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INTRO: Economics 212 – Personal Investing – Online
General Description of Economics 212 – Personal Investing
This is an introductory economics course. It offers a wide-ranging overview of the role financial assets can play in achieving personal financial goals. This course won’t make you a millionaire, nor will it prepare you for a career as a hedge-fund manager. The goal is to increase your understanding of how financial markets work, and how to use financial assets as part of a life-long financial strategy. Your understanding of financial markets will be enhanced by learning the tools of economics, incorporating knowledge of human behavior, and becoming familiar with particular aspects of financial markets and assets.
In this course I offer you an introduction to investing within the context of a lifetime of personal finance. It’s not a personal finance course as such since we don’t talk about buying a car or a house, or using a credit card wisely, or managing your FICO score. But personal finance is the context for presenting and discussing all investment opportunities, so it is never too far from our minds.
Here are my expectations for you in this course. I hope you will:
1. Participate in the discussions and active learning opportunities
2. Enjoy playing the Virtual Stock Exchange game, even when it gets frustrating
3. Follow all applicable rules regarding academic honesty and student conduct
4. Treat your fellow students with respect,
and by doing so, you should:
5. Learn how simple economics can be relevant and useful
6. Remember some information about financial asset markets and how they work
7. Become more critical readers of stories and news in the media
8. Become better decision makers in your financial lives
Who am I?
I wear many hats, literally and figuratively. I am a Professor of Economics in the Economics Department, and Senior Associate Dean in the College of Arts and Sciences. I also have a consulting business, doing mainly expert witness work. (This is called forensic economics.) You may see me around campus, wearing a hat. Say hello if you want.
I was born and raised in Perth, Western Australia, hence my outrageous accent. (Sorry, that’s a weird reference to the taunting of King Arthur and his k-nigits by the French in Monty Python’s Holy Grail.)
I have researched some diverse topics over my academic career:
Why students choose private or public colleges
The patterns of persistence at college
Why and how parents invest in their children through education
The contingent valuation method for valuing environmental services
The value of information
The costs of teenage pregnancy and parenthood
The price of water rights
Mitigating the losses from natural disasters
Responses to low probability, high loss events
Researching the social impacts of extreme weather events
Designing insurance policies for natural disasters
Hedonic damage testimony by forensic economists
I have taught many courses at the graduate and undergraduate level, including:
Benefit-Cost Analysis and Welfare Economics
Personal Finance and Investing
The Economics of Higher Education
Why teach Personal Investing, and why on-line?
I started teaching this course about 20 years ago because of my interest in risk management and insurance. Investing is about the future, and the future, by definition, is uncertain–and risky. Ec212 has always been taught by the Economics Department, even before there was a Business School at UNM. So it is an economics course, not a business school course. There are no pre-requisites, although many students have taken at least introductory economics. I believe an understanding of some fundamental economic concepts can both simplify and clarify how financial markets operate. This might help people make better decisions, and possibly become wise investors.
I decided to take the course online after thinking that my “chalk and talk” style pedagogy was not effective. The last time I taught face-to-face I included more online and technology based elements with some success. The next step was to try out an online class. I have taught this class online for over four years.
Stock Market Game (Virtual Stock Exchange, VSE)
All class members should enroll in an on-line real-time stock market simulation game hosted on the Wall Street Journal’s Marketwatch website.
You must register on the Marketwatch website to access the game, (click here for more information) but in the many years I have used this website and game for Econ 212, I have never seen any spam, or other “problems” associated with registering. You do not need to provide a credit card or other payment type, so if you are asked for anything like this, there’s something wrong.
The game is private, so you will need to use the game password. The main game is called UNMEcon212F17 and the password is Econ212F17. There’s also an additional, practice game called UNMEcon212F17A with the password (Econ212F17A). The practice game, which starts in August at the beginning of class and runs the whole semester, lets you establish your portfolio and get used to buying and selling shares. You can continue with the practice game for the whole semester, or you can start the main game which starts in October and runs for two months, or you can play both. The best plan is to play both games, so you can try out different strategies in each. I will score your best performance in either game for the two scoring months if you choose to continue with both. Your performance will be judged against the benchmark market index, the S&P500. If the return you earn on your portfolio matches that of the index, you will get 180/200. Outperform the index and you can earn a higher score to a maximum of 240/200.
Once registered with Marketwatch, you should search for the class games once they are active by date by typing in “UNMEcon212…” into the Game Search box. Once you join the game(s) you can buy and sell shares, take long and short positions in stocks, and buy on margin. You have $100,000 plus margin account. You cannot buy penny stocks. In the past the majority of students have managed to do at least as well as the reference Index.
General Layout of Course Topics
Each Topic contains the following material and tasks.
Content – the equivalent of lecture notes, which could also include a video (probably me talking over slides, or hand-written notes or a diagram.)
Digressions – these are asides. Related material that is tangential, or less important.
Resources/Readings – PDFs or links to material on the internet to support lectures, asides, or homework. Includes YouTube videos.
Quizzes – short tests to be done after reading the lecture material.
Homework – More substantial individual work to be submitted from a choice of topics.
Discussions – Whole-class discussion topics, often based on a reading. Students must participate in the discussion as it is monitored and scored.
Virtual Stock Exchange – This can, and should, be discussed in the Discussion forums throughout the semester.
Remember, the course content (“lectures”) are on this website, but the quizzes, homework submission and discussion participation are offered only through the Learn course website.