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[quote=Anonymous][quote=Anonymous]You’re teaching them to gamble, essentially. It also might teach them overconfidence in their wins.

I say this as an MBA from a top school.

They should really be taught how to dollar cost average, auto debit to an account and the time value of money. Of course, that’s less sexy. [/quote]

Depends on the age of the kid.  A young kid can learn about companies this way and how to apply math skills to understand them in a way that's motivating.  If they compare it to assorted indices, they will likely find that over time they do better just with that.

Once they are old enough to have their own investment accounts, then you can teach them dca, auto invest and set it and forget it in an index with 90% of their money and pick stocks with their other 10% if they want to.  Kids who do this are much more likely to be interested in businesses in general.

That's what I did with my kids--one just graduated college is not yet 22 and has already amassed more than 20k (90% in total market index, 10% stock picks) in a Roth IRA from HS and college jobs and now also is contributing 15% of income to TSP in addition to the Roth.  He also randomly is interested in companies and reads up on them.  So I think the approach works--and I'm doing it with my daughter now too.  [/quote]

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