockTrak.

Portfolio set-up in Stocktrak (20%) due Thurs. Oct 6th at 3:00pm

This project will be using StockTrak. Go to https://mccombstrading.stocktrak.com

Use the same username & password from the Budget Game we did earlier this semester. Use the Stock Game tabs to buy stocks & ETFs and monitor your investments. You can “purchase” your stocks & ETFs between Mon. Oct. 3rd – Thurs. Oct 6th 3:00pm (Closing of the market). You can place a trade at any time, but they will only execute when the market is open.

• Account setup in StockTrak:
• You must buy 4 Individual Stocks and 3 ETFs for your portfolio (7 total investments)The Stocks & ETFs you purchase must follow your Investment Strategy.Each student has \$25,000 of faux funds to invest in the game. Each account must be fully invested, with no more than \$2,500 in a cash account. One of your investments must be a S&P 500 ETF (which will track the market). You can buy VOO or SPY or another ETF, as long as it is the entire S&P 500.Each trade requires trade notes, you must document why you are buying each stock or ETF.
• After you choose the initial 7 stocks/ETFs, you will hold & watch those investments for the rest of the semester.
• You must be fully invested (\$22,500 – \$25,000) by the end of the trading day, Thurs. Oct 6th (3:00 Austin time). Make sure all trades are executed, they do not happen instantly.

You are deciding which 4 stocks (no more or less) and which 3 ETFs (only 3, one of the three must be a S&P 500 ETF) and how much to put in each so that at least \$22,500 is invested.

### Fall 2022

Group Project Investment Portfolio Analysis (60% of Investing Project grade)

Stocks will continue to trade until close of trading day on Fri. November 18th. You can’t work on this until after that date! Your portfolio will freeze at that point – the game ends, but you can still access it, amounts will not change.

Each group has 3-5 members. You will need to look at each of your investment portfolios & meet collectively as a group to compare. You will prepare a 5-7 minute presentation covering:

1. What was your best performing stock amongst the group during the period? Why did you include this stock in your portfolio?
2. What was your best performing ETF amongst the group during the period? Why did you include this stock in your portfolio?
3. What was your worst preforming stock amongst the group during the period? Why did you include this ETF in your portfolio?
4. What was your worst performing ETF amongst the group during the period? Why did you include this ETF in your portfolio?
5. How did the market (as represented by the S&P 500) perform during the period. What events caused the market to perform this way over the last two months. How many of your portfolios outperformed the market? You will have to compute the return on your portfolio. Portfolio return = (Current Portfolio value – \$25,000)/\$25,000
6. Has this project changed how you plan to invest in the future?

Compare all of your portfolios & decide which 2 stocks & 2 ETFS your group will be speaking about. Even if all or most of these came from one member’s portfolio, you can each briefly discuss at least one. Be sure to split the presentation up equally. Include –

• Use a visual to support your presentation (graph, picture, etc.) You will display it on the Doc camera in the classroom. There isn’t time to set up a computer, so have your visual ready to display on the doc cam.
• Tell why these stocks and ETFs were your best and worst. Include a company descriptions and  the ETF investment strategies (for your best & worst).What specifically happened to make these companies or ETFs perform differently from the market?
• Did economic conditions impact your success? If so, how?
• Would you keep these stocks/ETFs in your portfolio going forward?
• Do your results support active (choosing stocks & ETFS – like we did in this simulation) or passive investing (putting all investments into the S&P 500 or other broad stock index)?
• Conclude with how this project has impacted how/if you will invest in the future.
• Presentations will be during our class period on Wed. Nov.  30th and Mon. Dec 5th. All group members must contribute and present to the class. There is no other way to earn the points for this part of the project.  If a group member is not willing to meet & contribute, let me know and I will assign them a zero & then the group can proceed without that member.